Company: CRWS
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001437749-25-026346
Chunk: 16

Company: CROWN CRAFTS INC
Filing Date: 2025-08-13
Form: 10-Q
Item: Item 4
Chunk 16
---
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
 
Management, with the participation of the Company’s principal executive officer and principal financial officer, evaluated, as of the end of the period covered by this Quarterly Report on Form 10-Q, the effectiveness of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on the evaluation, the Company’s principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures (as such term is defined in Rule(s) 13a-15(e) and 15d-15(e) under the Exchange Act) were not effective as of June 29, 2025 because of the material weaknesses in our internal control over financial reporting described below.
 
As previously reported in the Annual Report on Form 10-K for the year ended March 30, 2025, the Company’s management including the principal executive officer and principal financial officer, concluded that disclosure controls and procedures were not effective as of March 30, 2025 because a material weakness in the internal control over financial reporting existed related to the Company’s failure to effectively design and maintain controls related to the review and approval of all manual journal entries.
 
    14 

  

Notwithstanding these material weaknesses, management believes and has concluded that the condensed consolidated financial statements as included in this Quarterly Report on Form 10-Q present fairly, in all material respects, the Company's financial condition, results of operations and cash flows as of and for the periods presented in accordance with GAAP.         
 

Remediation Efforts to Address Material Weaknesses
 
Management, with oversight from the Audit Committee of the Company’s Board of Directors, is committed to the remediation of the material weakness described above. The Company has continued to implement measures to improve the internal control structure. Specifically, the Company is:

●   Improving the Company’s internal control policies and procedures to ensure that there is appropriate segregation of duties regarding the recording and approval of manual journal entries; and
--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

●   Enhancing the review of manual journal entries, including outlining policies and procedures to strengthen retention of contemporaneous documentation and ensure timely supervisory reviews by management.
-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
 
Management is committed to a strong internal control environment and to remediating these material weaknesses as soon as possible. Management will determine that the material weaknesses have been fully remediated only after the Company has (i) implemented and tested necessary