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As a result of the SEC Statement, we reevaluated the accounting treatment of our 6,000,000 Public Warrants and 6,000,000 Private Placement Warrants, and determined that the Warrants should be reclassified as derivative liabilities measured at fair value, with changes in fair value each period reported in earnings.
−Removed: As a result, included on our balance sheet as of June 30, 2021 contained elsewhere in this Form 10-Q are
−Removed: derivative liabilities related to embedded features contained within our Warrants.
−Removed: Accounting Standards Codification 815-40, “Derivatives
−Removed: and Hedging —Contracts on an Entity’s Own Equity”, provides for the remeasurement of the fair value of such derivatives at each balance sheet date, with a resulting non-cash gain
−Removed: or loss related to the change in the fair value being recognized in earnings in the statement of operations.
+Added: As a result, included on our balance sheet as of September 30, 2021 contained elsewhere in this Form 10-Q are derivative
+Added: liabilities related to embedded features contained within our Warrants.
+Added: Accounting Standards Codification 815-40, “Derivatives and
+Added: Hedging —Contracts on an Entity’s Own Equity”, provides for the remeasurement of the fair value of such derivatives at each balance sheet date, with a resulting non-cash gain or
+Added: loss related to the change in the fair value being recognized in earnings in the statement of operations.
As a result of the recurring fair value measurement, our financial statements and results of operations may fluctuate quarterly, based on factors, which are outside of our control.
−Removed: Due to the recurring fair value measurement, we expect that we will recognize non-cash gains
−Removed: or losses on our Warrants each reporting period and that the amount of such gains or losses could be material.
+Added: Due to the recurring fair value measurement, we expect that we will recognize non-cash gains or
+Added: losses on our Warrants each reporting period and that the amount of such gains or losses could be material.
We have identified a material weakness in our internal control over financial reporting.
If we are unable to develop and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results.
−Removed: Following issuance of the SEC Staff Statement on April 12, 2021, and after consultation with our independent registered public accounting firm, our management and our audit committee concluded that, in light of the SEC Statement, it was appropriate to restate our previously issued audited balance sheet as of March 18, 2021 to account for the warrants as liabilities measured at fair value, rather than equity securities (the “Restatement”).
+Added: Following issuance of the SEC Staff Statement on April 12, 2021, and after consultation with our independent registered public accounting firm, our management and our audit committee concluded that, in light of the SEC Statement, it was appropriate to restate our previously issued audited balance sheet as of March 18, 2021, which we filed with the SEC on Form 8-K on March 24, 2021, to account for the warrants as liabilities measured at fair value, rather than equity securities (the “Restatement”).
See “—Our warrants are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results.” As a result of these events, which led to the Restatement, we have identified a material weakness in our internal control over financial reporting.
+Added: Additionally, our management re-evaluated our application of ASC 480-10-S99-3A to our accounting classification of public shares.
+Added: After consultation with our independent registered public accounting firm, our management and our audit committee concluded that it was appropriate to restate our previously issued Restated Balance Sheet and unaudited interim financial statements included in our current report on Form 8-K filed with the SEC on March 24, 2021 and our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2021 and June 30, 2021, filed with the SEC on May 28, 2021 and August 16, 2021, respectively.
+Added: As part of such process, we identified an additional material weakness in our internal control over financial reporting.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented, or detected and corrected on a timely basis.
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We cannot assure you that the measures we have taken to date, or any measures we may take in the future, will be sufficient to avoid potential future material weaknesses.
+Added: Unregistered Sales of Equity Securities and Use of Proceeds from Registered Securities
+Added: Defaults Upon Senior Securities
+Added: Mine Safety Disclosures
+Added: Not applicable.
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.