Company: DSWL
Filing Date: 2025-07-29
Form Type: 20-F
Source: 0001174947-25-001096
Chunk: 117

Company: DESWELL INDUSTRIES INC
Filing Date: 2025-07-29
Form: 20-F
Item: Item 15
Chunk 117
---
 financial statements will not be prevented or detected on a timely basis.

We identified a material weakness in internal control related to ineffective information technology general controls (“ ITGCs”) in the area of user restrictions and privileged access, and program change management over a key information technology (“ IT”) system that supports our financial reporting processes. As a result, the related process-levelIT dependent controls and application controls were also ineffective. The IT material weakness did not result in any material misstatements in our financial statements or disclosures.

Table of Contents

We plan to take actions to remediate these material weaknesses, see “ Remediation of the Material Weakness in Internal Control Over Financial Reporting” below under “ - Changes in Internal Control Over Financial Reporting” for further information on the steps we are taking to remediate the material weaknesses. Until the relevant controls have been operating for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively, the material weaknesses described above will continue to exist.

C. Attestation Report of Independent Registered Public Accounting Firm

This annual report on Form 20-Fdoes not include an attestation report of our independent registered public accounting firm on internal control over financial reporting because we qualified as a “non-acceleratedfiler” as of March 31, 2025.

D. Changes in Internal Control Over Financial Reporting

Other than as described below, there were no changes in our internal control over financing reporting (as defined in Rule 13a-15(f) of the Exchange Act) that occurred during the period covered by this Annual Report that has materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Remediation of the Material Weakness in Internal Control Over Financial Reporting

Following the identification of the material weakness described above, and with the oversight of the Audit Committee, we plan to take the following actions:

•Engage a third party to assist in designing and implementing controls related to segregation of duties and information technology general controls.

•Strengthen our IT compliance oversight by adding additional personnel engaged in that function;

•Design and implement controls to formalize roles and review responsibilities in order to formalize and implement controls over segregation of duties.

•Design and implement information technology general controls, including controls over program change management and, the review and update of user access rights and privileges.

We believe the foregoing efforts, when fully implemented and operational, will effectively remediate the material weaknesses described above and strengthen our internal control over financial reporting. As we continue to evaluate and work to improve our