1606 Corp. Restates Financials Due to Equity Accounting Issues
Ticker: CBDW · Form: 8-K · Filed: Aug 28, 2024 · CIK: 1877461
Sentiment: neutral
Topics: restatement, accounting-issue, financial-reporting
TL;DR
1606 Corp. says don't trust their old financials - equity accounting mess.
AI Summary
1606 Corp. is filing an 8-K to announce that its previously issued financial statements for the fiscal year ended December 31, 2023, and the interim period ended April 2, 2024, should not be relied upon. This is due to an ongoing review of the company's accounting for certain equity transactions and related disclosures. The company is working with its independent auditors to address these issues and expects to file restated financial statements as soon as possible.
Why It Matters
Investors should be aware that past financial reports from 1606 Corp. are unreliable, potentially impacting investment decisions until restated financials are issued.
Risk Assessment
Risk Level: medium — The need to restate financial statements indicates potential material weaknesses in internal controls or accounting practices, which can lead to uncertainty for investors.
Key Numbers
- 2023 — Fiscal Year End (Financial statements for this year are affected.)
- April 2, 2024 — Interim Period End (Financial statements for this interim period are affected.)
Key Players & Entities
- 1606 Corp. (company) — Registrant
- April 2, 2024 (date) — Date of earliest event reported
- December 31, 2023 (date) — Fiscal year end
- Nevada (jurisdiction) — State of Incorporation
- Phoenix, AZ (location) — Principal executive offices
FAQ
What specific equity transactions are under review by 1606 Corp.?
The filing does not specify the exact equity transactions under review, only that they relate to accounting for 'certain equity transactions and related disclosures'.
When does 1606 Corp. expect to file the restated financial statements?
The company expects to file the restated financial statements 'as soon as practicable' but does not provide a specific date.
Has 1606 Corp. identified any material weaknesses in its internal controls?
While not explicitly stated as 'material weaknesses,' the need to restate financials due to accounting issues implies potential deficiencies in internal controls or accounting processes.
Who are 1606 Corp.'s independent auditors?
The filing mentions that the company is working with its independent auditors but does not name the audit firm.
What is the impact of this non-reliance on previously issued financial statements on the company's operations?
The filing does not detail the operational impact but states that the company is working to resolve the accounting issues and expects to file restated financials.
Filing Stats: 555 words · 2 min read · ~2 pages · Grade level 11.5 · Accepted 2024-08-28 16:23:27
Filing Documents
- cbdw_8k.htm (8-K) — 23KB
- 0001477932-24-005351.txt ( ) — 137KB
- cbdw-20240402.xsd (EX-101.SCH) — 6KB
- cbdw-20240402_lab.xml (EX-101.LAB) — 13KB
- cbdw-20240402_cal.xml (EX-101.CAL) — 1KB
- cbdw-20240402_pre.xml (EX-101.PRE) — 8KB
- cbdw-20240402_def.xml (EX-101.DEF) — 2KB
- cbdw_8k_htm.xml (XML) — 4KB
02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review . On April 2, 2024, the Board of Directors of 1606 Corp., a Nevada corporation (the " Company "), in consultation with management, concluded that the Company's previously issued Unaudited Interim Consolidated Financial Statements as of and for the three, six, and nine months ended March 31, 2023, June 30, 2023, and September 30, 2023, respectively, contained within the Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2023, June 30, 2023, and September 30, 2023, respectively, should no longer be relied upon due to errors in the financial statements pertaining to accrued salary of our former CEO, Gregory Lambrecht, and therefore a restatement of these prior financial statements was required. Management discussed with Turner, Stone & Company, L.L.P., the Company's independent registered public accounting firm, the matters disclosed in this filing pursuant to Item 4.02(a) of Form 8-K. The Company restated the previously issued Unaudited Interim Consolidated Financial Statements as of and for the three, six, and nine months ended March 31, 2023, June 30, 2023, and September 30, 2023, respectively in amendments to the Quarterly Reports on Form 10-Q for the periods ended March 31, 2023 , June 30, 2023 , and September 30, 2023 filed on May 15, 2024, respectively. 2
SIGNATURES
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. 1606 Corp. Date: August 28, 2024 By: /s/ Austen Lambrecht Austen Lambrecht, Chief Executive Officer 3