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REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

6 Months Ended

Jun. 30, 2021

Revision Of Previously Issued Financial Statements

REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

NOTE 2. REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

On April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the SEC together issued a statement regarding the accounting and reporting considerations for warrants issued by special purpose acquisition companies entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Statement”). Specifically, the SEC Statement focused on certain provisions that provided for potential changes to the settlement amounts dependent upon the characteristics of the holder of the warrant, which terms are similar to those contained in the warrant agreement governing the Company’s warrants.

The Company’s management evaluated the warrants under Accounting Standards Codification (“ASC”) Subtopic 815-40, Contracts in Entity’s Own Equity. ASC Section 815-40-15 addresses equity versus liability treatment and classification of equity-linked financial instruments, including warrants, and states that a warrant may be classified as a component of equity only if, among other things, the warrant is indexed to the issuer’s common stock. Under ASC Section 815-40-15, a warrant is not indexed to the issuer’s common stock if the terms of the warrant require an adjustment to the exercise price upon a specified event and that event is not an input to the fair value of the warrant. The Company’s Private Warrants are not indexed to the Company’s common shares in the manner contemplated by ASC Section 815-40-15 because the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares. In addition, the tender offer provision included in the warrant agreement fails the “classified in shareholders’ equity” criteria as contemplated by ASC Section 815-40-25. As a result, the only Private Warrants shall be classified as liabilities and the Public Warrants shall be classified as equity and the Company reevaluated the accounting treatment of the 4,600,000 warrants that were issued to the Company’s sponsor in an initial public offering (“Public Warrants”). The Company previously accounted for the Public Warrants as components of liabilities.

In further consideration of the guidance in Accounting Standards Codification (“ASC”) 815-40, Derivatives and Hedging — Contracts in Entity’s Own Equity (“ASC 815”), the Company concluded that a provision in the warrant agreement related to certain transfer provisions precludes the Private Warrants from being accounted for as components of equity. As the Private Warrants meet the definition of a derivative as contemplated in ASC 815, the Private Warrants should be recorded as derivative liabilities on the balance sheet and measured at fair value at inception (on the date of the Initial Public Offering) and at each reporting date in accordance with ASC 820, Fair Value Measurement, with changes in fair value recognized in the Statements of Operations in the period of change.

The following tables summarize the effect of the revision on each financial statement line item as of the dates, and for the period, indicated:


	As Previously Reported			Adjustments			As Revised
Balance sheet as of February 11, 2021
Warrant Liabilities	$	6,420,000		$	(6,040,000	)	$	380,000
Total Liabilities		7,808,428			(6,040,000	)		1,768,428
Ordinary Shares Subject to Possible Redemption		34,281,198			6,040,004			40,321,202
Ordinary Shares		2,656			(598	)		2,058
Additional Paid-in Capital		5,108,455			596			5,109,051
Total shareholders’ equity		5,000,008			(2	)		5,000,006
Balance sheet as of March 31, 2021
Warrant Liabilities	$	6,450,000		$	(6,060,000	)	$	390,000
Total Liabilities		7,617,136			(6,060,000	)		1,557,136
Ordinary Shares Subject to Possible Redemption		34,155,320			6,059,999			40,215,319
Ordinary Shares		2,668			(600	)		2,068
Additional Paid-in Capital		5,234,320			(19,399	)		5,214,921
Accumulated deficit		(236,985	)		20,000			(216,985	)
Total shareholders’ equity		5,000,003			1			5,000,004
Statements of Operations for the three months ended March 31, 2021
Change in fair value of warrant liabilities	$	(30,000	)	$	20,000		$	(10,000	)
Net income (loss)		(108,323	)		20,000			(88,323	)