Business Context and Reporting Period
This Form 6-K filing by Cenntro Electric Group Limited (formerly Naked Brand Group Limited) covers the month of April 2022. The Company completed a reverse recapitalization in December 2021, acquiring Cenntro Automotive Group, which resulted in Cenntro's financial statements becoming the Company's historical records. Consequently, the Company changed its fiscal year-end from January 31 to December 31.
Financial Metrics
The filing text does not provide specific values for revenue, profit, cash flow, margins, debt, or liquidity. This report focuses exclusively on corporate governance and auditor changes rather than financial performance data.
Material Changes
- Accountant Resignation: BDO Audit Pty Ltd resigned as the independent registered public accounting firm effective April 4, 2022, following consent from the Australian Securities and Investments Commission (ASIC).
- New Auditor Engagement: Marcum Bernstein & Pinchuk LLP (MBP) was engaged as the independent registered public accounting firm to audit financial statements for the year ended December 31, 2021, in accordance with U.S. GAAP.
- ASIC Compliance Auditor: Wis Audit Pty Ltd was appointed as the ASIC-registered independent auditor for statutory compliance with the Australian Corporations Act.
Outlook, Risks, and Contingencies
The filing discloses previously identified material weaknesses in internal controls over financial reporting for the periods ended January 31, 2021, and 2020. These weaknesses included:
- Lack of appropriate staffing with technical expertise in the accounting department.
- Absence of a formally implemented system of internal control and associated documentation.
- Insufficient oversight by the board of directors and audit committee regarding remediation.
- Lack of design controls for evaluating non-routine transactions.
- Lack of regular compensation committee meetings.
There were no disagreements between the Company and BDO regarding accounting principles or audit scope during the relevant periods. The change in auditors was driven by the reverse recapitalization structure of the Combination.
Key Facts for Investor Verification
- Verify the transition of audit responsibilities from BDO to MBP for U.S. GAAP reporting and Wis Audit for Australian statutory compliance.
- Confirm the status of remediation efforts for the disclosed material weaknesses in internal controls.
- Review the Company's upcoming financial reports for the fiscal year ended December 31, 2021, to assess the impact of the reverse recapitalization on financial presentation.
- Note that the filing does not contain current financial performance metrics; investors should refer to the most recent 20-F or 10-K filings for revenue and liquidity data.