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Restatment of Previously Issued Financial Statements

9 Months Ended

Sep. 30, 2022

Restatement of Previously Issued Financial Statements [Abstract]

RESTATMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

1A. RESTATMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

The Company concluded it should restate its previously issued financial statements by amending its Quarterly Report on Form 10-Q for the quarterly periods ended March 31, 2022 (filed with the Securities and Exchange Commission (the “SEC”) on May 12, 2022) and June 30, 2022 (filed with the SEC on August 11, 2022) to reflect the accrual of approximately $222,000 of deferred compensation expense (consisting of earned and unused paid time off) during the first quarter of 2022. This change increases the Company’s administrative expenses and accrued expenses by approximately $222,000 with no impact on its cash position. There has been no change to previously disclosed product sales.

In accordance with SEC Staff Accounting Bulletin No. 99, “Materiality,” and SEC Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” the Company evaluated the correction and has determined that the related impact was material to the previously issued financial statements that contained the error reported in the Company’s Form 10-Q for the quarterly periods ended March 31, 2022 and June 30, 2022 (the “Affected Quarterly Periods”). Therefore, the Company concluded that the Affected Quarterly Periods should be restated to present the reclassification.

The $222,379 decrease in net income (loss) during the three-month period ended March 31, 2022 and six-month period ended June 30, 2022 lead to a corresponding reduction in the Company’s reported accumulated deficit at March 31, 2022 and June 30, 2022. The restatement had no impact on the net operating loss, net loss, or related per-share amounts during the three-month period ended June 30, 2022. The tables below show the impact of these changes on the Statement of Operations:

	As Reported		Adjustment			As Restated
Unaudited Statement of Operations During the Three-Month Period Ended March 31, 2022
Net operating income	$	792,988	$	(222,379	)	$	570,609
Net Income	$	735,666	$	(222,379	)	$	513,287
Basic net income per share	$	0.10	$	(0.03	)	$	0.07
Diluted net income per share	$	0.09	$	(0.02	)	$	0.07

	As Reported		Adjustment			As Restated
Unaudited Statement of Operations During the Six-Month Period Ended June 30, 2022
Net operating income (loss)	$	173,980	$	(222,379	)	$	(48,399	)
Net Income (loss)	$	51,518	$	(222,379	)	$	(170,861	)
Basic net income (loss) per share	$	0.01	$	(0.03	)	$	(0.02	)
Diluted weighted average common shares outstanding		7,781,403		(38,053	)		7,743,350
Diluted net income (loss) per share	$	0.01	$	(0.03	)	$	(0.02	)