Company: CODI-PB
Filing Date: 2025-12-08
Form Type: 10-K/A
Source: 0001345126-25-000078
Chunk: 217

Company: Compass Diversified Holdings
Filing Date: 2025-12-08
Form: 10-K/A
Chunk 217
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 steps the Company is taking will remediate the material weaknesses in internal control over financial reporting until a sustained period of time has passed to allow management to test the design and operational effectiveness of the new and enhanced controls. As the Company's management, under the oversight of the Audit Committee, continues to evaluate and improve the Company's internal controls over financial reporting, management may decide to take additional measures to address control deficiencies or determine to modify, or in appropriate circumstances not to complete, certain of the remediation measures identified.

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As of the filing of this Form 10-K/A, the Company has undertaken and is continuing to undertake its remediation efforts to reemphasize its commitment to integrity and ethical values in our control environment, including the following actions:

• At the Company:

◦ Ensuring that individuals responsible for internal controls possess appropriate expertise specific to the industries in which future acquisition targets and current and future operating subsidiaries conduct their business, providing targeted training or engaging qualified specialists as needed to support control implementation and effectiveness;

◦ Conducting a full review of the Company’s compliance and governance policies and procedures in order to assess and recommend potential changes, as appropriate, for the Board’s review and approval. Key initial considerations designed to enhance the Company's compliance program include implementing a dedicated corporate ethics and compliance office with appropriate resources, refreshing compliance policies and procedures, including the code of conduct, and establishing management steering committees tasked with oversight over functions associated with the identified material weaknesses, including compliance, risk assessment, credit, and investment;

◦ Reevaluating investment processes, parameters, risk assessment, and governance requirements in respect of potential acquisitions, providing for increased visibility and oversight of acquired companies, and enhancing post-acquisition onboarding processes including an assessment of the processes and controls of the acquired entity and support for designing new, or redesigning existing, processes and controls for the acquired entity;

◦ As of August 27, 2025, retaining an external expert to lead the Company’s internal audit function;

◦ Evaluating the risk and compliance functions, including enhancing the effectiveness of the implementation and monitoring of risk and controls at the subsidiary level and of the whistleblower program;

◦ Evaluating the internal audit function, including evaluation of its composition and structure, alignment of roles and responsibilities to individuals who possess appropriate skillsets and industry knowledge, including the use of external experts, when necessary; updating the internal audit charter, reporting lines and scope of responsibilities, ongoing and periodic self-assessments, and providing for an external quality assessment