Company: IPHYF
Filing Date: 2025-04-30
Form Type: 20-F
Source: 0001598599-25-000042
Chunk: 47

Company: Innate Pharma SA
Filing Date: 2025-04-30
Form: 20-F
Item: Item 3
Chunk 47
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 penalties are payable by us, in which case, the Company expects that it might contest such assessment.

Contesting such an assessment may be lengthy and costly, and if Innate was unsuccessful in disputing the assessment, the result could increase its anticipated effective tax rate.

In 2022 and 2023, the Company was subject to tax inspections by the French tax authorities, in particular one tax inspection from the French tax authorities relating to fiscal years 2018 to 2021 that resulted in a n adjustment of €1.4 million.

Risks Related to Innate Pharma's Organization and Operations

In the past there have been material weaknesses in the Company's internal control over financial reporting and if Innate Pharma is unable to maintain effective internal controls over financial reporting, the accuracy and timeliness of its financial reporting may be adversely affected, which could hurt its business and/or lessen investor confidence.

The Company must maintain effective internal control processes over financial reporting in order to accurately report its results of operations and financial condition on a timely basis. A company’s internal control over financial reporting is a process designed by, or under the supervision of, a company’s principal executive and principal financial officers, or persons performing similar functions, and effected by a company’s Executive Board, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles.

As a public company listed in the United States, the Sarbanes-Oxley Act requires, among other things, that the Company assess the effectiveness of its internal control over financial reporting as of the end of each fiscal year. As the Company lost its "emerging growth company" (EGC) status as of December 31, 2024, Innate's independent registered public auditor is now required to attest to and report on the effectiveness of its internal controls over financial reporting.

In this context, in order to comply with Section 404(b) of the Sarbanes-Oxley Act within the prescribed timeframe, and over the last five years, the Company has reinforced its internal control processes and has implemented a standard and more robust Information System including an Enterprise Resource Planning (ERP) tool supporting the production and the management of its financial information. Some material weaknesses were identified as of December 31, 2020 and 2022.

Under standards established by the Public Company Accounting Oversight Board, a material weakness is a deficiency or combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement in Inn