Company: CDT
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001641172-25-001246
Chunk: 10

Company: CDT Equity Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1A
Chunk 10
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Any
delay, limitation, or denial in any applicable regulatory approval for any of our clinical assets would delay or adversely impact commercialization
of our clinical assets and would harm our business, financial condition, operating results, and prospects.

35

We
have identified material weaknesses in our internal control over financial reporting. If we fail to remedy these weaknesses or maintain
an effective system of internal controls, then our ability to produce timely and accurate financial statements or comply with applicable
regulations could be adversely affected. We may identify additional material weaknesses in our internal controls over financing reporting
which we may not be able to remedy in a timely manner.

In
connection with the preparation and audit of the financial statements as of and for the fiscal years ended December 31, 2024 and 2023,
material weaknesses were identified in our internal control over financial reporting. A material weakness is a deficiency, or a combination
of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement
of annual or interim financial statements will not be prevented or detected on a timely basis. These material weaknesses primarily relate
to the following matters that are relevant to the preparation of our financial statements:

    ●
    We
    have limited segregation of duties. For the periods under audit, the Company did not have any internal personnel in the financial
    accounting and reporting department, instead relied upon third party consultants to perform these activities.

    ●
    We
    lack a formal process for review and approval of financial statements. For the periods under audit, especially prior to the business
    combination, numerous, recurring errors in account balances and disclosures were detected in the financial statements that resulted
    in a reasonable possibility that a material misstatement would not have been detected on a timely basis.

    ●
    We
    did not design adequate and appropriate internal controls, including monitoring controls, to review and evaluate the accounting implications
    of all material transactions that occurred in the audit period.

If
these material weaknesses are not remediated, it could result in a misstatement of account balances or disclosures that would result
in a material misstatement to the annual or interim financial statements that would not be prevented or detected. We are reviewing measures
designed to improve our internal control over financial reporting to remediate these material weaknesses, although they have not been
fully remediated as of the date of this filing. As a part of these measures, we also expect to engage an external advisor to assist with
evaluating and documenting the