Company: LRHC
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112656
Chunk: 235

Company: La Rosa Holdings Corp.
Filing Date: 2025-11-19
Form: 10-Q
Item: Item 8
Chunk 235
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 Report on Form 10-K for 2024 fiscal year, material weaknesses were identified due to lack of segregation of duties,
control environment and size and nature of cybersecurity staffing. We have therefore concluded that our internal controls over financial
reporting are not effective at the reasonable assurance level. A material weakness is a deficiency, or combination of deficiencies, in
our internal controls over financial reporting such that there is a reasonable possibility that a material misstatement of our consolidated
financial statements would not be prevented or detected on a timely basis.

Our
size has prevented us from being able to employ sufficient resources to enable us to have an adequate level of supervision and segregation
of duties. Therefore, it is difficult to effectively segregate accounting duties which comprises a material weakness in internal controls.
To the extent reasonably possible given our limited resources, we intend to take measures to cure the weaknesses, including, but not
limited to, increasing the capacity of our qualified financial personnel to ensure that accounting policies and procedures are consistent
across the organization and that we have adequate controls over our Exchange Act reporting disclosures. As such, we consider these material
weaknesses to not be remediated as of September 30, 2025.

There
were no changes in our internal control over financial reporting, as defined in Rules 13a-15(t) and 15d-15(f) under the Exchange
Act, during the fiscal quarter ended September 30, 2025, that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.

58

PART
II. OTHER INFORMATION

ITEM
1. LEGAL PROCEEDINGS

From
time to time the Company is involved in litigation, claims, and other proceedings arising in the ordinary course of business. Such litigation
and other proceedings may include, but are not limited to, actions relating to employment law and misclassification, intellectual property,
commercial or contractual claims, brokerage or real estate disputes, or other consumer protection statutes, ordinary-course brokerage
disputes like the failure to disclose property defects, commission disputes, and vicarious liability based upon conduct of individuals
or entities outside of the Company’s control, including agents and third-party contractor agents. Litigation and other disputes
are inherently unpredictable and subject to substantial uncertainties and unfavorable resolutions could occur.

As previously disclosed, on February 13,
2023, Mr. Mark Gracy, who served as our Chief Operating Officer from November 18, 2021 to November 15, 2022, filed a