8-K/A: The Crypto Company Amends Filing to Include Restatement of 2023 and 2024 Financials Following Auditor Bar

The Crypto Company has filed an amendment to its previous 8-K, disclosing that its financial statements for the year ended December 31, 2023, and interim periods of 2024, should no longer be relied upon due to issues with its former independent auditor and potential material weaknesses in internal controls.

Summary

• The Crypto Company filed an Amendment No. 1 to its Current Report on Form 8-K, originally filed on June 9, 2025, to amend and restate its Item 4.02 disclosure.
• The amendment includes the determination that financial statements for the fiscal quarters ended March 31, 2024, June 30, 2024, and September 30, 2024, should no longer be relied upon, in addition to the previously disclosed restatement for the year ended December 31, 2023.
• This non-reliance stems from the Securities and Exchange Commission (SEC) entering an order on May 3, 2024, barring BF Borgers CPA PC, the company's then independent registered public accounting firm, from practicing before the SEC.
• The company dismissed BF Borgers CPA PC on May 8, 2024, and simultaneously engaged Bush & Associates CPA LLC as its new independent registered public accounting firm.
• On March 26, 2025, the board of directors concluded that the company's audited financial statements for the year ended December 31, 2023, should no longer be relied upon and would need to be restated.
• The adjustments for the 2024 interim periods are reflected and discussed in detail in Note 10 to the financial statements included in the company's Annual Report on Form 10-K for the year ended December 31, 2024.
• These matters may represent a material weakness in the company's internal controls.

Sentiment

Score: 3

Explanation: The restatement of multiple periods of financial statements, the dismissal of an auditor due to an SEC bar, and the potential for material weaknesses in internal controls are significant negative events that severely impact the reliability of the company's financial reporting and investor confidence.

Positives

• The company has engaged a new independent registered public accounting firm, Bush & Associates CPA LLC, to ensure future financial reporting integrity.
• Management is working expeditiously to conclude its analysis and complete any required restatement of its financial statements as soon as practicable.

Negatives

• Previously issued financial statements for the year ended December 31, 2023, and the fiscal quarters ended March 31, 2024, June 30, 2024, and September 30, 2024, can no longer be relied upon.
• The company's former independent registered public accounting firm, BF Borgers CPA PC, was barred by the SEC from appearing or practicing as an accountant.
• The issues leading to the restatement may represent a material weakness in the company's internal controls.

Risks

• The matters leading to the financial statement restatement may represent a material weakness in the company's internal controls.
• Reliance on previously issued financial statements for multiple periods (year ended December 31, 2023, and interim periods of 2024) is no longer appropriate, which could impact investor confidence and regulatory compliance.

Future Outlook

The report contains general forward-looking statements language, indicating that actual results may differ materially from any future results expressed or implied, but provides no specific guidance or outlook on future financial performance or operations.

Management Comments

• The Company worked expeditiously to conclude its analysis and complete any required restatement of its financial statements for the periods indicated as soon as practicable.

Industry Context

This announcement highlights the critical importance of independent and reliable auditing in the financial industry, especially for publicly traded companies. The SEC's action against BF Borgers CPA PC underscores regulatory scrutiny on audit quality, which can have significant repercussions for companies relying on such firms. For the broader crypto industry, this emphasizes the need for robust financial controls and transparency to build investor trust.

Comparison to Industry Standards

• The inability to rely on previously issued financial statements for multiple periods falls significantly below industry standards for financial reporting accuracy and reliability.
• The dismissal of an auditor due to an SEC bar against them is a severe event, indicating a failure in a fundamental corporate governance and financial oversight mechanism, unlike well-governed companies that maintain stable and reputable audit relationships.
• The potential for a material weakness in internal controls suggests a deficiency in the company's financial reporting infrastructure, which is a red flag compared to peers with strong internal control environments.

Corporate Governance

Legal Proceedings

• The SEC entered an order on May 3, 2024, barring BF Borgers CPA PC, the company's then independent registered public accounting firm, from appearing or practicing before the SEC as an accountant. This regulatory action directly impacted the company's financial reporting.

Stakeholder Impact

• Shareholders will face uncertainty regarding the accuracy of past financial performance, potentially leading to decreased share price and reduced confidence.
• Regulatory Authorities, particularly the SEC, will likely increase scrutiny of the company's financial reporting and internal controls due to the issues with the former auditor and the subsequent restatement.
• Management and the Board of Directors are tasked with rectifying the financial reporting issues and strengthening internal controls, which will require significant time and resources.
• The new auditor, Bush & Associates CPA LLC, faces the challenge of re-auditing and ensuring the accuracy of complex restated financial statements.

Next Steps

• The company has already filed an amendment to the 2023 Form 10-K to give effect to the restated financial statements.
• The adjustments for the 2024 interim periods are reflected in the company's Annual Report on Form 10-K for the year ended December 31, 2024, and discussed in Note 10 therein.
• Management and the board of directors have discussed these matters with the new independent registered public accounting firm, Bush & Associates CPA LLC.

Key Dates

Recommendation

Keywords

The Crypto Company, SEC filing, 8-K/A, financial restatement, auditor dismissal, BF Borgers CPA PC, Bush & Associates CPA LLC, internal controls, material weakness, financial statements, public accounting firm, corporate governance, regulatory compliance