Correction of Immaterial Errors

9 Months Ended

Sep. 30, 2022

Correction Of Immaterial Errors

Correction of Immaterial Errors

13. Correction of Immaterial Errors

During the third quarter ending September 30, 2022, management identified and corrected certain immaterial errors in the Company’s historical financial statements associated with the cost of revenues provided by a subcontractor. The errors understated the cost of revenue and overstated the sales and marketing operating expenses by equal amounts in the Condensed Consolidated Statement of Operations. The error had no impact on operating losses, net losses and net loss per share nor any other financial statement amount. Further these errors had no impact on the balance sheets, statements of changes in stockholders’ equity, other comprehensive loss or cash flows. These corrections do not affect any of the metrics used to calculate and evaluate management’s compensation and had no impact on bonuses, commissions, stock-based compensation, or any other employee renumeration. Historical amounts have been corrected and are presented on a comparable basis.

The below table presents the effect of the correction for the following periods: 

	Six Months Ended June 30, 2022
	As Reported			Adjustments			As Corrected
Revenue	$	3,893		$	–		$	3,893
Cost of Revenue		1,321			498			1,819
Gross Profit		2,572			(498	)		2,074
Operating Expenses
Sales and marketing		3,272			(498	)		2,774
Research and development		3,136			–			3,136
General and administrative		4,109			–			4,109
Operating Loss		(7,945	)		–			(7,945	)

	Three Months Ended September 30, 2021
	As Reported			Adjustments			As Corrected
Revenue	$	1,819		$	–		$	1,819
Cost of Revenue		690			249			939
Gross Profit		1,129			(249	)		880
Operating Expenses
Sales and marketing		3,782			(249	)		3,533
Research and development		1,863			–			1,863
General and administrative		1,592			–			1,592
Operating Loss		(6,108	)		–			(6,108	)

	Nine Months Ended September 30, 2021
	As Reported			Adjustments			As Corrected
Revenue	$	5,632		$	–		$	5,632
Cost of Revenue		2,048			747			2,795
Gross Profit		3,584			(747	)		2,837
Operating Expenses
Sales and marketing		10,132			(747	)		9,376
Research and development		4,862			–			4,862
General and administrative		4,261			–			4,261
Operating Loss		(15,662	)		–			(15,662	)