Aspira Womens Health Inc
For the period ended Sep 30, 2024. Filed Nov 19, 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.
Sep 30, 2024 · Filed Nov 19, 2024
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Item 4. Controls and Procedures
Evaluation of disclosure controls and procedures
Our senior management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Management, including our Chief Executive Officer and Interim Chief Financial Officer, performed an evaluation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2024. Based on this evaluation, our Chief Executive Officer and Interim Chief Financial Officer have concluded that as of September 30, 2024, our disclosure controls and procedures were not effective. This was due to two material weaknesses in the internal control over financial reporting that were identified as of December 31, 2023, and disclosed in our 2023 Annual Report Form 10-K related to multiple deficiencies and a lack of timely operation of certain internal controls over financial reporting and disclosure that continue to exist as of September 30, 2024.
Material Weaknesses
As previously reported, we identified material weaknesses related to:
| ● | the operation of internal controls related to information technology general controls (“ITGCs”) that are used to process and record certain revenue and expense transactions and support our financial reporting processes. The internal control around ITGCs resulted in the lack of certain internal controls over these IT systems and over data and reports accumulated in such IT systems; and |
| ● | the design and implementation of our control activities over our revenue process. We did not adequately design controls to validate the delivery of the lab results to ordering physicians to ensure that revenue is being appropriately recognized. |
Remediation Activities
In order to address the material weaknesses in internal control over financial reporting described above, management is performing, with direction from the audit committee, the following remediation activities:
| ● | Retained an internal controls specialist to complement the skills of the existing accounting and financial reporting staff, as well as implement key controls to improve business processes, including revenue and the IT environment. |
| ● | Completed a preliminary process to identify all information technology applications that support the Company’s financial reporting processes and assess the risk of misstatement associated with each. |
| ● | Completed a comprehensive review of the design and performance of internal controls related to information technology applications, including user access and program change controls. |
| ● | Enhanced controls that require the assessment of service organization controls prior to implementation and on an annual basis. |
| ● | Retained additional accounting and financial reporting resources during the year-end close to improve our ability to perform our disclosure controls and procedures on a timely basis, particularly for certain significant, non-routine or complex transactions. |
| ● | Providing additional training and continuing education to accounting staff regarding SEC requirements and required disclosures under GAAP. |
| ● | Enhanced the design of and implementation of controls around the rigor of the review process, and retention of sufficient appropriate evidence over the revenue process. |
Management will continue to review and make necessary changes to the overall design of our internal control environment, as well as policies and procedures to improve the overall effectiveness of internal control over financial reporting. The material weaknesses will not be considered remediated, however, until the applicable controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.
Changes in internal controls over financial reporting
As steps to remediate the material weaknesses discussed above, management has reviewed the design and performance of internal controls related to information technology applications and enhanced the design of and implementation of controls around the rigor of its review and documentation process. Apart from these steps, there was no change in our internal control over financial reporting that occurred during the period ended September 30, 2024, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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