Armanino LLP, a top 25 US accounting and consulting firm, had audited Lottery.com’s financial statements for the year ending 31 December 2021. However, the business submitted a resignation letter on 27 September 2022.
The auditors had previously been the party that discovered a line of credit which a subsidiary of the business had entered into and then did not record in any financial statements.
This unrecorded line of credit was the cause of a $30m shortfall in the business’s accounts. In July, the shortfall was made public following Armanino informing the company on the discrepancies with its financial statements. This was followed by the resignation of its president, treasurer and chief financial officer Ryan Dickinson. The company’s CEO Tony DiMatteo III also resigned soon afterwards.
“The company, in consultation with its outside advisors, is currently validating its preliminary conclusion, assessing any impact on previously issued financial reports, and has begun to institute appropriate remedial measures,” said Lottery.com on that occasion.
Lottery.com stated in a SEC filing that the firm had signed off to its December financial report without incident: “Armanino’s report… did not contain an adverse opinion or disclaimer of opinion, nor was it qualified or modified as to uncertainty, audit scope or accounting principles,” it stated.
“In addition, there were no disagreements between the company and Armanino on accounting principles or practices, financial statement disclosure or auditing scope or procedure, which, if not resolved to the satisfaction of Armanino, would have caused them to make reference to the disagreement in their report for such period, or any subsequent interim period preceding Armanino’s resignation.”
The company has not yet chosen a successor accounting firm.
New board members
Lottery.com also announced that the company’s new board members Vladimir Klechtchev and Amer Rustom, which were appointed in keeping with the NASDAQ minimum board members rules, have been given committee assignments.
Klechtchev will act as chairman and Rustom as member of the audit committee. Both will be members of the compensation committee, of which Richard Kivel is the chairman.
Original article: https://igamingbusiness.com/legal-compliance/lottery-com-auditors-resign/
