Company: EVLVW
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001628280-25-026845
Chunk: 178

Company: Evolv Technologies Holdings, Inc.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 1
Chunk 178
---
 channel partners, were subject to extra-contractual terms and conditions, some of which were not shared with the Company’s accounting personnel, and that certain Company personnel engaged in misconduct in connection with those transactions. Furthermore, these extra-contractual terms and conditions were withheld from the Company’s Audit Committee of the Board (the “Audit Committee”) and the Company’s independent registered public accounting firm, 

F-6

Table of ContentsEVOLV TECHNOLOGIES HOLDINGS, INC.NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

PricewaterhouseCoopers LLP (“PwC”). The Committee also determined that certain accounting personnel were aware of indications of these extra-contractual terms and conditions during affected periods, and that related allegations were raised internally in July 2024 and known to senior finance and accounting personnel, but that those allegations were not escalated to the Audit Committee or communicated to PwC prior to the filing of the Company’s second quarter 2024 financial statements. As a result of the Investigation, the Board determined that new leadership was critical to moving the Company forward. In November 2024, the Company’s Chief Financial Officer resigned. Additionally, four other employees, including personnel from its sales, finance and accounting departments were terminated or resigned as a result of the Investigation.In connection with the Investigation, the Committee determined that the accounting for certain sales transactions was materially inaccurate and that, among other things, revenue was prematurely or incorrectly recognized (the “Impacted Transactions”) in connection with financial statements prepared for the fiscal years ended December 31, 2022 and December 31, 2023 contained in its Annual Report on Form 10-K for the year-ended December 31, 2023, and its condensed consolidated financial statements for the quarters and year-to-date periods ended June 30, 2022, September 30, 2022, March 31, 2023, June 30, 2023, September 30, 2023, March 31, 2024 and June 30, 2024 contained in its Quarterly Reports on Form 10-Q.A review of the transactions identified in the Investigation determined that restatement changes were necessary due to:•an overstatement or understatement of revenue and cost of revenue depending on the changes to revenue recognition start dates in each period of the consolidated statement of operations; and•an overstatement or understatement of other accounts affected by changes to revenue recognition start dates, including accounts receivable, inventory