{"url_path":"/sec/kwmww/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/2000756/0001829126-26-005357-index.html","accession_number":"0001829126-26-005357","cik":"0002000756","ticker":"KWM","issuer_name":"Nexus Advanced Technologies Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/2000756/0001829126-26-005357-index.html","primary_entity_key":"0002000756","primary_entity_name":"K Wave Media Ltd."},"word_count":639,"has_tables":true,"body_markdown":"**ITEM 15. CONTROLS AND PROCEDURES**\n\n \n\n**Disclosure Controls and Procedures**\n\n \n\nAs a company with less than US$1.235 billion in revenues for our last fiscal year, we qualify as an “emerging growth company” pursuant to the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include exemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002, in the assessment of the emerging growth company’s internal control over financial reporting. The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards. We have elected to take advantage of such exemptions.\n\n \n\nIn the course of preparing and auditing our consolidated financial statements for the years ended December 31, 2024 and 2025, we and our independent registered public accounting firm identified two material weaknesses in our internal control over financial reporting as of December 31, 2025. The material weaknesses identified relate to:\n\n \n\n(1)\nour lack of sufficient financial reporting and accounting personnel with appropriate knowledge of IFRS and SEC reporting requirements to properly address IFRS technical accounting issues and prepare and review financial statements and related disclosures in accordance with IFRS and reporting requirements set forth by the SEC; and\n\n \n\n(2)\nour lack of formal risk assessment process and internal control framework over financial reporting, including lack of a formal group-wide risk assessment process to identify, assess, address or mitigate the risks in internal control, and lack of sufficient IT general controls designed and implemented surrounding the key financial related systems.\n\n \n\nWe have implemented and plan to implement a number of measures as follows to address the material weaknesses:\n\n \n\n \n(3)\nWe will recruit staff with knowledge of IFRS in our financial reporting department, and are in the process of and establishing an ongoing program to provide sufficient and appropriate training for financial reporting and accounting personnel, especially training related to IFRS and SEC reporting requirement. Currently, we engaged a consulting firm with experience on IFRS and SEC regulations to advise on complex accounting transactions, and standardize our financial reporting function.\n\n \n\n100\n\n \n\n \n\n \n(4)\nWe are continuing to (i) set up system of internal control framework with formal documentation of polices in place, strengthening corporate governance with independent directors and audit committee; (ii) develop a group-wide risk assessment process to allow early detection, prevention and resolution of potential risks related to internal control, and (iii) strengthening the supervision and controls on the IT functions, including the enhancement of IT security policies and procedures setup, logical security, data backup and cyber security training.\n\n \n\nHowever, we cannot assure you that we will remediate our material weaknesses in a timely manner.*See “Risk Factors - Risks Relating to K Wave’s Business - K Wave’s management has identified material weaknesses in K Wave’s internal control over financial reporting and K Wave may not be able to remediate these weaknesses. Additionally, K Wave’s management may identify material weaknesses in the future that could adversely affect investor confidence, impair the value of K Wave’s securities, and increase K Wave’s cost of raising capital.”*\n\n \n\n**Management’s Annual Report on Internal Control over Financial Reporting**\n\n \n\nNot applicable.\n\n \n\n**Attestation Report of the Registered Public Accounting Firm**\n\n \n\nAs an emerging growth company, we are not required at this time to comply with the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002 concerning the assessment of our internal controls over financial reporting.\n\n \n\n**Changes in Internal Control over Financial Reporting**\n\n \n\nAs permitted for newly public companies during the transition period, we are not required to provide disclosure regarding changes in internal control over financial reporting for the period covered by this report.\n\n \n\n101"}