TSS, Inc.

We maintain disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed or submitted under the Exchange Act of 1934, as amended (“the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures.

Due to its inherent limitations, any system of internal control over financial reporting, no matter how well defined, may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, conducted an evaluation, as of the end of the period covered by this report, of the effectiveness of our disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a-15(e). Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, as of September 30, 2025, our disclosure controls and procedures, as defined in Rule 13a-15(e), were ineffective at the reasonable assurance level as we have not yet fully remediated and validated the effective remediation of a material weakness in internal control over financial reporting first identified in the Annual Report on Form 10-K for the year ended December 31, 2024 as described below.

Material Weakness

In the Annual Report on Form 10-K for the year ended December 31, 2024, we identified a material weakness in our internal control over financial reporting relating to the ineffective design of certain management review controls across a portion of the Company’s financial statements, leading to adjustments that were and could have been material to our 2024 consolidated financial statements. Due to the fact that our internal controls over financial reporting during that period did not identify, prevent or detect these risks of material misstatements, we determined the existence of a material weakness in our internal control over financial reporting. We believe the root causes of the control deficiencies were primarily several manual processes in our closing process, combined with challenges in properly segregating duties due to the relatively small size of our accounting department and additional controls needed.

To formally remediate controls, companies must not only update or put into place controls such that they are designed and operate effectively, but such effective operation must be evaluated and verified over a period of time before we determine the control deficiencies that led to the material weakness have formally been remediated. In order to remediate the control deficiencies leading to the material weakness, we have made certain improvements to our internal controls in the first nine months of 2025, plan to make further enhancements, have enhanced management review of certain areas, and have engaged external experts to assist us in more formally designing, documenting and testing our controls. We have also committed to more fully documenting the performance of the controls themselves so that they not only operate effectively but so that there is also sufficient audit evidence that may be reviewed, so that others may verify the effective operation of the controls.

We are committed to maintaining a strong internal control environment and implementing measures designed to help ensure that control deficiencies contributing to the material weaknesses are remediated as soon as possible.

Notwithstanding the material weakness described above, management has concluded that the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for the three-month and nine-month periods ended September 30, 2025 present fairly, in all material respects, our financial position, results of operations and cash flows in conformity with GAAP.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the quarter ended September 30, 2025, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting except as described above. As described above, we have made certain improvements and plan further improvements to our internal controls over financial reporting in periods after the period covered by this quarterly report on Form 10-Q, but those controls have not yet been fully evaluated to determine that they have effectively remediated the material weakness identified above.