Company: PLSAY
Filing Date: 2025-05-09
Form Type: 20-F
Source: 0001884082-25-000012
Chunk: 292

Company: Polestar Automotive Holding UK PLC
Filing Date: 2025-05-09
Form: 20-F
Item: Item 15
Chunk 292
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 may not be prevented or detected.

Remediation Status & Plans

Management performed the following remediation efforts during 2024 as it relates to aspects of the previously identified material weaknesses:

• appointed a new Chief Executive Officer and Chief Financial Officer in October 2024, to improve our accounting and SEC regulatory reporting expertise;

• designed and implemented internal controls to address the scoping, execution and reconciliation of physical inventory counts;

• IT general controls were deemed effective in the SOC 1 report obtained from an external service organization related to the systems used in (i) revenue streams dealers’ and importers’ sales of vehicles, and (ii) inventory.

Management is also undertaking ongoing remediation efforts related to the above identified material weaknesses including, (but not limited to):

• continuing to design, implement, document and test internal controls over financial reporting, to operate at a sufficient level of precision and frequency, evidencing the performance of the control;

• continuing to hire additional accounting and finance resources with appropriate technical accounting and reporting experience to execute timely key controls related to various financial reporting processes and allow proper segregation of duties;

• continuing to enhance existing policies and procedures and developing new policies and procedures to assist the finance organization in recording transactions appropriately;

Ta b le of Conte n t s

• continuing to train accounting and finance resources on the requirements of the precision of the review and documentation of completeness and accuracy of the data used in the control with a focus on repurchase liability, accrued expenses, accounts payable, intangible assets, inventories, sales of vehicles, deferred revenue, journal entries, payroll, debt, internally developed intangible assets and related party transactions;

• developing existing systems, designing new controls and training control performers to address control deficiencies related to primarily sales of vehicles and inventories to address the completeness and accuracy of information used in downstream controls;

• strengthening the process to identify related parties to ensure complete and accurate disclosures; and collaborating with the external service provider organization to address IT general control deficiencies related to warranty provision in order to ensure the completeness and accuracy of information used in downstream warranty provision.

The Company is continuously and actively engaging in efforts towards remediating its existing material weaknesses. While we believe that these efforts will improve our internal control over financial reporting, the implementation of these measures is ongoing and will require validation and testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles. Due to this ongoing testing, we cannot provide assurance that the measures we have taken to date, and are continuing to implement, will be sufficient to remediate