Item 4. Controls and Procedures
Item
4. Controls and Procedures.
Management’s
Report on Disclosure Controls and Procedures
In
connection with the restatement of the Company’s financial statements included in this Amendment, our Chief Executive Officer and
Chief Financial Officer re-evaluated the effectiveness of the design and operation of our disclosure controls and procedures and internal
control over financial reporting, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the
“ Exchange Act ”), as of September 30, 2023.
To
ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the rules and forms of the SEC, including to ensure that information required
to be disclosed by us in the reports filed or submitted by us under the Exchange Act is accumulated and communicated to our management,
including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
Based
on that re-evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of September 30, 2023, our disclosure
controls and procedures and internal control over financial reporting were not effective, due to material weaknesses in SSi’s internal
control in that:
●
We
failed to design controls and procedures to provide reasonable assurance that U.S. GAAP was being properly applied to the matters
resulting the restatement of our financial statements, including accounting for merger transaction, recognition of revenue in case
of deferred payment sales, recognition of right of use of certain assets and lease liabilities and functional and other classifications,
resulting in the accounting errors described in Note 1. Restatement of Previously Issued Condensed Consolidated Financial
Statements , of this Amendment.
●
We
do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls
over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act. Management evaluated the impact of our failure
to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures
and has concluded that the control deficiency that resulted represented a material weakness.
●
We
do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and
nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent
possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate
individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls
and procedures and procedures and has concluded that the control deficiency that resulted represented a material weakness.
Remediation
Plan
The
Company has been addressing and remediating these material weaknesses with the support and assistance of the accounting and financial
staff employed by our Indian operating subsidiary. We are enhancing the review process for significant transactions to ensure proper
accounting treatment under applicable guidelines and are engaging external experts where necessary to assist in the application of accounting
principles to complex transactions. In addition, we are implementing a new ERP system which is designed to integrate all business functions
within the accounting and financial department to further address the abovementioned weaknesses.
Our
Chief Executive Officer and Chief Financial Officer do not expect that our disclosure controls or internal controls will prevent all
errors and all fraud. Although our disclosure controls and procedures were designed to provide reasonable assurance of achieving their
objectives a control system, no matter how well conceived and operated, can provide only reasonable, not absolute assurance that the
objectives of the system are met. Further, the design of any control system is subject to resource constraints and the benefits of controls
must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent
limitations include the fact that judgments in decision-making can be faulty, and that breakdowns can occur because of simple errors
or mistakes. Additionally, controls can be circumvented if there exists in an individual a desire to do so. There can be no assurance
that any design will succeed in achieving its stated goals under all potential future conditions.
(b)
Changes in Internal Controls Over Financial Reporting
Except
for the remediation efforts described above, there were no changes in our internal controls over financial reporting that occurred during
the last fiscal quarter covered by this report that has materially affected, or is reasonably likely to materially affect, our internal
control over financial reporting.
50
PART
II – OTHER INFORMATION
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.