Item 4.02 Non-Reliance on Previously Issued Financial Statements or Related
Audit Report or Completed Interim Report.
The management of the Company has re-evaluated the Company's application of ASC
480-10-S99-3A to its accounting classification of the redeemable Class A
ordinary shares, par value $0.0001 per share (the "Public Shares"), issued as
part of the units sold in the Company's initial public offering (the "IPO") on
February 9, 2021. Historically, a portion of the Public Shares were classified
as permanent equity to maintain net tangible assets greater than $5,000,000 on
the basis that the Company will consummate its initial business combination only
if the Company has net tangible assets of at least $5,000,001. Pursuant to such
re-evaluation, the Company's management has determined that the Public Shares
include certain provisions that require classification of the Public Shares as
temporary equity regardless of the minimum net tangible assets required to
complete the Company's initial business combination.
Therefore, on November 11, 2021, the Company's management and the audit
committee of the Company's board of directors (the "Audit Committee"), after
consultation with Marcum LLP ("Marcum"), the Company's independent registered
public accounting firm, concluded that the Company's previously issued
(i) audited balance sheet as of February 9, 2021, as previously restated in the
Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31,
2021, filed with the SEC on June 3, 2021 (the "Q1 Form 10-Q"), (ii) unaudited
interim financial statements included in the Q1 Form 10-Q and (iii) unaudited
interim financial statements included in the Company's Quarterly Report on Form
10-Q for the quarterly period ended June 30, 2021, filed with the SEC on
August 16, 2021 (collectively, the "Affected Periods"), should be restated to
report all Public Shares as temporary equity and should no longer be relied
upon. As such, the Company will restate its financial statements for the
Affected Periods in the Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 2021, (the "Q3 Form 10-Q") that will be
filed with the SEC.
The Company does not expect any of the above changes will have any impact on its
cash position and cash held in the trust account established in connection with
the IPO.
The Company's management has concluded that in light of the classification error
described above, a material weakness exists in the Company's internal control
over financial reporting and that the Company's disclosure controls and
procedures were not effective. The steps the Company has taken to remediate such
material weakness will be described in more detail in the Q3 Form 10-Q.
The Company's management and the Audit Committee have discussed the matters
disclosed in this Current Report on Form 8-K pursuant to this Item 4.02 with
Marcum.
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