The OLB Group, Inc., a business services provider, reported a change in its certifying accountant and disclosed material weaknesses in its internal controls over financial reporting. In a recent filing with the Securities and Exchange Commission (SEC), the New York-based company stated that its Audit Committee decided on Monday not to retain Mac Accounting Group & CPAs, LLP (MAC) for future audits and dismissed the firm effective immediately.
During the fiscal year that ended on December 31, 2023, MAC's audit reports on the OLB Group's financial statements did not contain any adverse opinion or disclaimer. There were no disagreements on accounting principles or practices, financial statement disclosure, auditing scope, or procedures that, if unresolved, would have caused MAC to refer to the subject matter of the disagreement in their report.
However, the company acknowledged the identification of material weaknesses in its internal control over financial reporting in its Form 10-K for the year ended December 31, 2023. The nature of these weaknesses was not detailed in the SEC filing.
Concurrent with the dismissal of MAC, the OLB Group's Audit Committee appointed RBSM LLP as the new independent registered public accounting firm. The company confirmed that it had not consulted RBSM on any accounting principles or transactions, nor had there been any disagreements or reportable events with RBSM before their engagement.
This news is based on the company's statement in a press release.
In other recent news, OLB Group, a Fintech eCommerce merchant services provider and cryptocurrency mining enterprise, has made significant strides in its operations. The company has expanded its services through the full acquisition of Black011.com and its associated mobile brands. OLB Group also projects a revenue run rate of at least $15 million for fiscal 2024, despite a revenue loss from the termination of merchant services of an acquired portfolio.
OLB Group has also regained its compliance with Nasdaq's Listing Rule 5550(a)(2) through a reverse stock split of its common stock at a one-for-ten ratio. This move is crucial for the company's continued listing on the exchange.
Regarding the spin-off of its Bitcoin mining subsidiary, DMint, Inc., OLB Group filed an updated registration statement and is in the process of addressing SEC comments. The company will soon announce a Shareholder of Record date for the DMint stock dividend to OLB shareholders.
These recent developments reflect OLB Group's ongoing efforts to maintain its market compliance and financial stability.
InvestingPro Insights
In light of the OLB Group's recent change in their certifying accountant and the disclosure of material weaknesses in internal controls, investors may be scrutinizing the company's financial health and stability. Real-time data from InvestingPro provides a clearer picture of the company's current standing. With a market capitalization of just 5.39 million USD and a troubling P/E ratio of -0.21, reflecting its lack of profitability over the last twelve months, the financial outlook appears challenging. The company's gross profit margin stands at 16.68%, which aligns with the InvestingPro Tip that the OLB Group suffers from weak gross profit margins. Additionally, the stock's price has seen significant volatility, with a 7.72% return over the last week, yet a steep decline of 63.43% over the last six months.
To navigate these turbulent waters, investors may benefit from additional InvestingPro Tips, such as the stock's high price volatility and the fact that its short-term obligations exceed its liquid assets. For those considering a deeper analysis, InvestingPro offers even more insights tailored to the OLB Group's financial metrics. Readers can explore these additional tips by visiting https://www.investing.com/pro/OLB and may use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, unlocking further valuable investment strategies and data points.
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