AmpliTech Group Inc

For the period ended Mar 31, 2024. Filed May 28, 2024.

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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Mar 31, 2024 · Filed May 28, 2024

AMPG$2.40+4.1%Stored close · as of Nov 9, 2026

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Contents

Item 1A. Risk Factors

We have concluded that there are material weaknesses in our internal control over financial reporting, which, if not remediated, could materially adversely affect our ability to timely and accurately report our results of operations and financial condition. The accuracy of our financial reporting depends on the effectiveness of our internal controls over financial reporting.

Internal controls over financial reporting can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements and may not prevent or detect misstatements. Failure to maintain effective internal controls over financial reporting, or lapses in disclosure controls and procedures, could undermine the ability to provide accurate disclosure (including with respect to financial information) on a timely basis, which could cause investors to lose confidence in the Company’s disclosures (including with respect to financial information), require significant resources to remediate the lapse or deficiency, and expose it to legal or regulatory proceedings.

During its evaluation of the effectiveness of our internal control over financial reporting as of March 31, 2024, our management identified the following material weaknesses:

●	we do not have written documentation of our internal control policies and procedures, including written policies and procedures to ensure the correct application of accounting and financial reporting with respect to the current requirements of GAAP and SEC disclosure requirements;
●	we failed to maintain a sufficient complement of personnel in our accounting and reporting department to ensure adequate segregation of duties such that appropriate review and monitoring of its financial records are executed;
●	we failed to maintain sufficient segregation of duties and approval hierarchy for material transactions and cash disbursements, specifically, there was a lack of segregation of duties involved in the execution and approvals of wire transfers for material investments in digital assets;
●	we did not design and maintain effective internal controls related to our information technology general controls in the areas of user access and program change-management over certain information technology systems that support our financial reporting processes; and
●	we failed to understand and consistently follow proper corporate procedures.

The Company’s remediation efforts are ongoing and the Company is implementing the following remedial procedures:

●	increasing personnel resources and technical accounting expertise within the accounting function;
●	until we have sufficient technical accounting resources, we have engaged external consultants to provide support and to assist us in our evaluation of more complex applications of GAAP;
●	engaging internal control consultants to assist us in performing a financial reporting risk assessment as well as identifying and designing our system of internal controls necessary to mitigate the risks identified;
●	preparation of written documentation of our internal control policies and procedures and accounting processes;
●	requiring an approval hierarchy for all material expenses and transactions, which we implemented in the second quarter of 2024; and
●	commencing in the second quarter of 2024, requiring dual authorization on all ACH payments and bank wires, including an appropriate approval hierarchy, including board approval, on material transactions and agreements or any investment of Company funds.

We will continue to enhance corporate oversight over process-level controls and structures to ensure that there is appropriate assignment of authority, responsibility, and accountability to enable remediation of our material weaknesses. We believe that our remediation plan will be sufficient to remediate the identified material weaknesses and strengthen our internal control over financial reporting. As we continue to evaluate, and work to improve, our internal control over financial reporting, management may determine that additional measures to address control deficiencies or modifications to the remediation plan are necessary.

We cannot guarantee that we will be successful in remediating the material weakness identified or that our internal control over financial reporting, as modified, will enable us to identify or avoid material weaknesses in the future.

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