Business Context and Reporting Period
This Form 8-K is filed by Northern Lights Acquisition Corp. (not SHF Holdings, Inc.) on November 15, 2021. The filing addresses a material weakness in internal controls and the subsequent non-reliance on previously issued financial statements.
Key Financial Metrics
The filing does not provide specific revenue, profit, cash flow, or debt figures. Instead, it focuses on a reclassification of Class A common stock as temporary equity. This accounting adjustment necessitated the restatement of:
- The audited balance sheet as of June 28, 2021.
- The unaudited financial statements as of June 30, 2021.
Corrected financial data is reflected in the Company's Form 10-Q for the period ended September 30, 2021, filed concurrently on November 15, 2021.
Material Changes and Restatements
The Audit Committee concluded that prior financial statements should no longer be relied upon due to the error in classifying Class A common stock. Consequently:
- Disclosure Controls: Management determined that disclosure controls and procedures were not effective during the period the error persisted.
- Internal Controls: A material weakness was identified in internal controls over financial reporting, specifically regarding the analysis of complex financial instruments.
- Remediation: Additional analysis was performed to ensure compliance with U.S. GAAP, and restatements were incorporated into the Q3 2021 10-Q.
Outlook, Risks, and Management Commentary
Management and the Audit Committee discussed the matter with the independent registered public accounting firm, Marcum LLP. The filing includes standard forward-looking statements, noting that actual results may differ materially from projections due to risks and uncertainties, including the timing and results of the restatement process.
Investor Verification Checklist
- Verify the corrected balance sheet figures in the Form 10-Q for the period ended September 30, 2021 (filed Nov 15, 2021).
- Review Note 2 of the Q3 2021 financial statements for details on the reclassification of Class A common stock to temporary equity.
- Assess the impact of the material weakness on future financial reporting reliability.
- Confirm the status of the Company's SPAC merger activities, as this filing relates to Northern Lights Acquisition Corp., not SHF Holdings.