8-K: Data443 Risk Mitigation Changes Accounting Firms: Appoints HTL International, Dismisses TPS Thayer

Data443 Risk Mitigation, Inc. announces the dismissal of TPS Thayer, LLC and the engagement of HTL International, LLC as its new independent registered public accounting firm, effective February 14, 2025.

Summary

• Data443 Risk Mitigation, Inc. has dismissed TPS Thayer, LLC as its independent registered public accounting firm on February 14, 2025.
• The reports from TPS Thayer for the fiscal years ended December 31, 2023 and 2022, contained an explanatory paragraph related to the company's ability to continue as a going concern but did not contain an adverse opinion or disclaimer of opinion.
• The decision to change accounting firms was approved by the Company's Board of Directors.
• There were no disagreements with TPS Thayer on accounting principles, practices, financial statement disclosure, or auditing scope or procedure, except for material weaknesses related to reconciliation of various accounts.
• Effective February 14, 2025, Data443 Risk Mitigation, Inc. engaged HTL International, LLC as its new independent registered public accounting firm.
• The Company had not consulted with HTL regarding the application of accounting principles, the type of audit opinion, or any matter that was the subject of a disagreement during the two most recent fiscal years and through December 31, 2024.

Sentiment

Score: 5

Explanation: Neutral sentiment as it primarily involves a change in accounting firms. The going concern mention is a slight negative.

Positives

• The transition to a new accounting firm appears to be amicable, with no reported disagreements on critical accounting matters.
• TPS Thayer agreed with the disclosures made by the Company regarding their dismissal.

Negatives

• TPS Thayer's reports for 2022 and 2023 included an explanatory paragraph about the company's ability to continue as a going concern, which is a cause for concern.

Risks

• The change in accounting firms could potentially lead to increased scrutiny from regulators or investors.
• The material weaknesses related to reconciliation of various accounts, as identified by TPS Thayer, could indicate underlying financial reporting issues.

Industry Context

Changes in accounting firms are not uncommon, but they can sometimes signal underlying issues or a desire for a fresh perspective on financial reporting. Investors often pay close attention to these changes, especially when the previous auditor raised concerns about the company's ability to continue as a going concern.

Stakeholder Impact

• Shareholders may be concerned about the change in accounting firms and the previous auditor's going concern statement.
• Employees in the finance and accounting departments may experience changes in workload or responsibilities due to the new auditor.

Key Dates