Company: ALCE
Filing Date: 2025-06-06
Form Type: 10-K
Source: 0001213900-25-052242
Chunk: 350

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-06-06
Form: 10-K
Item: Item 1A
Chunk 350
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 future events, and there can be no assurance
that any design will succeed in achieving its stated goals under all potential future conditions. Over time, a control may become inadequate
because of changes in conditions or the degree of compliance with policies or procedures may deteriorate. Because of inherent limitations
in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected.

We identified material weaknesses in our internal
control over financial reporting that existed as of December 31, 2024 due to (i) lack of an effective control environment commensurate
with its financial reporting requirements; (ii) lack of design and maintenance of effective controls for communicating and sharing information
within the Company; (iii) lack of design and maintenance of effective controls for transactions between related parties and affiliates
recorded between itself, the parent company and its subsidiaries; (iv) lack of effective controls to address the identification of and
accounting for certain non-routine, unusual or complex transactions and (v) lack of design and maintenance of formal accounting policies,
procedures and controls to achieve complete, accurate and timely financial accounting, reporting and disclosures. Management has taken
initial steps to remedy these weaknesses by increasing the capacity of our qualified financial personnel; implementing a monthly review
with the appropriate responsible parties to review and confirm that the accounting department has received the proper documentation for
various transactions; starting the process of formalizing documentation related to intercompany due to/from within the new organization
structure; having third party experts review non routine, unusual and complex transactions; and working with an external consultant to
review and assess the Company’s current internal control structure.

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While we believe these efforts will improve our
internal controls and address the underlying causes of the material weaknesses, such material weaknesses will not be remediated until
our remediation plan has been fully implemented and we have concluded that our controls are operating effectively for a sufficient period
of time. We cannot be certain that the steps we are taking will be sufficient to remediate the control deficiencies that led to our material
weaknesses in our internal control over financial reporting or prevent future material weaknesses or control deficiencies from occurring. While
we are working to remediate the material weaknesses as timely and efficiently as possible, at this time we cannot provide an estimate
of costs expected to be incurred in connection with the implementation of this remediation plan, nor can we provide an estimate of the
time it will take to complete this remediation plan. Even if management does establish effective