CEVA » Topics » Evaluation of Disclosure Controls and Procedures

This excerpt taken from the CEVA 10-K filed Mar 16, 2007.
Evaluation of Disclosure Controls and Procedures
 
As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in this report.
 
There has been no change in our internal control over financial reporting that occurred during our most recent fiscal quarter that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.


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Table of Contents

 
This excerpt taken from the CEVA 10-K filed Mar 14, 2006.

Evaluation of Disclosure Controls and Procedures

Our management evaluated, with the participation of our chief executive officer and chief financial officer, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) during the period covered by this Annual Report on Form 10- K. Disclosure controls are procedures that are (1) designed to ensure that information relating to CEVA, including our consolidated subsidiaries, is made known to them by others within those entities, particularly in the period in which this report was being prepared and (2) effective, in that they provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

As we disclosed in our 10-K/A filed with the SEC on April 26, 2005 (the “10-K/A”), we identified a material weakness under standards established by the Public Company Accounting Oversight Board relating to our revenue recognition treatment of a certain license upgrade agreement. During the first quarter of 2005, we began analyzing the steps to be taken to remediate this  material weakness . Under the direction of our Audit Committee and with the participation of our senior management, we have completed the following remediation actions during the first nine months of 2005 to strengthen our disclosure controls and procedures and internal controls to address the above referenced material weakness:



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set up procedures to ensure that a comprehensive review of all past and future agreements is undertaken when we enter into a new revenue generating agreement with a customer where we have an existing relationship with this party, such as an existing customer, supplier or service provider relationship;

·

retained a third party accounting firm to consult on complicated technical accounting issues; and

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ensured that our accounting and finance personnel attend U.S. G.A.A.P courses on revenue recognition policies.

We believe the corrective steps taken to improve our disclosure controls and procedures and internal controls described above have enabled our  chief executive officer and chief financial officer to conclude that our disclosure controls and procedures  as of the end of the period covered by this Annual Report on Form 10-K are effective.

While we believe that these corrective actions, taken as a whole, remediate the material weakness referenced above, a control system, no matter how well designed or operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in any control systems, no evaluation of controls and procedures can provide absolute assurance that all control issues and instances of fraud, if any, will be detected on a timely basis. These inherent limitations include the possibility that judgments in decision-making can be faulty and that breakdowns can occur because of errors or mistakes. Our disclosure controls and procedures can also be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Furthermore, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

EXCERPTS ON THIS PAGE:

10-K
Mar 16, 2007
10-K
Mar 14, 2006
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