Company: CLSKW
Filing Date: 2025-02-06
Form Type: 10-Q
Source: 0000950170-25-015470
Chunk: 160

Company: CLEANSPARK, INC.
Filing Date: 2025-02-06
Form: 10-Q
Item: Item 8
Chunk 160
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 user to create users and also perform accounting transactions;

•Implemented quarterly reviews of user access logs by individuals who do not perform accounting transactions in the general ledger;  

•Redesigned and implemented relevant complementary user entity controls identified in third-party service organization system organization and control reports; 

•Expanded the management and governance over IT system controls, including the hiring of a Systems Analyst and an IT Analyst; 

•Redesigned and implemented controls over the completeness and accuracy of information used in the operation of controls, including data used in the preparation of condensed consolidated financial statements; and

•Redesigned and implemented controls over logical access, including user access provisioning, termination, and periodic review for all financial reporting systems.

19

Material weakness design of property plant and equipment and deposits on miners. 

The planned remediation actions include the following:  

•Redesign and implementation of controls related to the counting of received property, plant and equipment;  

•Design and implement controls over the completeness and accuracy of information used in the operation of controls, including data used in the preparation of condensed consolidation financial statements;

•Implement controls related to the miner receiving process to ensure adequate documentation is maintained to support the accounting for miners in transit and period-end balances; and 

•Conduct training related to documentation, policies and procedures for shipping, receiving and counting of property, plant and equipment.

Material weakness in the design of controls related to the Company’s use of its third-party payroll service provider and payroll processing.

The remediation actions include the following:  

•Redesigned and implemented controls to address segregation of duties issues when processing, approving and submitting payroll.

•Implemented controls related to confirmation of payrolls processed are same as those approved.

•Restricted administrator access to individuals who do not have responsibility to process, approve or submit payroll.

Material weakness related to the design of internal controls to safeguard cash assets

The remediation actions include the following:  

•Designed and implemented a control to require two approval signatures for cashier check requests; and

•Enhanced the design of controls related to cash reconciliation procedures verifying cashier checks issued.

While these remedial actions are designed and implemented to correct the material weaknesses, changes to internal controls over financial reporting require operation for a sufficient period of time in order for management to evaluate and test the operating effectiveness. Management will continue to monitor and evaluate the effectiveness of these changes for a sufficient period of time prior to concluding that these controls are designed and operating effectively, and the material weaknesses can be considered remediated.

Changes in Internal Control over Financial Reporting

The Company