Note 2 - Correction of Immaterial Errors

3 Months Ended

Mar. 31, 2023

Notes to Financial Statements

Error Correction [Text Block]

2. Correction of immaterial errors

As reported in our Annual Report as of and for the fiscal year ended December 31, 2022, we determined that an error existed in our previously issued consolidated financial statements. Specifically, we identified we had established nexus in several jurisdictions beginning in the year ended December 31, 2019 in which we were not collecting and remitting sales taxes appropriately. The error was evaluated and recorded as of each period impacted by the error under the SEC guidance on evaluating the materiality of prior period misstatements to the Company’s financial statements. We evaluated the error and concluded that it was not material to any previously issued consolidated financial statements and accompanying Unaudited Condensed Consolidated financial statements. Although the error was not material to any period, we corrected the accompanying historical Unaudited Condensed Consolidated financial statements for each period impacted. The corrections to the quarter ended March 31, 2022 are presented below to reflect the sales tax liability and associated expenses owed within the period for comparative purposes.

The effect of the adjustments to our Unaudited Condensed Consolidated Balance Sheet as of March 31, 2022 was as follows:

	March 31, 2022
(In thousands)	As reported			Adjustment			As corrected
Prepaid expenses and other current assets	$	4,757		$	267		$	5,024
Total current assets		118,701			267			118,968
Total assets		544,012			267			544,279
Accrued expenses and other current liabilities		6,966			(233	)		6,733
Sales taxes payable		-			2,945			2,945
Total current liabilities		35,040			2,712			37,752
Total liabilities		65,492			2,712			68,204
Accumulated deficit		(112,086	)		(2,445	)		(114,531	)
Total shareholders’ equity		478,520			(2,445	)		476,075
Total liabilities and shareholders’ equity		544,012			267			544,279

The effect of the adjustments to our Unaudited Condensed Consolidated Statements of Operations for the quarter ended March 31, 2022 was as follows:

	Three Months Ended March 31, 2022
(In thousands, except per share and share data)	As reported			Adjustment			As corrected
General and administrative	$	11,196		$	334		$	11,530
Total operating expenses		43,853			334			44,187
Operating loss		(7,633	)		(334	)		(7,967	)
Interest expense		(163	)		(21	)		(184	)
Total other expense, net		(32	)		(21	)		(53	)
Loss before income tax benefit		(7,665	)		(355	)		(8,020	)
Net loss		(7,066	)		(355	)		(7,421	)
Net loss per basic and diluted share		(0.17	)		(0.01	)		(0.18	)

The effect of the adjustments to our Unaudited Condensed Consolidated Statements of Cash flows for the quarter ended March 31, 2022 was as follows:

	Three Months Ended March 31, 2022
(In thousands)	As reported			Adjustment			As corrected
Net loss	$	(7,066	)	$	(355	)	$	(7,421	)
Prepaid expenses and other current assets		(25	)		(1,188	)		(1,213	)
Sales taxes payable		-			1,543			1,543