{"url_path":"/sec/cdtg/10-k/2026/item-15","section_key":"item-15","section_title":"Item 15 CONTROLS AND PROCEDURES**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-15","source_url":"https://www.sec.gov/Archives/edgar/data/1793895/0001731122-26-000740-index.html","accession_number":"0001731122-26-000740","cik":"0001793895","ticker":"CDTG","issuer_name":"CDT Environmental Technology Investment Holdings Ltd","edgar_url":"https://www.sec.gov/Archives/edgar/data/1793895/0001731122-26-000740-index.html","primary_entity_key":"0001793895","primary_entity_name":"CDT Environmental Technology Investment Holdings Ltd"},"word_count":1194,"has_tables":true,"body_markdown":"**ITEM 15. CONTROLS AND PROCEDURES**\n\n \n\n**Disclosure Controls and Procedures**\n\n \n\nUnder the supervision and with\nthe participation of our management, including our chief executive officer and our chief financial officer, we carried out an evaluation\nof the effectiveness of our disclosure controls and procedures, which is defined in Rules 13a-15(e) of the Exchange Act, as of the end\nof the period covered by this annual report. Based upon that evaluation, our management, with the participation of our chief executive\nofficer and chief financial officer, has concluded that, due to the material weaknesses described below under “Item 15. Controls\nand Procedures-Changes in Internal Control Over Financial Reporting”, as of the end of the period covered by this annual report,\nour disclosure controls and procedures were not effective in ensuring that the information required to be disclosed by us in this annual\nreport is recorded, processed, summarized and reported to them for assessment, and required disclosure is made within the time period\nspecified in the rules and forms of the SEC.\n\n \n\n103\n\n \n\n \n\n**Management’s Annual Report on Internal Control\nover Financial Reporting and Attestation Report of Registered Public Accounting Firm**\n\n \n\nOur management is responsible for\nestablishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting, as defined\nin Rules 13a-15(f) and 15d-15(f) of the Exchange Act, is a process designed by, or under the supervision of,\nour chief executive officer and our chief financial officer, and effected by our board of directors, management and other personnel, to\nprovide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external\npurposes in accordance with generally accepted accounting principles. Internal control over financial reporting includes those policies\nand procedures that:\n\n \n\n \n●\npertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;\n\n \n\n \n●\nprovide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and our board of directors; and\n\n \n\n \n●\nprovide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.\n\n \n\nInternal control over financial\nreporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations. Internal\ncontrol over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns\nresulting from human failures. Internal control over financial reporting can also be circumvented by collusion or improper override. Because\nof such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control\nover financial reporting. However, these inherent limitations are known features of the financial reporting process, and it is possible\nto design into the process safeguards to reduce, though not eliminate, this risk.\n\n \n\nOur management assessed the effectiveness\nof our internal control over financial reporting as of December 31, 2025. In making its assessment, management used the criteria described\nin *Internal Control-Integrated Framework* (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission\n(COSO). Based on its assessment, management has concluded that our internal control over financial reporting was ineffective as of December\n31, 2025 based on the material weaknesses described below. A “material weakness” is a deficiency, or a combination of deficiencies,\nin internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the company’s\nannual or interim financial statements will not be prevented or detected on a timely basis.\n\n \n\nIn the course of auditing our consolidated\nfinancial statements as of and for the year ended December 31, 2025, we and our independent registered public accounting firm identified\ntwo material weaknesses in our internal control over financial reporting. As defined in standards established by the Public Company Accounting\nOversight Board (United States), a “material weakness” is a deficiency, or a combination of deficiencies, in internal control\nover financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial\nstatements will not be prevented or detected on a timely basis.\n\n \n\nThe material weaknesses identified\nrelate to (1) our lack of sufficient skilled staff with U.S. GAAP knowledge and the SEC reporting knowledge for the purpose of financial\nreporting as well as the lack in formal accounting policies and procedures manual to ensure proper financial reporting in accordance with\nU.S. GAAP and SEC reporting requirements; and (2) our lack of internal audit function to establish formal risk assessment process and\ninternal control framework.\n\n \n\nWe are currently in the process\nof remediating the material weaknesses described above and we intend to continue implementing the following measures, among others, to\nremediate the material weaknesses. We are seeking to remediate these material weaknesses by, among others, actively hiring more qualified\naccounting personnel.\n\n \n\nAs we were in the process of implementing\nsuch remedial measures as of December 31, 2025, our management concluded that the material weaknesses had not been fully remediated and\nthat such material weaknesses still existed.\n\n \n\n104\n\n \n\n \n\nWe are fully committed to continuing\nto implement measures to remediate our material weaknesses and significant deficiencies in our internal control over financial reporting.\nHowever, we cannot assure you that we will remediate our material weaknesses and significant deficiencies in a timely manner. We and our\nindependent registered public accounting firm were not required to perform an evaluation of our internal control over financial reporting\nas of December 31, 2025. Neither we nor our independent registered public accounting firm undertook a comprehensive assessment of our\ninternal control over financial reporting under the Sarbanes-Oxley Act for the purposes of identifying and reporting any material weakness\nor significant deficiency in our internal control over financial reporting. Had we performed a formal assessment of our internal control\nover financial reporting or had our independent registered public accounting firm performed an audit of our internal control over financial\nreporting, additional material weaknesses and significant deficiencies may have been identified. See “Item 3. Key Information-D.\nRisk Factors-Risks Related to Our Business-If we fail to implement and maintain an effective system of internal control, we may be unable\nto accurately report our operating results, meet our reporting obligations or prevent fraud.”\n\n \n\nAs a Company with less than $1.235\nbillion in revenue during our last fiscal year, we qualify as an “emerging growth company” as defined in the Jumpstart Our\nBusiness Startups Act, or JOBS Act, enacted in April 2012, and may take advantage of reduced reporting requirements that are otherwise\napplicable to public companies. These provisions include, but are not limited to, not being required to comply with the auditor attestation\nrequirements in the assessment of our internal control over financial reporting.\n\n \n\nOther than as described above,\nthere were no changes in our internal controls over financial reporting identified in connection with the evaluation required by Rules\n13a-15 or 15d-15 that occurred during the period covered by this annual report that has materially affected, or is reasonably likely to\nmaterially affect, our internal control over financial reporting."}