Genesis Growth Tech Acquisition Corp (GGAAW) has identified material weaknesses in its internal control over financial reporting as of December 31, 2022. These weaknesses include the lack of segregation of bank accounts, insufficient segregation of duties within accounting processes due to limited personnel, and inadequate written policies and procedures for accounting, IT, and financial reporting. The company is taking steps to remediate these weaknesses and ensure accurate financial statements moving forward.
Genesis Growth Tech Acquisition Corp is a special purpose acquisition company (SPAC) with the goal of identifying suitable business combinations within the technology industry. Its CEO, Eyal Perez, and Co-Executive Chairman, Michael Lahyani, have extensive experience in finance and technology ventures. The company’s executives and board members currently do not receive any cash compensation for their services. However, they are reimbursed for out-of-pocket expenses related to identifying potential target businesses and conducting due diligence.
The material weaknesses identified in the internal control over financial reporting were mainly due to the following reasons:
(a) The company did not segregate bank accounts, causing confusion in the financial statements that required restatement;
(b) Limited personnel led to insufficient segregation of duties within the accounting processes;
(c) There was a lack of written policies and procedures for accounting, IT, and financial reporting, leading to potential errors or inaccuracies in the company’s financial statements.
Genesis Growth Tech is working on remediating these weaknesses and has put new processes and procedures in place to prevent errors or misstatements in the future. This includes executing all financial transactions through accounts in the company’s name, which will help maintain accurate records of financial transactions and assets.
Apart from addressing the material weaknesses in internal controls over financial reporting, Genesis Growth Tech Acquisition Corp also aims to become a leader in sourcing, structuring, fundraising, and investing in technology-focused companies. The company is backed by experienced executives and board members who can provide valuable insights and access to unique investment opportunities.
In conclusion, while the company has faced significant challenges in maintaining effective internal controls over its financial reporting, it is currently taking necessary steps to remedy the weaknesses and ensure accurate financial reporting moving forward. By addressing these issues, Genesis Growth Tech Acquisition Corp can continue to focus on identifying suitable business combinations within the technology industry and striving for long-term success.
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