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Evaluation of Disclosure Controls and Procedures
−Removed: In connection with the preparation of this Form 10-Q, pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company carried out an evaluation with the participation of its management, including its Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer), of the effectiveness of the design and operation of our disclosure controls and procedures (as defined under Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of March 31, 2022.
−Removed: Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that, because of the material weaknesses in internal control over financial reporting discussed below, the Company’s disclosure controls and procedures were not effective as of March 31, 2022, to ensure:
+Added: In connection with the preparation of this Form 10-Q, pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company carried out an evaluation with the participation of its management, including its Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer), of the effectiveness of the design and operation of our disclosure controls and procedures (as defined under Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of June 30, 2022.
+Added: Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that, because of the material weaknesses in internal control over financial reporting discussed below, the Company’s disclosure controls and procedures were not effective as of June 30, 2022, to ensure:
(i) that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and (ii) that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.
−Removed: The Company’s internal control over financial reporting is a process designed by or under the supervision of the Company’s Chief Executive Officer and Chief Financial Officer, and overseen by the Board of Directors, to provide reasonable assurance regarding the reliability of financial
−Removed: reporting and the preparation of financial statements for external purposes in accordance with GAAP and includes policies and procedures that:
+Added: The Company’s internal control over financial reporting is a process designed by or under the supervision of the Company’s Chief Executive Officer and Chief
+Added: Financial Officer, and overseen by the Board of Directors, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP and includes policies and procedures that:
• Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets;
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The Company’s remediation plan was designed with the assistance of management’s outside consultant, an internationally recognized accounting firm.
−Removed: In the first quarter of 2022, the Company began to implement new and revised internal controls over financial reporting designed as part of management’s remediation plan across the organization.
−Removed: The Company continues to work with its outside consultant to assist
−Removed: in completing the remaining steps in the remediation plan and believes that its remediation plan will be sufficient to remediate the identified material weaknesses and strengthen its internal control over financial reporting.
−Removed: As the Company continues to evaluate, implement and works to improve, its internal control over financial reporting, management may determine that additional measures to address control deficiencies or modifications to the remediation plan are necessary.
−Removed: Through the first quarter of 2022, the Company has completed certain steps in its remediation plan, including:
+Added: second quarter of 2022, the Company continued to implement new and revised internal controls over financial reporting designed as part of management’s remediation plan across the organization.
+Added: The Company previously expected the implementation of the Company’s new and revised controls to have been completed in the first half of 2022;
+Added: however, during the second quarter, the remediation of controls in certain processes has been delayed due to factors, including resource constraints as a result of labor shortages and the need for additional training in positions relevant to internal controls that had previously experienced turnover.
+Added: In the processes where the Company has designed and implemented new and revised controls, management has commenced testing over the operating effectiveness of such controls.
+Added: The Company is committed to the improvement of its internal control over financial reporting and management continues to work with its outside consultant to assist in completing the remaining steps in the remediation plan, which it believes will be sufficient to remediate the identified material weaknesses and strengthen its internal control over financial reporting.
+Added: As the Company continues to evaluate, implement and work to improve its internal control over financial reporting, management may determine that additional measures to address control deficiencies or modifications to the remediation plan are necessary.
+Added: Through the second quarter of 2022, the Company has completed certain steps in its remediation plan, including:
• for certain processes, developed new and revised existing process narratives and identified risks of material misstatement inherent to those processes;
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• implemented new and revised internal controls over financial reporting for certain processes and information technology environments.
−Removed: The following remaining activities are scheduled for completion in the first half of 2022 in anticipation of conducting management’s testing that will begin in the first half of 2022 in support of issuing management’s assessment of internal control over financial reporting as of December 31, 2022:
+Added: The following remaining activities are scheduled for completion in the third quarter of 2022 to allow for testing of the operating effectiveness of these controls as part of management’s assessment of internal control over financial reporting as of December 31, 2022:
• completion of the identification of risks arising from inappropriate segregation of duties and fraud risks;
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• implementation of controls across the remaining processes and information technology environments;
+Added: • adding accounting personnel and segregating duties amongst accounting personnel;
• ongoing training with control owners, as necessary.
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The execution of the material aspects of this remediation plan began in the second quarter of 2019.
−Removed: Except as noted above with respect to the completion of certain steps in the remediation plan and implementation of certain new and revised internal controls over financial reporting, there has been no change in the Company’s internal control over financial reporting during the quarter ended March 31, 2022, that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act).
+Added: Except as noted above with respect to the completion of certain steps in the remediation plan and implementation of certain new and revised internal controls over financial reporting, there has been no change in the Company’s internal control over financial reporting during the quarter ended June 30, 2022, that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act).
PART II - OTHER INFORMATION
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.