Company: IXHL
Filing Date: 2025-09-29
Form Type: 10-K
Source: 0001213900-25-092837
Chunk: 751

Company: Incannex Healthcare Inc.
Filing Date: 2025-09-29
Form: 10-K
Item: Item 5
Chunk 751
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 maintaining adequate
internal control over financial reporting. Our internal control over financial reporting is designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of our consolidated financial statements for external reporting purposes in
accordance with US GAAP. Our internal control over financial reporting includes those policies and procedures that:

(1)pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the assets of our company,

(2)provide reasonable assurance that transactions are recorded
as necessary to permit preparation of consolidated financial statements in accordance with US GAAP, and that our receipts and expenditures
are being made only in accordance with authorizations of our management and directors, and

(3)provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial
statements.

92

A control system, no matter
how well designed and operated, can provide only reasonable and not absolute assurance of achieving the desired control objectives. In
reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the benefits of possible
controls and procedures relative to their costs. In addition, the design of any system of controls is based in part upon certain assumptions
about the likelihood of 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, controls may become inadequate because of changes in conditions, or the degree of compliance
with policies or procedures may deteriorate. Because of its inherent limitations, internal control over financial reporting may not prevent
or detect errors or misstatements in our consolidated financial statements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree or compliance
with the policies or procedures may deteriorate. Management, with the participation of our principal executive and principal financial
officers, assessed the effectiveness of our internal control over financial reporting on June 30, 2025. In making these assessments, management
used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control
- Integrated Framework (2013). Based on its assessment, management has concluded that our internal control over financial reporting was
not effective as of June 30, 2025.

A material weakness is defined as a deficiency,
or a combination of deficiencies