Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related
Audit Report or Completed Interim Review.
On November 11, 2022, the Audit Committee of the Board of Directors (the "Audit
Committee") of Bird Global, Inc. (the "Company"), after discussion with
management, determined that (i) the Company's audited consolidated financial
statements as of December 31, 2021 and 2020, and for the years then ended, and
quarterly periods within those years, included in the Annual Report on Form 10-K
filed with the Securities and Exchange Commission (the "SEC") on March 15, 2022,
(ii) its condensed consolidated financial statements as of March 31, 2022, and
for the three months then ended, included in the Quarterly Report on Form 10-Q
filed with the SEC on May 16, 2022 and (iii) its condensed consolidated
financial statements as of June 30, 2022, and for the three and six months then
ended, included in the Quarterly Report on Form 10-Q filed with the SEC on
August 15, 2022 (collectively, the "Original Filings", and each such quarterly
or annual period covered therein, an "impacted period"), should no longer be
relied upon. Similarly, any previously furnished or filed reports, related
earnings releases, investor presentations or similar communications of the
Company describing the Company's financial results contained in the Original
Filings should no longer be relied upon.
The determination results from an error identified in connection with the
preparation of the Company's condensed consolidated financial statements as of
September 30, 2022, and the three and nine months then ended, related to its
business system configuration that impacted the recognition of revenue on
certain trips completed by customers of its Sharing business ("Rides") for which
collectability was not probable. Specifically, for certain customers with
insufficient preloaded "wallet" balances, the Company's business systems
recorded revenue for uncollected balances following the completion of certain
Rides that should not have been recorded. The Company believes the error
resulted in an overstatement of Sharing revenue in the consolidated statements
of operations for the impacted periods and an understatement of deferred revenue
in the consolidated balance sheets as of the end of each impacted period.
The Company intends to amend the Original Filings as soon as practicable. In
connection with the restatement, management has re-evaluated the effectiveness
of the Company's disclosure controls and procedures. Management has concluded
that the Company's disclosure controls and procedures are not effective at a
reasonable assurance level, due to a material weakness in its internal control
over financial reporting related to the ineffective design of controls around
its business systems that resulted in the recording of revenue for uncollected
balances following the completion of certain Rides that should not have been
recorded. The Company is in the process of designing and implementing controls
to remediate these deficiencies.
The Company's management and the Audit Committee have discussed the matters
described in this Current Report on Form 8-K with the Company's independent
registered public accounting firm, Ernst & Young LLP.
Forward-Looking Statements
This Current Report contains forward-looking statements. We intend such
forward-looking statements to be covered by the safe harbor provisions for
forward-looking statements contained in Section 27A of the Securities Act of
1933 (as amended, the "Securities Act"), and Section 21E of the Securities
Exchange Act of 1934 (as amended, the "Exchange Act"). All statements other than
statements of historical facts contained in this Current Report may be
forward-looking statements. Forward-looking statements contained in this Current
Report include, but are not limited to, statements regarding the Company's
expectations regarding the impact of the error and its intention to restate the
Original Filings as soon as practicable. We have based these forward-looking
statements largely on our current expectations. Forward-looking statements
involve known and unknown risks, uncertainties and other important factors that
may cause our actual results, performance or achievements to be materially
different from any future results, performance or achievements expressed or
implied by the forward-looking statements, including, but not limited to, the
important factors discussed in Part I, Item 1A. "Risk Factors" in our Annual
Report on Form 10-K for the year ended December 31, 2021 and Part II, Item 1A.
"Risk Factors" in our Quarterly Report on Form 10-Q for the period ended June
30, 2022, and described from time to time in our future reports filed with the
SEC. The forward-looking statements in this Current Report are based upon
information available to us as of the date of this Current Report, and while we
believe such information forms a reasonable basis for such statements, these
statements are inherently uncertain and investors are cautioned not to unduly
rely upon these statements. Except as required by applicable law, we do not plan
to publicly update or revise any forward-looking statements contained in this
Current Report, whether as a result of any new information, future events or
otherwise.
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