REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
|8 Months Ended|
Sep. 30, 2021
|REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS|
|REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS||
NOTE 2. REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
In connection with the preparation of the Company’s financial statements as of September 30, 2021, management identified errors made in its historical financial statements where, at the closing of the Company’s Initial Public Offering, the Company improperly valued its Class A common stock subject to possible redemption. The Company previously determined the Class A common stock subject to possible redemption to be equal to the redemption value of $10.00 per share Class A common stock while also taking into consideration a redemption cannot result in net tangible assets being less than $5,000,001. Management determined that the Class A common stock issued during the Initial Public Offering can be redeemed or become redeemable subject to the occurrence of future events considered outside the Company’s control. Therefore, management concluded that the redemption value should include all shares of Class A common stock subject to possible redemption, resulting in the Class A common stock subject to possible redemption being equal to their redemption value. In accordance with SEC Staff Accounting Bulletin No. 99, “Materiality,” and SEC Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements;” the Company evaluated the changes and has determined that the related impact was not material to any previously presented financial statements. Therefore, the Company, in consultation with its Audit Committee, concluded that its previously issued financial statements should be revised to report all public shares as temporary equity. This resulted in an adjustment to the initial carrying value of the Class A common stock subject to possible redemption with the offset recorded to additional paid-in capital (to the extent available), accumulated deficit and Class A common stock.
The impact of the revision on the Company’s financial statements is reflected in the following table.
The impact of the revision to the unaudited condensed balance sheet as of June 30, 2021, is a reclassification of $18,976,490 million from total stockholders’ equity to Class A common stock subject to possible redemption.
In connection with the change in presentation for the Class A ordinary shares subject to possible redemption, the Company also revised its earnings per share calculation to allocate income and losses shared pro rata between the two classes of shares. This presentation contemplates a Business Combination as the most likely outcome, in which case, both classes of shares share pro rata in the income and losses of the Company.
The impact on the reported amounts of basic and diluted net income (loss) per share was a decrease of $0.17 per redeemable share and an increase of $0.01 per non-redeemable share to a loss of $0.17 per share for both redeemable and non-redeemable shares, and decrease of $0.17 per redeemable share and a increase of $0.08 per non-redeemable share to $0.17 per share for both redeemable and non-redeemable shares, for the three months ended June 30, 2021, and for the period from February 12, 2021 (inception) through June 30, 2021, respectively
The entire disclosure for reporting error correction.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef