Item 4.02 Non-reliance on Previously Published Financial Statements or a Related Audit
Interim report or review completed.
Due to changing industry practices and the new consensus in the accounting profession, the management of Acquisition company of Climate Real Impact Solutions II (the âCompanyâ) reassessed the Company’s application of ASC 480-10-S99-3A to its accounting classification of redeemable shares of Class A common stock, par value $ 0.0001 per share (the âPublic Sharesâ), issued as part of the units sold under the Company’s initial public offering (the âIPOâ) on
January 29, 2021. Historically, part of public shares was classified as permanent equity in order to maintain equity greater than $ 5 million on the basis that the Company will not repurchase its public shares in an amount which would result in its net tangible assets being less than $ 5,000,001, as described in the Company’s Amended and Restated Certificate of Incorporation (the âCharterâ). As a result of such a reassessment, the management of the Company has determined that Public Shares include certain provisions which require the classification of Public Shares as temporary equity regardless of the minimum limit for the repurchase of net tangible assets contained in the Charter. .
Therefore, on December 8, 2021, the management of the Company and the audit committee of the board of directors of the Company (the âaudit committeeâ) concluded that its previously published balance sheet (i) audited as of January 29, 2021, as filed as Exhibit 99.1 of the company’s current report on Form 8-K with the United States Securities Commission (the “SEC”) on January 29, 2021 (the ârelevant initial balance sheetâ); (ii) unaudited interim financial statements as at and for the quarterly period ended March 31, 2021 included in the company’s quarterly report on Form 10-Q for the completed quarterly period March 31, 2021, deposited with the SECOND to May 24, 2021; (iii) unaudited interim financial statements as at and for the three and six months ended June 30, 2021 included in the company’s quarterly report on Form 10-Q for the completed quarterly period
June 30, 2021, deposited with the SECOND to August 12, 2021; and (iv) the unaudited interim financial statements for and for the three and nine months ended September 30, 2021 included in the company’s quarterly report on Form 10-Q for the completed quarterly period September 30, 2021, deposited with the SECOND to November 15, 2021 (items (ii), (iii) and (iv) collectively, the âAffected Quarterly Periodsâ and, with the affected initial balance sheet, the âAffected Periodsâ) must be restated to report all public shares as temporary equity and should no longer be invoked.
As such, the Company will restate its financial statements for (i) the affected quarterly periods in an amended quarterly report on Form 10-Q / A for the completed quarterly period. September 30, 2021 (the âForm Q3 10-Q / Aâ) and (ii) the initial balance sheet concerned in a current report amended on Form 8-K / A.
As part of the restatement, as is customary in industry accounting and corporate governance practices when an issuer concludes that its financial statements need to be restated, management reassessed the effectiveness of the controls and procedures. communication of the Company’s information and internal control with regard to financial information as of the September 30, 2021. The management of the Company has concluded that, solely as a result of the restatements 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 at September 30, 2021, for the periods covered by the Affected Periods. The Company’s remediation plan for such a material weakness will be further described in Form Q3 10-Q / A.
The Company does not expect that any of the above changes will have an impact on the Company’s cash position and cash held in the trust account established in connection with the IPO (the âTrust accountâ).
Management of the Company and the Audit Committee have discussed the matters disclosed in this current report on Form 8-K in accordance with Section 4.02 (a) with
AvecumSmith + Brown, PC, the Company’s registered independent public accounting firm.
This current report on Form 8-K includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. . Some of these forward-looking statements may be identified by the use of words such as “believes”, “expects”, “intention”, “plans”, “estimates”, “,,,”,, ,,, “”, “, Will”, “seek” or other similar expressions. These statements may include, without limitation, statements regarding the impact of the Company’s restatement of certain historical financial statements, the Company’s cash position and cash held in the trust account, and any proposed corrective action. regarding the significant weaknesses identified. These statements are based on current expectations as of the date of this current report on Form 8-K. BeforeForward-looking statements are subject to a number of risks and uncertainties that can cause actual results to differ materially, many of which are beyond the control of the Company. These risks include, but are not limited to, those set out in the Risk Factors section of the Company’s final prospectus filed in connection with the IPO with the SECOND to January 27, 2021, as may be amended, supplemented or replaced from time to time by other reports that the Company files with the SECOND, including its quarterly reports on Form 10-Q. Except as required by law, the Company assumes no obligation to update or revise these forward-looking statements, whether as a result of new developments or otherwise. Readers are cautioned not to place undue reliance on forward-looking statements.
Â© Edgar online, source Previews