Company: OCC
Filing Date: 2025-03-10
Form Type: 10-Q
Source: 0001437749-25-006792
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Company: OPTICAL CABLE CORP
Filing Date: 2025-03-10
Form: 10-Q
Item: Item 4
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The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to be effective in providing reasonable assurance that information required to be disclosed in reports under the Exchange Act are recorded, processed and summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “SEC”), and that such information is accumulated and communicated to management to allow for timely decisions regarding required disclosure.

In connection with the restatement described in Note 20 – Restatement of Previously Issued Financial Statements to the financial statements included in the Annual Report filed on Form 10-K for the year ended October 31, 2024, management identified a material weakness in internal control over financial reporting related to the classification of an asset or a liability as either long-term or current. This material weakness resulted in a misclassification of the Company’s Revolver balance as a noncurrent liability instead of a current liability as of October 31, 2023 and for the following interim periods within fiscal year 2024 and 2023: January 31, 2024 and 2023, April 30, 2024 and 2023, and July 31, 2024 and 2023.

To respond to this material weakness, we have devoted significant effort and resources to the remediation and improvement of internal control over financial reporting as it relates to the classification of assets and liabilities as either long-term or current. While the Company has processes to identify and appropriately apply applicable accounting requirements, we have improved these processes with respect to balance sheet classification issues. We have developed a checklist to document our review of asset and liability classification as either long-term or current as of the end of each reporting period, with additional focus on the review and interpretation of relevant literature for any significant new agreements or transactions that may impact such classifications during a reporting period, and documenting the performance of both internal and external consultations, if any, related to such matters. The elements of the remediation plan can only be accomplished over time, and there is no assurance that these initiatives will ultimately have the intended effects.

Our management evaluated, with the participation of our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer), the effectiveness of the Company’s disclosure controls and procedures as of January 31, 2025. Based on this evaluation process, the Chief Executive Officer and Chief