Company: ZCARW
Filing Date: 2025-05-12
Form Type: S-1/A
Source: 0001213900-25-041769
Chunk: 73

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-05-12
Form: S-1/A
Chunk 73
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 the us and the market price of our stock. Zoomcar has identified certain material weaknesses in Zoomcar’s internal controls over financial reporting. These material weaknesses primarily relate to the following matters that are relevant to the preparation of our consolidated financial statements: (a) our controls were not adequately designed to properly monitor and document related party transactions, (b) our controls over independent review and documentation of third-party specialists, advisors reports and accounting advisors were not operating effectively, (c) our controls over financial reporting, specifically related to the inadequacy of our financial reporting policies and procedures, controls over financial statement closure process were not operating effectively, (d) our controls were not adequately designed to provide sufficient documentation and review of the operating effectiveness of Information Technology General Controls (‘ITGC’) for information systems that are relevant to the preparation of the Company’s consolidated financials and (e) lack of relevant employees with comprehensive knowledge and understanding of US GAAP requirements. Zoomcar is in the process of implementing plans and procedures in order to remediate these weaknesses, which it expects to continue to develop and refine in the near term. 35 In light of the aforementioned material weaknesses, our management has performed additional analyses, reconciliations, and other post-closing procedures and has concluded that, notwithstanding the material weaknesses in our internal control over financial reporting, the consolidated financial statements included in this registration statement fairly present, in all material respects, our financial position, results of operations and cashflows for the periods presented in conformity with GAAP. These material weakness are being addressed by the Company by taking the following measure listed below:

| (i) | We designed and implemented processes for identification, monitoring and regulatory compliance of transactions involving related parties. Our processes include rolling out related party transaction questionnaires quarterly to the identified related parties. The management intends to continue to take steps and monitor the progress of the internal controls implemented. |

| (ii) | The management actively engages with valuation experts to communicate the underlying assumptions and terms of the financial instruments. The management intends to continue to monitor the progress of the internal controls implemented. |

| (iii) | Developing financial reporting manuals including Standard Operating Procedures for financial statement closure processes to ensure compliance with US GAAP and SEC reporting requirements and monitoring controls over financial statement closure process. |
| (iv)  | Management is working on hiring, training and retention of inhouse resources with requisite US GAAP knowledge. The management has also engaged external accounting professionals and is developing processes for sufficient managements reviews.            |

| (v) | Management is