Fiduciary Accounting – Berning CPA http://berningcpa.com/ Tue, 22 Nov 2022 03:05:00 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://berningcpa.com/wp-content/uploads/2021/05/default-150x150.png Fiduciary Accounting – Berning CPA http://berningcpa.com/ 32 32 Law Firm Pomerantz Investigating Claims on Behalf of Vintage Wine Estates, Inc. -VWE Investors https://berningcpa.com/law-firm-pomerantz-investigating-claims-on-behalf-of-vintage-wine-estates-inc-vwe-investors/ Tue, 22 Nov 2022 03:05:00 +0000 https://berningcpa.com/law-firm-pomerantz-investigating-claims-on-behalf-of-vintage-wine-estates-inc-vwe-investors/ NEW YORK, November 21, 2022 /PRNewswire/ — Pomerantz LLP is investigating claims on behalf of investors in Vintage Wine Estates, Inc. (“Vintage” or the “Company”) (NYSE: VWE). Such investors are advised to contact Robert S. Willoughby at [email protected] or 888-476-6529 ext. 7980. The investigation focuses on whether Vintage and certain of its officers and/or directors […]]]>

NEW YORK, November 21, 2022 /PRNewswire/ — Pomerantz LLP is investigating claims on behalf of investors in Vintage Wine Estates, Inc. (“Vintage” or the “Company”) (NYSE: VWE). Such investors are advised to contact Robert S. Willoughby at [email protected] or 888-476-6529 ext. 7980.

The investigation focuses on whether Vintage and certain of its officers and/or directors have engaged in securities fraud or other illegal business practices.

[Click here for information about joining the class action]

On September 13, 2022Vintage disclosed that certain of the Company’s previously released financial statements should no longer be relied upon and should be restated due to the identification of an accounting error related to the treatment of interest rate swap agreements.

At this news, Vintage’s share price plummeted. $2.23 per share, or 40.33%, to close at $3.30 per share on September 14, 2022.

Pomerantz LLP, with offices in New York, Chicago, Los Angeles, Parisand Tel Aviv, is recognized as one of the leading firms in the areas of corporate litigation, securities and antitrust. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues the tradition he established, fighting for the rights of victims of securities fraud, breaches of fiduciary duty and corporate misconduct. The firm recovered numerous multimillion-dollar damages on behalf of class members. See www.pomlaw.com

CONTACT:
Robert S. Willoughby
Pomerantz LLP
[email protected]
888-476-6529 ext. 7980

SOURCE Pomerantz LLP

]]>
Singing in front of a surprisingly interesting company seminar https://berningcpa.com/singing-in-front-of-a-surprisingly-interesting-company-seminar/ Sat, 19 Nov 2022 16:10:00 +0000 https://berningcpa.com/singing-in-front-of-a-surprisingly-interesting-company-seminar/ What can I expect from a 2.5 day conference on board governance? How could the fine folks at accounting and consulting firm Crowe LLP capture the attention of a room full of non-accountants on such an incredibly dry topic? In fact, I’d bet I’ve lost a lot of readers so far in this week’s column. […]]]>

What can I expect from a 2.5 day conference on board governance?

How could the fine folks at accounting and consulting firm Crowe LLP capture the attention of a room full of non-accountants on such an incredibly dry topic?

In fact, I’d bet I’ve lost a lot of readers so far in this week’s column. For those who are still here, I’m going to make this as painless as possible. Maybe even interesting,

The first thing Crowe did to attract people to the event was to hold it at the River Cree Resort and Casino on the western outskirts of Edmonton. This spectacular facility rivals the casinos on the Vegas Strip (I’ve been to both, so I’m qualified to judge, LOL).

“We, the Enoch Cree Nation, a proud member of Treaty 6, actively seek to preserve and promote our culture, language, history and spirituality while advancing our economy, education, health and social well-being. of our people,” briefing materials state. . “Enoch Cree Nation believes that a strong economy leads to a stronger nation, and its efforts to promote the nation’s economic interests have effectively brought it closer to its goal of self-sufficiency.

Cree history and culture was presented in a subtle and interesting way throughout the casino and hotel. It was inspiring for me to see this Indigenous-owned business development and also to interact with the many First Nations people employed there.

Oh wait…I’m supposed to write about board governance, not my constant bad luck at some of the 1,400 new slot machines and the handful of old-school VLT poker machines (the latter which I found in the smoking/vaping section of the casino).

Crowe organizers were delighted with the attendance, even opening up extra places after the first places filled up.

Who was there? Well, the general manager of Canarctic Graphics, Sean Crowell — vice-president of the Northwest Territories Chamber of Commerce — was there with me. We were joined by a selection of groups representing a variety of board structures – private companies, member organizations such as the NWT Chamber and many government boards and Aboriginal governments. For example, Sean and I were sitting at a table with a group of leaders from the Tłıicho community of Gameti — 237 km northwest of Yellowknife — and there were many others from as far Nunavut.

Injected humor

The presenters at the conference were clearly experts in their fields and also very comfortable answering a variety of questions. They kept things going and peppered their presentations with appropriate jokes and jokes.

This type of conference aims to provide board members with the skills and confidence to fully engage with each other, with their staff, and with the public. So we learned the basics of effective governance, board structures, legal responsibilities and fiduciary duties.

I was interested in some of the tips for record keeping and task tracking, as well as the structure of an effective board and the types of committees it should have.

Conclusion: Board members oversee and jointly supervise the activities of an organization. Directors have a fiduciary duty to the company and must always act in the best interests of the company. There are rules to follow and good practices to consider, adapt and implement. The better the board, the better the organization.

One of the PowerPoint slides contained this sentence: “Control what you can, influence what you cannot control”. Some of you will see the similarity of this risk management mantra to the serenity prayer found in 12-step programs: “…accept the things I cannot change, courage to change the things I I can… “

The prayer goes one step further than the biz mantra: “And the wisdom to know the difference.” That, to me, is the key.

At this point in my career, I’m lucky to have buckets of wisdom — from all those good and (woe be me!) several bad decisions made so far in my life — to draw on in my relatively new CEO of the NWT Chamber.

That, along with the current board members – who have a passion for the NWT Chamber and now boast a vice-president with lots of new backgrounds to weigh in – should go a long way in providing excellent service to our members as the NWT Chamber. is heading towards its 50th anniversary in 2023.

]]>
Homeowner Association Leadership Best Practices https://berningcpa.com/homeowner-association-leadership-best-practices/ Wed, 16 Nov 2022 17:30:14 +0000 https://berningcpa.com/homeowner-association-leadership-best-practices/ Wednesday, November 16, 2022 About 74.1 million Americans reside in a housing estate, condominium complex or other planned community administered by a community association. Community associations are governed by a board of directors, which is usually made up of community volunteers who are elected by their co-owners. The board manages the corporate affairs of the […]]]>

About 74.1 million Americans reside in a housing estate, condominium complex or other planned community administered by a community association.

Community associations are governed by a board of directors, which is usually made up of community volunteers who are elected by their co-owners. The board manages the corporate affairs of the association and therefore can often become a lightning rod for dissatisfied owners. This can lead to lawsuits against board members for alleged breach of their fiduciary responsibilities to the community association. The threat of being involved in legal action can often deter homeowners from wanting to serve on the board of directors of their community association.

Board members who follow best practices can avoid many problems, including getting involved in legal actions. Best practices not only benefit the board and its members, but the community association as a whole.

Below are the most useful best practices for a community association board to use.

Be transparent and accessible

Communicating effectively with other administrators, owners and professionals hired by the association to help manage the community is essential. Each board should develop a communications strategy that includes, at a minimum, the following elements:

  • Communicate the agenda of Board and Membership meetings well in advance to all owners and encourage owners to attend.

  • Communicate regularly with the owners about the board’s current plans and progress, including the financial health of the association.

  • Provide owners with information about issues important to owners and how the council intends to address these issues.

  • Consistent director attendance at all meetings, with thorough discussion of all agenda items and votes, for or against, on every decision requiring a director vote.

  • Publish minutes of board and member meetings in a timely manner.

  • Provide a method for owners to contact the board outside of meetings.

Communication methods may include personal contact, informational meetings, printed newsletters, e-mail or website. Transparency builds trust, which is the key to strong communication.

Be ethical and irreproachable

Directors should strive to be above reproach and positively avoid actions and comments that could create the appearance of unethical behavior. Each board member should strive to:

  • Avoid personal agendas and apply the provisions of the community’s governing documents consistently.

  • Use good judgment to make decisions that are in the best interest of the association, taking into account all available information, circumstances and resources.

  • Avoid conflicts of interest or even the appearance of a conflict. A conflict of interest arises when a director has a direct or indirect interest, not shared by all board members, in a transaction conducted with the association.

    • A director has a direct interest in a transaction with the association when the director, or a member of his immediate family, has either a material financial interest in the transaction or a relationship with other parties to the transaction whose it can reasonably be expected to affect the director’s judgment in a manner adverse to the association and its members as a whole.

    • A director has an indirect interest in a transaction with the association when an entity in which the director has a personal and material financial interest, or in which the director is a director, officer or trustee, is a party to the transaction.

    • If a director is unsure whether a conflict exists, they should present all relevant information and facts to the other directors and be prepared to refrain from participating in the discussion of the matter under consideration. or vote on it.

  • Be familiar with the laws, rules, regulations and registered documents that govern the association. The director shall not advocate or support any action or activity that is inconsistent with the rules, regulations or terms of the governing documents.

By demonstrating ethics and integrity, a director can help build trust among members in the board.

Be reasonable

A director must always take his responsibilities to the association seriously, exercise good judgment and not hesitate to rely on simple common sense. Discussions with owners and other directors should be respectful even if individuals disagree with each other; and, most importantly, but difficult, even when an owner or other administrator acts disrespectfully.

Good judgment is essential and is perhaps one of the most crucial assets required of a director. To exercise good judgment, a director must think clearly, calmly and in an orderly manner in order to be able to make a good decision.

More importantly, a director must consider all facts and opinions so that every decision is fair and reasonable under the circumstances. If a topic requires further investigation, research, or discussion, the director must recognize the need and advocate for it, including involving professionals on matters that are outside the board’s expertise.

In other words, directors must apply their own experience and general knowledge to each situation in order to make the best decision under the circumstances, but also recognize their limitations and bring in experts to supplement as needed.

Be financially responsible

Financial stability is essential to the success of an association. A director should always seek to establish sound tax policies, help develop a viable budget, and continually seek ways to achieve the goals of the association in a responsible manner.

A director should seek the advice of professionals such as community association managers, legal professionals, accountants and financial advisers. The right professionals can help the board develop accounting controls to protect association assets, realistic budgets that ensure operating funds are sufficient to cover ordinary association expenses, and detailed reserve studies to provide sufficient capital for any future or unforeseen expenses. .

Owners generally don’t like the increase in assessments and are asking the board to look at ways to cut costs and budget effectively. However, higher appraisals are sometimes unavoidable, and if the board can gradually increase appraisals and have strong reserves for unavoidable expenses and replacement costs, many of these problems can be avoided.

Conclusion

Directors of community associations play a very important role in the successful administration, management and operation of the association. A successful director will be open and honest, ethical, reasonable and financially prudent.

© 2022 Ward and Smith, Pennsylvania. All rights reserved.National Law Review, Volume XII, Number 320

]]>
SHAREHOLDER ALERT: Weiss Law is investigating Oyster Point Pharma, Inc. https://berningcpa.com/shareholder-alert-weiss-law-is-investigating-oyster-point-pharma-inc/ Tue, 08 Nov 2022 07:13:00 +0000 https://berningcpa.com/shareholder-alert-weiss-law-is-investigating-oyster-point-pharma-inc/ NEW YORK, November 7, 2022 /PRNewswire/ — Weiss’ law investigation of possible breaches of fiduciary duty and other violations of law by the board of directors of Oyster Point Pharma, Inc. (“Oyster Point” or the “Company”) OYSTas part of the proposed acquisition of the Company by Viatris Inc. TRV by public takeover bid. Under the […]]]>

NEW YORK, November 7, 2022 /PRNewswire/ —

Weiss’ law investigation of possible breaches of fiduciary duty and other violations of law by the board of directors of Oyster Point Pharma, Inc. (“Oyster Point” or the “Company”) OYSTas part of the proposed acquisition of the Company by Viatris Inc. TRV by public takeover bid. Under the terms of the merger agreement, shareholders of the Company will receive $11.00 in cash for each common share of Oyster Point held, plus a contingent value right (“CVR”) representing the right to receive a potential cash payment of up to $2.00 per share.

If you own oyster tip actions and wish to discuss this survey or have questions about this notice or your rights or interests, visit our website:

https://www.weisslaw.co/news-and-cases/oyst
Or please contact:
Joshua Rubin, Esq.
Weiss’ law
305 Broadway, 7e Floor
New YorkNY 10007
(212) 682-3025
(888) 593-4771
stockinfo@weisslawllp.com

Weiss Law is investigating whether (i) Oyster Point’s board of directors acted in the best interests of the company’s shareholders in agreeing to the proposed transaction, (ii) the $11.00 the merger consideration per share adequately compensates Oyster Point shareholders, and (iii) all information regarding the sale process and valuation of the transaction will be fully and fairly disclosed. In particular, the merger consideration is less than the $21 median price target set by analysts, and at least one analyst has set a price target for the Company of $65 per share, $54.00 above the merger price per share.

Weiss Law has litigated hundreds of shareholder class and derivative actions for breach of corporate and fiduciary duties. We’ve recovered more than $1 billion for defrauded customers and won significant corporate governance relief in many of those cases. If you have information or want legal advice regarding possible corporate wrongdoing (including insider trading, waste of company assets, accounting fraud or misleading information), fraud consumer rights (including false advertising, defective products or other deceptive marketing practices), or anti-trust violations, please email us at stockinfo@weisslawllp.com

Show original content to download multimedia:https://www.prnewswire.com/news-releases/shareholder-alert-weiss-law-investigates-oyster-point-pharma-inc-301670973.html

SOURCE Weiss’ Law

]]>
Peru Hires New CFO – Shaw Local https://berningcpa.com/peru-hires-new-cfo-shaw-local/ Fri, 04 Nov 2022 10:25:00 +0000 https://berningcpa.com/peru-hires-new-cfo-shaw-local/ Tracy Mitchell, of Peruwas hired as the new financial director of the city of Peru at the beginning of October. Mitchell grew up in Peru and graduated from La Salle High School-Peru. She holds a bachelor’s degree in accounting from Bradley University and is a certified public accountant. Mitchell began his career in the Chicagoland […]]]>

Tracy Mitchell, of Peruwas hired as the new financial director of the city of Peru at the beginning of October.

Mitchell grew up in Peru and graduated from La Salle High School-Peru. She holds a bachelor’s degree in accounting from Bradley University and is a certified public accountant.

Mitchell began his career in the Chicagoland area before returning to Peru. She worked as an accountant with the city for the past seven years before being hired as the city’s director of finance.

“I can honestly say that I was initially very impressed with the city of Peru,” Mitchell said. “As a former auditor, their accounting policies and procedures were in excellent shape. I plan to apply the basics of my knowledge of financial practices within the city and maintain the high level of accuracy and compliance that currently exists. »

Mitchell began his career as an internal auditor at Ernst&Young in Chicago. She then worked as a regional accounting manager for McDonald’s Corporation in Oak Brook for company-owned restaurants. After that, Mitchell was then recruited by AmeriKing dba National Restaurant Enterprises, Burger King’s largest franchisee at the time, to be the accounting manager.

Mitchell then left the Chicagoland area and returned to Peru to raise three children, two of whom graduated from La Salle High School-Peru and the third from St. Bede Academy.

Mitchell said she returned to the workforce almost seven years ago as an accountant in Peru.

“I will contribute and provide financial input to ensure that we adhere to proper fiscal policy,” Mitchell said. “I will maintain a fiduciary responsibility to protect the city’s assets and plan accordingly to meet the financial needs for effective operations.”

]]>
BLUCORA, INC. Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q) https://berningcpa.com/blucora-inc-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-form-10-q/ Tue, 01 Nov 2022 11:26:07 +0000 https://berningcpa.com/blucora-inc-managements-discussion-and-analysis-of-financial-condition-and-results-of-operations-form-10-q/ The following discussion provides an analysis of the Company's financial condition, cash flows, and results of operations from management's perspective and should be read in conjunction with our condensed consolidated financial statements and accompanying notes thereto included under Part I, Item 1 and the section titled "Cautionary Statement Regarding Forward-Looking Statements" in this Form 10-Q, […]]]>
The following discussion provides an analysis of the Company's financial
condition, cash flows, and results of operations from management's perspective
and should be read in conjunction with our condensed consolidated financial
statements and accompanying notes thereto included under Part I, Item 1 and the
section titled "Cautionary Statement Regarding Forward-Looking Statements" in
this Form 10-Q, as well as with our consolidated financial statements,
accompanying notes thereto, and "Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations" included in our Annual Report on
Form 10-K for the year ended December 31, 2021.

Insight


Blucora, Inc. (the "Company," "Blucora," "we," "our," or "us") is a leading
provider of integrated tax-focused wealth management services and software,
assisting consumers, small business owners, tax professionals, financial
professionals, and certified public accounting ("CPA") firms. Our mission is to
enable financial success by changing the way individuals and families plan and
achieve their goals through tax-advantaged solutions. We conduct our operations
through two primary businesses: (1) the Wealth Management business and (2) the
Tax Software business. Our common stock is listed on the NASDAQ Global Select
Market under the symbol "BCOR."

Wealth management

Our wealth management business includes the activities of Avantax Wealth Management and Avantax Planning Partners (collectively, the “Wealth Management Business” or the “Wealth Management Segment”).


Avantax Wealth Management provides tax-focused wealth management solutions for
financial professionals, tax professionals, CPA firms, and their clients.
Avantax Wealth Management offers its services through its registered
broker-dealer, registered investment advisor ("RIA"), and insurance agency
subsidiaries and is a leading U.S. tax-focused independent broker-dealer.
Avantax Wealth Management works with a nationwide network of financial
professionals that operate as independent contractors. Avantax Wealth Management
provides these financial professionals with an integrated platform of technical,
practice, compliance, operations, sales, and product support tools that enable
them to offer tax-advantaged planning, investing, and wealth management services
to their clients.

Avantax Planning Partners is an in-house/employee-based RIA, insurance agency,
and wealth management business that partners with CPA firms in order to provide
their consumer and small business clients with holistic financial planning and
advisory services, as well as retirement plan solutions through Avantax
Retirement Plan Services. Avantax Planning Partners formerly operated as Honkamp
Krueger Financial Services, Inc. ("HKFS"). We acquired HKFS in July 2020 (the
"HKFS Acquisition") and subsequently rebranded it in order to create tighter
brand alignment through one common and recognizable brand. Any reference to
Avantax Planning Partners in this Form 10-Q is inclusive of HKFS.

Tax software


Our Tax Software business consists of the operations of TaxAct, Inc. ("TaxAct,"
the "Tax Software business," or the "Tax Software segment") and provides digital
tax preparation services and ancillary services for consumers, small business
owners, and tax professionals through its website www.TaxAct.com and its mobile
applications.

Macroeconomic Environment

Our Wealth Management business is directly and indirectly affected by
macroeconomic conditions and the state of global financial markets. Recent
geopolitical uncertainty resulting, in part, from Russia's continued invasion of
Ukraine and the measures taken in response, including government sanctions, as
well as rising inflation have contributed to significant volatility and decline
in global financial markets during 2022 to date. In response to inflationary
pressures, the Federal Reserve implemented five interest rate increases during
the nine months ended September 30, 2022, including 75 basis point increases in
each of the June, July, and September 2022 Federal Open Market Committee
("FOMC") meetings. As of September 30, 2022, the target range for the federal
funds rate was between 3.0% and 3.25%, however the FOMC has signaled that it
expects additional rate increases in 2022 and 2023 in order to return inflation
to their 2% objective. These combined factors have all led to an increased risk
of economic recession and the potential for continued volatility and decline in
global financial markets.

Volatility and decline in global financial markets and their impact on the value of client assets and transactional activity negatively impacted Wealth Management revenues in the three and nine months ended September 30,

                      Blucora, Inc. | Q3 2022 Form 10-Q 19
--------------------------------------------------------------------------------

2022. This negative impact was offset, in part, by incremental cash sweep
revenue generated from an increasing interest rate environment. We expect that
cash sweep revenue will continue to increase in the fourth quarter of 2022 as
the full benefits of recent rate increases are fully realized. Based on the
target range for the federal funds rate, the signaling by the Federal Reserve
for additional rate increases during 2022, and current client asset values, we
expect incremental cash sweep revenue should more than offset the negative
impact that financial market volatility may have on Wealth Management revenues
and operating income for the year ended December 31, 2022. However, if further
financial market volatility results in continued decline in client asset values
or if the Federal Reserve does not increase, or decreases, the federal funds
rate, Wealth Management revenues and operating income would be negatively
impacted.

Sale of tax software business


On October 31, 2022, we entered into that certain Stock Purchase Agreement (the
"Stock Purchase Agreement") by and among the Company, TaxAct Holdings, Inc.,
Franklin Cedar Bidco, LLC ("Buyer") and DS Admiral Bidco, LLC, pursuant to which
we agreed to sell the Tax Software business to Buyer, an affiliate of Cinven,
for $720.0 million in cash (subject to adjustment as set forth in the Stock
Purchase Agreement), on the terms and subject to the conditions set forth in the
Stock Purchase Agreement (such sale, the "TaxAct Sale Transaction"). The TaxAct
Sale Transaction is subject to the expiration or termination of the waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and other
customary closing conditions and is expected to close by the end of 2022.

Following the consummation of the TaxAct Sale Transaction, we plan to change our
name from Blucora to Avantax and focus solely on our tax-focused wealth
business. The TaxAct Sale Transaction is expected to yield after-tax net cash
proceeds of approximately $620.0 million. We expect to use the net proceeds to
pay down existing indebtedness and return excess capital to stockholders.

                      Blucora, Inc. | Q3 2022 Form 10-Q 20
--------------------------------------------------------------------------------

                             RESULTS OF OPERATIONS

Summary
                                Three Months Ended September 30,                                                Nine Months Ended
($ in thousands)                                                                 Change                           September 30,                          Change
                                    2022                2021                $                %               2022               2021               $                %
Revenue:
Wealth Management               $  165,032          $ 169,135          $ (4,103)           (2.4) %       $ 494,104          $ 486,021          $ 8,083              1.7  %
Tax Software                         6,664              5,039             1,625            32.2  %         242,028            220,848           21,180              9.6  %
Total revenue                      171,696            174,174            (2,478)           (1.4) %         736,132            706,869           29,263              4.1  %
Operating income (loss):
Wealth Management                   27,626             19,564             8,062            41.2  %          59,920             60,356             (436)            (0.7) %
Tax Software                       (12,517)           (13,864)            1,347             9.7  %          99,372            100,472           (1,100)            (1.1) %
Corporate-level activity           (28,927)           (25,982)           (2,945)          (11.3) %         (77,282)          (102,255)          24,973             24.4  %
Total operating income (loss)      (13,818)           (20,282)            6,464            31.9  %          82,010             58,573           23,437             40.0  %
Interest expense and other, net     (9,749)            (8,295)           (1,454)          (17.5) %         (25,707)           (24,202)          (1,505)            (6.2) %
Income (loss) before income
taxes                              (23,567)           (28,577)            5,010            17.5  %          56,303             34,371           21,932             63.8  %
Income tax benefit (expense)         1,726                774               952           123.0  %          (4,099)            (2,920)          (1,179)           (40.4) %
Net income (loss)               $  (21,841)         $ (27,803)         $  5,962            21.4  %       $  52,204          $  31,451           20,753             66.0  %

For the three months ended September 30, 2022compared to the three months ended September 30, 2021net loss decreased $6.0 million mainly due to the following factors:

• Increase in Wealth Management operating profit $8.1 million primarily due to the significant increase in cash sweep revenues during the period.

• The operating loss of the tax software sector decreased $1.3 million mainly due to rising consumer incomes and relatively stable operating expenses.


•Expenses within corporate-level activity increased $2.9 million primarily due
to incremental depreciation expense and consulting costs. Furthermore, interest
expense and other, net, increased $1.5 million, primarily due to rising interest
rates.

•The Company recorded an income tax benefit of $1.7 million, or an effective tax
rate of 7.3%, for the three months ended September 30, 2022, compared to an
income tax benefit of $0.8 million, or an effective tax rate of 2.7%, for the
three months ended September 30, 2021.

For the nine months ended September 30, 2022compared to the nine months ended
September 30, 2021net income increased $20.8 million mainly due to the following factors:

•Wealth Management operating income remained relatively flat as additional cash transfer revenue offset headwinds caused by market volatility and additional personnel costs.

• Income from operations in the Tax Software segment decreased $1.1 million primarily due to increased customer support costs and strategic advertising and marketing expenses.


•Expenses within corporate-level activity decreased $25.0 million primarily due
to reduced acquisition and integration costs. Furthermore, interest expense and
other, net, increased $1.5 million, primarily due to rising interest rates.

•The Company recorded income tax expense of $4.1 million, or an effective tax
rate of 7.3%, for the nine months ended September 30, 2022, compared to income
tax expense of $2.9 million, or an effective tax rate of 8.5%, for the nine
months ended September 30, 2021.

                      Blucora, Inc. | Q3 2022 Form 10-Q 21
--------------------------------------------------------------------------------

                       SEGMENT REVENUE & OPERATING INCOME

The revenue and operating income amounts in this section are presented on a
basis consistent with accounting principles generally accepted in the United
States ("GAAP") and include certain reconciling items attributable to our
segments. We have two reportable segments: (1) the Wealth Management segment and
(2) the Tax Software segment. Segment information is presented on a basis
consistent with our current internal management financial reporting. We do not
allocate certain general and administrative costs (including personnel and
overhead costs), stock-based compensation, acquisition and integration costs,
depreciation, amortization of acquired intangible assets, or contested proxy,
transaction and other legal and consulting costs to the reportable segments.
Such amounts are reflected under the heading "Corporate-level activity." In
addition, we do not allocate interest expense and other, net, or income taxes to
the reportable segments.

Wealth Management
                                Three Months Ended September 30,                                                   Nine Months Ended
($ in thousands)                                                                    Change                           September 30,                          Change
                                    2022                   2021                $                %               2022               2021               $                %
Revenue                      $       165,032           $ 169,135          $ (4,103)           (2.4) %       $ 494,104          $ 486,021          $ 8,083             1.7  %
Operating income             $        27,626           $  19,564          $  8,062            41.2  %       $  59,920          $  60,356          $  (436)           (0.7) %
Segment margin                          16.7   %            11.6  %                                              12.1  %            12.4  %

For the three months ended September 30, 2022compared to the three months ended September 30, 2021Wealth Management operating income increased
$8.1 million mainly due to the following factors:


•Wealth Management revenue decreased $4.1 million primarily due to decreases of
$11.2 million and $8.5 million in commission and advisory revenues,
respectively. These revenue headwinds were primarily caused by the significant
financial market volatility and decline discussed in the Macroeconomic
Environment section above. These decreases were partially offset by a $15.5
million increase in asset-based revenue which benefited from incremental cash
sweep revenue generated from increases in the federal funds rate.

•Wealth Management operating expenses decreased $12.2 million primarily due to a
$15.1 million decline in cost of revenue associated with advisory fees and
commissions paid, partially offset by $2.2 million of incremental personnel
costs. Advisory fees and commissions paid trended consistently with the decrease
in commission and advisory revenues discussed above. Increased personnel costs
reflect our strategic investments to drive growth through enhanced sales and
service capabilities that support our financial professionals.

•The significant increase in cash sweep revenue during the period was the
primary driver of the 510 basis point increase in segment margin. We expect for
segment margin to continue to benefit from incremental cash sweep revenue for
the remainder of the year.

For the nine months ended September 30, 2022, compared to the nine months ended
September 30, 2021, Wealth Management segment operating income decreased $0.4
million primarily due to the following factors:

•Wealth Management revenue increased $8.1 million primarily due to increases of
$17.3 million and $15.2 million in asset-based and advisory revenues,
respectively. Asset-based revenue benefited from incremental cash sweep revenue
generated from increases in the federal funds rate, while the increase in
advisory revenue was primarily from increased client asset levels and the timing
of market movements relative to when clients are billed. These increases were
partially offset by a $24.9 million decrease in commission revenue which was
negatively impacted by unfavorable transaction activity and volatility in global
financial markets, as discussed above.

•Wealth Management operating expenses increased $8.5 million primarily due to
$11.1 million of incremental personnel costs, partially offset by a $4.3 million
decrease in cost of revenue associated with advisory fees and commissions paid.
Increased personnel costs reflect our strategic investments to drive growth
through enhanced sales and service capabilities that support our financial
professionals. Advisory fees and commissions paid trended consistently with the
associated changes in revenues discussed above, while payout ratios remained
relatively flat between the two periods as the financial market volatility
during the first three quarters of 2022 offset previous expansion in the number
of financial professionals concentrated at higher payout levels.

                      Blucora, Inc. | Q3 2022 Form 10-Q 22
--------------------------------------------------------------------------------

•The market volatility discussed above, coupled with an increase in our fixed
operating costs, has caused margin compression for the nine months ended
September 30, 2022. However, the significant increase in cash sweep revenue
during the three months ended September 30, 2022 predominately offset this
compression, resulting in a relatively flat segment margin. For the remainder of
the year, we expect for incremental cash sweep revenue to more than offset the
compression discussed above, and for segment margin to increase on a
year-over-year basis.

Sources of income


Wealth Management revenue is derived from multiple sources. We track sources of
revenue, primary drivers of each revenue source, and recurring revenue. In
addition, we focus on several business and key financial metrics in evaluating
the success of our business relationships, our resulting financial position, and
operating performance. A summary of our sources of revenue and business and
financial metrics is as follows:

                                                                                         Three Months Ended September 30,                           Nine Months Ended
($ in thousands)                                                                                                                     Change           September 30,              Change
                                     Sources of Revenue          Primary Drivers             2022                   2021                $                      2022               2021                $
                                  Advisory                  - Advisory asset levels   $        95,070           $ 103,540          $ (8,470)               $ 306,394          $ 291,167          $ 15,227
  Financial professional-driven                             - Transactions
                                  Commission                - Asset levels
                                                            - Product mix                      41,788              52,961           (11,173)                 132,278            157,197           (24,919)
                                                            - Cash balances
                                  Asset-based               - Interest rates
                                                            - Number of accounts
                                                            - Client asset levels              21,147               5,659            15,488                   33,774             16,514            17,260
          Other revenue                                     - Account activity
                                                            - Number of financial
                                  Transaction and fee        professionals
                                                            - Number of clients
                                                            - Number of accounts                7,027               6,975                52                   21,658             21,143               515
                                  Total revenue                                       $       165,032           $ 169,135          $ (4,103)               $ 494,104          $ 486,021          $  8,083
                                  Total recurring revenue                             $       144,512           $ 145,311          $   (799)               $ 430,184          $ 414,966          $ 15,218
                                  Recurring revenue rate                                         87.6   %            85.9  %                                    87.1  %            85.4  %


Recurring revenue consists of advisory fees, trailing commissions, fees from
cash sweep programs, and certain transaction and fee revenue, all as described
further under the headings "Advisory revenue," "Commission revenue,"
"Asset-based revenue," and "Transaction and fee revenue," respectively. Certain
recurring revenues are associated with asset balances and fluctuate depending on
market values and current interest rates. Accordingly, our recurring revenue can
be negatively impacted by adverse external market conditions. However, we
believe recurring revenue is meaningful because it is not dependent upon
transaction volumes or other activity-based revenues, which are more difficult
to predict, particularly in declining or volatile markets.

                      Blucora, Inc. | Q3 2022 Form 10-Q 23
--------------------------------------------------------------------------------
Business Metrics
($ in thousands)                                             September 30,                                  Change
                                                      2022                  2021                    $                     %
Client assets balances:
Total client assets (1)                          $ 72,592,882          $ 86,647,743          $ (14,054,861)              (16.2) %
Brokerage assets (1)                             $ 37,150,327          $ 46,850,354          $  (9,700,027)              (20.7) %
Advisory assets (1)                              $ 35,442,555          $ 39,797,389          $  (4,354,834)              (10.9) %
Advisory assets as a percentage of total client
assets                                                   48.8  %            

45.9%


Number of financial professionals (in ones):
Independent financial professionals (2)                 3,311                 3,498                   (187)               (5.3) %
In-house/employee financial professionals (3)              36                    31                      5                16.1  %
Total number of financial professionals                 3,347                 3,529                   (182)               (5.2) %

Advisory and commission revenue per financial
professional (4)                                 $       40.9          $       44.3          $        (3.4)               (7.7) %


___________________________

(1)In connection with our ongoing integration of acquisitions, we refined the
methodology by which we calculate client assets to align the methodologies
within our Wealth Management segment for calculating such metrics. Specifically,
such changes to the methodology include alignment to one third party data
aggregator for assets not placed in custody with our clearing firm and to one
consistent set of logic for all assets and transaction types. We have not recast
client assets for prior periods to conform to our current presentation as we
believe the changes to the calculation to be immaterial.
(2)The number of independent financial professionals includes licensed financial
professionals that work with Avantax Wealth Management and operate as
independent contractors, as well as licensed referring representatives at CPA
firms (approximately 171) that partner with Avantax Planning Partners.
(3)The number of in-house/employee financial professionals includes licensed
financial planning consultants, all of which are affiliated with Avantax
Planning Partners.
(4)Calculation based on advisory and commission revenue for the three months
ended September 30, 2022 and 2021, respectively.

Client Assets. Historically we have calculated total client assets to include
assets that we hold directly or indirectly on behalf of clients under a
safekeeping or custody arrangement or for which we provide administrative
services for clients. Beginning in the second quarter of 2022, the calculation
of total client assets also includes assets for which financial professionals
licensed with Avantax provide administrative services to clients. Because we did
not have relationships with financial professionals that had clients for whom we
did not provide administrative services prior to the second quarter of 2022, our
calculation of total client assets for any prior period would not have changed
under our current calculation. To the extent that we or they provide more than
one service for a client's assets, the value of the asset is only counted once
in the total amount of total client assets. Total client assets include advisory
assets, non-advisory brokerage accounts, annuities, and mutual fund positions
held directly with fund companies. These assets are not reported on the
Company's condensed consolidated balance sheets.

Advisory assets include client assets for which we provide investment advisory
and management services as a fiduciary under the Investment Advisers Act of
1940. Our compensation for providing such services is typically a fee-based on
the value of the advisory assets for each advisory client. These assets are not
reported on the Company's condensed consolidated balance sheets.

Brokerage assets represent total client assets other than advisory assets.

Total client assets decreased $14.1 billion of the September 30, 2022 compared to
September 30, 2021mainly due to $14.3 billion unfavorable market trends, partially offset by net customer inflows.


Advisory assets decreased $4.4 billion as of September 30, 2022 compared to
September 30, 2021, and advisory assets as a percentage of total client assets
increased to 48.8% as of September 30, 2022, compared to 45.9% as of
September 30, 2021. The decrease in advisory assets was primarily caused by
$7.4 billion of unfavorable market changes, partially offset by net new advisory
assets of $3.0 billion which contributed to the increase in advisory assets as a
percentage of total client assets.

Financial Professionals. The number of our financial professionals decreased
5.2% as of September 30, 2022 compared to September 30, 2021, with the decrease
primarily due to attrition related to lower revenue-producing financial
professionals. Advisory and commission revenue per financial professional
decreased 7.7% for the same period, primarily due to the decreases in advisory
and commission revenues discussed above. The

                      Blucora, Inc. | Q3 2022 Form 10-Q 24
--------------------------------------------------------------------------------

The decline in the number of finance professionals was partially offset by our continued recruitment and onboarding of independent finance professionals.


Advisory Revenue. Advisory revenue primarily includes fees charged to clients in
advisory accounts for which we are the RIA. These fees are based on the value of
assets within these advisory accounts. For advisory revenues generated by
Avantax Wealth Management, advisory fees are typically billed quarterly, in
advance, and the related advisory revenues are deferred and recognized ratably
over the period in which our performance obligations have been completed. For
advisory revenue generated by Avantax Planning Partners, advisory fees are
typically billed quarterly, in arrears, and the related advisory revenues are
accrued and recognized ratably over the period in which our performance
obligations were completed. Because advisory fees are based on advisory assets
on the last day of each quarter, our revenues are impacted, in part, by the
timing of market movements relative to when clients are billed.

Advisory asset balances were as follows (in thousands):

                                                                  September 30,                                 Change
                                                           2022                  2021                    $                    %

Asset Advisory – Independent Finance Professionals $29,735,365 $33,713,543 $(3,978,178)

              (11.8) %
Advisory assets-in-house/employee financial
professionals                                            4,494,178             4,701,444              (207,266)               (4.4) %
Retirement advisory assets-in-house/employee
financial professionals                                  1,213,012             1,382,402              (169,390)              (12.3) %
Total advisory assets                                 $ 35,442,555          $ 39,797,389          $ (4,354,834)              (10.9) %


Activity within our advisory assets was as follows (in thousands):

                                                     Three Months Ended September 30,                 Nine Months Ended September 30,
                                                        2022                    2021                     2022                    2021
Balance, beginning of the period                $      36,746,048          $ 39,440,985          $      42,179,051          $ 35,603,557
Net new advisory assets                                   514,293               621,205                  2,261,923             1,853,632

Market impact and other                                (1,817,786)             (264,801)                (8,998,419)            2,340,200
Balance, end of the period                      $      35,442,555          $ 39,797,389          $      35,442,555          $ 39,797,389
Advisory revenue                                $          95,070         

$103,540 $306,394 $291,167
Average advisory fee rate (1)

                                 26 bps                26 bps                     77 bps                78 bps


_________________________

(1)For the three months ended September 30, 2022 and September 30, 2021, average
advisory fee rate equals advisory revenue for the relevant quarterly period
divided by the advisory asset balance at the beginning of the relevant quarterly
period. For the nine months ended September 30, 2022 and September 30, 2021,
average advisory fee rate equals the sum of each quarterly average advisory fee
rate within the relevant year-to-date period.

For the three and nine months ended September 30, 2022, advisory assets declined
$1.3 billion and $6.7 billion, respectively, primarily due to unfavorable market
changes, partially offset by net new advisory assets. Net new advisory assets
benefited from organic growth and the conversion of off platform, direct to fund
assets, when appropriate for the client, to fee-based advisory platforms that
include ongoing management and which generate higher margins.

For the three months ended September 30, 2022, compared to the three months
ended September 30, 2021, advisory revenues decreased $8.5 million, primarily
due to the decline in global markets as discussed above. Although advisory
assets declined during the nine months ended September 30, 2022, due to the
timing of market declines relative to when clients are billed, advisory revenue
increased $15.2 million. The average advisory fee rates between the two periods
were relatively flat.

Commission Revenue. The Wealth Management segment generates two types of
commissions: (1) transaction-based commissions and (2) trailing commissions.
Transaction-based commissions, which occur when clients trade securities or
purchase investment products, represent gross commissions generated by our
financial professionals. The level of transaction-based commissions can vary
from period-to-period based on the overall economic environment, number of
trading days in the reporting period, market volatility, interest rate
fluctuations, and investment activity of our financial professionals' clients.
We earn trailing commissions (a commission or fee that is paid periodically over
time) on certain mutual funds and variable annuities held by clients. Trailing
commissions are recurring in nature and are based on the market value of
investment holdings in trail-eligible assets.

                      Blucora, Inc. | Q3 2022 Form 10-Q 25
--------------------------------------------------------------------------------

Our commission income, by product category and by type of commission income, was as follows (in thousands):

                                    Three Months Ended September                                                   Nine Months Ended
                                                30,                                Change                            September 30,                           Change
                                       2022              2021                $                 %                2022               2021                $                 %
By product category:
Mutual funds                       $  16,339          $ 22,844          $  (6,505)           (28.5) %       $  53,635          $  70,395          $ (16,760)           (23.8) %
Variable annuities                    14,892            18,752             (3,860)           (20.6) %          46,961             55,247             (8,286)           (15.0) %
Insurance                              5,048             4,414                634             14.4  %          13,007             14,044             (1,037)            (7.4) %
General securities                     5,509             6,951             (1,442)           (20.7) %          18,675             17,511              1,164              6.6  %

Total commission revenue           $  41,788          $ 52,961          $ (11,173)           (21.1) %       $ 132,278          $ 157,197          $ (24,919)           (15.9) %

By type of commission:
Transaction-based                  $  17,868          $ 22,372          $  (4,504)           (20.1) %       $  56,373          $  65,815          $  (9,442)           (14.3) %
Trailing                              23,920            30,589             (6,669)           (21.8) %          75,905             91,382            (15,477)           (16.9) %
Total commission revenue           $  41,788          $ 52,961          $ (11,173)           (21.1) %       $ 132,278          $ 157,197          $ (24,919)           (15.9) %


As discussed in the sections above, the decline in transaction-based commission and trailing commission revenue for the periods shown in the above table was primarily due to unfavorable trading activity and financial market volatility. worldwide in the three and nine months ended September 30, 2022.

Asset-based income. Asset-based income primarily includes financial product manufacturer referral program fees, cash sweep programs, asset-based pension plan service fees and other asset-based income.


For the three and nine months ended September 30, 2022, compared to the three
and nine months ended September 30, 2021, asset-based revenue increased $15.5
million and $17.3 million, respectively. These increases were primarily due to
incremental cash sweep revenue of $16.9 million and $19.2 million during the
three and nine months ended September 30, 2022, respectively, driven by
increases in the federal funds rate. The increases in cash sweep revenue were
partially offset by reduced fees from sponsorship programs. Due to the timing of
rate increases and the non-linear nature of upside associated with these
increases, and with expectation of additional rate increases by the Federal
Reserve in 2022, cash sweep revenue is expected to continue to increase for the
remainder of the year.

Revenue from transactions and fees. Transaction and fee income primarily includes support fees charged to finance professionals, fees charged for executing certain transactions in client accounts and other fees related to services provided and other account fees, as generally set forth in agreements with finance professionals, clients, financial institutions and retirement. plan sponsors.


For the three and nine months ended September 30, 2022, compared to the three
and nine months ended September 30, 2021, transaction and fee revenue remained
relatively flat.

                      Blucora, Inc. | Q3 2022 Form 10-Q 26
--------------------------------------------------------------------------------
Tax Software
                                                                                                                      Nine Months Ended
($ in thousands)                    Three Months Ended September 30,                    Change                          September 30,                          Change
                                        2022                   2021               $                %               2022               2021                $                %
Revenue                          $         6,664           $   5,039          $ 1,625            32.2  %       $ 242,028          $ 220,848          $ 21,180             9.6  %
Operating income (loss)          $       (12,517)          $ (13,864)         $ 1,347             9.7  %       $  99,372          $ 100,472          $ (1,100)           (1.1) %
Segment margin                            (187.8)  %          (275.1) %                                             41.1  %            45.5  %


For the three months ended September 30, 2022, compared to the three months
ended September 30, 2021, Tax Software operating loss decreased $1.3 million due
to a $1.5 million increase in consumer revenue and relatively flat operating
expenses. Consumer revenue benefited from an increase in consumer e-files
associated with market share growth and the volume of customers that filed
extensions when compared to the prior year.

For the nine months ended September 30, 2022, compared to the nine months ended
September 30, 2021, Tax Software operating income decreased $1.1 million due to
the following factors:

•Tax Software revenue increased $21.2 million due to a $18.4 million increase in
consumer revenue and a $2.8 million increase in professional revenue. The growth
in revenue during the nine months ended September 30, 2022 was attributable to
higher average revenue per unit and growth in market share from favorable
customer retention and acquisition. These increases during the period were
partially offset by an increase in the volume of customers that filed extensions
when compared to the prior year. We expect to continue to benefit from higher
average revenue per unit for the remainder of the year as customers complete
returns associated with these extensions.

•Tax Software operating expenses increased $22.3 million primarily due to
increased investments in seasonal customer care support and tax experts and an
increase in strategic advertising and marketing spend. These incremental costs
were the primary drivers of the reduction in segment margin shown in the table
above.

Sources of Revenue

Tax Software revenue is derived primarily from the sale of digital tax
preparation services, ancillary services, packaged tax preparation software, and
multiple element arrangements that may include a combination of these items.
Ancillary services primarily include refund payment transfer, audit defense,
e-file concierge services, and Xpert Assist.

We classify Tax Software revenue into two different categories: consumer revenue
and professional revenue. Consumer revenue is derived from products and services
sold directly to customers primarily for the preparation of individual or
business tax returns. Professional revenue represents Tax Software revenue
derived from products sold to tax return preparers who utilize our offerings to
service end-user customers.

Revenue by category was as follows (in thousands):

                              Three Months Ended September                                                Nine Months Ended
                                           30,                              Change                          September 30,                          Change
                                  2022              2021              $                %               2022               2021                $                %
Consumer                      $   5,974          $ 4,479          $ 1,495            33.4  %       $ 222,262          $ 203,891          $ 18,371             9.0  %
Professional                        690              560              130            23.2  %          19,766             16,957             2,809            16.6  %
Total Tax Software revenue    $   6,664          $ 5,039          $ 1,625            32.2  %       $ 242,028          $ 220,848          $ 21,180             9.6  %


Business Metrics

We measure the performance of our Tax Software business using three sets of
non-financial metrics, which we consider to be important indicators of the
performance of our Tax Software business and are especially relevant through the
end of a completed tax season. These non-financial metrics include key
performance indicators for our total Tax Software business, in addition to the
consumer and professional tax software portions of the Tax Software business:

•We measure our total tax software customers using the total number of accepted
federal tax e-files completed by both our consumer tax software customers and
our professional tax software customers.

•We measure our commodity tax software customers using the number of accepted federal tax electronic files made through our digital software and services.

                      Blucora, Inc. | Q3 2022 Form 10-Q 27
--------------------------------------------------------------------------------

•We measure our professional tax software customers using three metrics: (1) the
number of accepted federal tax e-files made through our software, (2) the number
of units sold, and (3) the number of e-files per unit sold.

                                                           Nine Months 

Ended

(In thousands, except as otherwise indicated)                September 30,                                    Change
                                                     2022                      2021                  Units                 %
Total e-files (1)                                     5,658                     5,492                    166                3.0  %
Consumer:
Consumer e-files (1)                                  3,232                     3,144                     88                2.8  %
Professional:
Professional e-files                                  2,426                     2,348                     78                3.3  %
Units sold (in ones)                                 21,051                    20,808                    243                1.2  %
Professional e-files per unit sold (in ones)          115.2                     112.8                    2.4                2.1  %


____________________________

(1)We participate in the Free File Alliance that is part of an IRS partnership
that provides free electronic tax filing services to taxpayers meeting certain
income-based guidelines. Free File Alliance e-files are included within total
e-files and consumer e-files above.

For the nine months ended September 30, 2022, compared to the nine months ended
September 30, 2021, e-files across each category, and professional units sold,
increased primarily due to growth in market share from favorable customer
retention and acquisition, both of which benefited from our investments in
strategic marketing spend and customer care support.

Enterprise level activity

Certain enterprise-level activities, including certain general and administrative expenses (such as personnel and general expenses), stock-based compensation, acquisition and integration costs, depreciation, amortization of acquired intangibles and contested proxies, transaction costs and other legal and advisory fees, are not allocated to our reportable segments.

Company-level activity by category was as follows (in thousands):

                                  Three Months Ended September                                               Nine Months Ended
                                              30,                               Change                         September 30,                           Change
                                     2022              2021               $                %              2022               2021                $                 %
Unallocated corporate-level
general and administrative
expenses                         $   7,456          $  6,499          $   957            14.7  %       $ 22,428          $  18,452          $   3,976             21.5  %
Stock-based compensation             5,706             4,729              977            20.7  %         17,129             15,499              1,630             10.5  %
Acquisition and integration            416             2,241           (1,825)          (81.4) %         (4,710)            28,513            (33,223)          (116.5) %
Depreciation                         6,020             3,906            2,114            54.1  %         15,696             11,251              4,445             39.5  %
Amortization of acquired
intangible assets                    6,342             7,009             (667)           (9.5) %         19,435             21,247             (1,812)            (8.5) %
Contested proxy, transaction and
other legal and consulting costs     2,987             1,598            1,389            86.9  %          7,304              7,293                 11              0.2  %

Total activity at company level $28,927 $25,982 $2,945

            11.3  %       $ 77,282          $ 102,255          $ (24,973)           (24.4) %


For the three months ended September 30, 2022compared to the three months ended September 30, 2021business level activity increased $2.9 million
mainly due to the following factors:

• Depreciation expense increased $2.1 million primarily due to capitalized software costs for our Tax software Company.


•Contested proxy, transaction and other legal and consulting costs increased
$1.4 million primarily due to incremental legal and consulting costs incurred in
connection with the TaxAct Sale Transaction.

Partially offsetting this increased activity at the enterprise level:


•Acquisition and integration expenses decreased $1.8 million, primarily due to
the final remeasurement of the HKFS Contingent Consideration liability in the
second quarter of 2022.

                      Blucora, Inc. | Q3 2022 Form 10-Q 28
--------------------------------------------------------------------------------

For the nine months ended September 30, 2022, compared to the nine months ended
September 30, 2021, corporate-level activity decreased $25.0 million primarily
due to the following factors:

•Acquisition and integration expenses decreased $33.2 million, primarily due to
a $24.8 million decrease in the fair value adjustments recorded for the HKFS
Contingent Consideration liability between the two periods, and an $8.4 million
decrease in professional services and other expenses due to a reduction in
integration activities.

Partially offsetting this drop in activity at the enterprise level:

• Depreciation expense increased $4.4 million primarily due to capitalized software costs for our Tax software Company.

• Increase in unallocated general and administrative expenses $4.0 million
mainly due to additional personnel and insurance costs.

                               OPERATING EXPENSES

Cost of Revenue
                                  Three Months Ended September 30,                                                     Nine Months Ended
($ in thousands)                                                                       Change                            September 30,                           Change
                                      2022                   2021                $                 %                2022               2021                $                %
Wealth Management              $       105,301           $ 120,641          $ (15,340)           (12.7) %       $ 338,819          $ 343,174          $ (4,355)            (1.3) %
Tax Software                             3,879               2,323              1,556             67.0  %          20,178             12,330             7,848             63.6  %

Total cost of revenue          $       109,180           $ 122,964          $ (13,784)           (11.2) %       $ 358,997          $ 355,504          $  3,493              1.0  %
Percentage of revenue                     63.6   %            70.6  %                                                48.8  %            50.3  %


Cost of revenue consists of costs related to our Wealth Management and Tax
Software businesses, which include commissions and advisory fees paid to
independent financial professionals, payments made to CPA firms under fee
sharing arrangements, amortization of forgivable loans issued to our financial
professionals, third-party costs, and costs associated with the technical
support team and the operation of our data centers. Data center costs include
personnel expenses, the cost of temporary help and contractors, professional
services fees, software support and maintenance, bandwidth and hosting costs,
and depreciation (including depreciation related to software development costs
in the Tax Software segment). Cost of revenue does not include compensation paid
to in-house/employee financial professionals in our Wealth Management business.
The compensation of our in-house/employee financial professionals is reflected
in "Sales and marketing" expense.

For the three months ended September 30, 2022, compared to the three months
ended September 30, 2021, cost of revenue decreased $13.8 million. The reduction
in Wealth Management cost of revenue was primarily due to reduced advisory fees
and commissions paid, which trended consistently with the associated changes in
revenue discussed within the Segment Revenue & Operating Income section above.
This decline was partially offset by increased depreciation of capitalized
software development costs within Tax Software.

For the nine months ended September 30, 2022, compared to the nine months ended
September 30, 2021, cost of revenue increased $3.5 million. Tax Software cost of
revenue included incremental personnel and consulting costs and depreciation of
capitalized software. Continued investments in internally developed software for
the Tax Software business are expected to result in increased depreciation in
future periods. Within Wealth Management, advisory fees and commissions paid
declined $6.4 million and trended consistently with the associated changes in
revenue discussed within the Segment Revenue & Operating Income section above.
This decline was partially offset by $2.4 million of incremental forgivable
loans amortization.

Payout ratios to independent financial professionals are determined based on
trailing twelve-month revenues and may not immediately correlate with changes in
client assets during periods of significant market volatility. For both periods,
payout ratios to independent financial professionals remained relatively flat as
the financial market volatility during the first three quarters of 2022 offset
previous expansion in the number of financial professionals concentrated at
higher payout levels.

                      Blucora, Inc. | Q3 2022 Form 10-Q 29
--------------------------------------------------------------------------------
Engineering and Technology
                                   Three Months Ended September                                              Nine Months Ended
($ in thousands)                                30,                             Change                         September 30,                         Change
                                       2022              2021              $               %              2022              2021               $                %
Engineering and technology         $  7,474           $ 7,874          $ (400)           (5.1) %       $ 24,598          $ 22,233          $ 2,365            10.6  %
Percentage of revenue                   4.4   %           4.5  %                                            3.3  %            3.1  %


Engineering and technology expenses are associated with the research,
development, support, and ongoing enhancements of our offerings, which include
personnel expenses, the cost of temporary help and contractors, software support
and maintenance, bandwidth and hosting, and professional services fees.
Engineering and technology expenses do not include the costs of computer
hardware and software that are capitalized, depreciated over their useful lives,
and recognized on the consolidated statements of operations as either "Cost of
Revenue" or "Depreciation." For more information, see the "Cost of Revenue" and
"Depreciation and Amortization of Acquired Intangible Assets" sections contained
within this discussion of "Operating Expenses."

For the three months ended September 30, 2022compared to the three months ended September 30, 2021engineering and technology spending remained relatively stable.


For the nine months ended September 30, 2022, compared to the nine months ended
September 30, 2021, engineering and technology expenses increased $2.4 million
primarily due to increases in personnel expenses in our Tax Software segment.

Sales and Marketing
                                Three Months Ended September                                                Nine Months Ended
($ in thousands)                             30,                              Change                          September 30,                          Change
                                   2022               2021               $               %               2022               2021                $                %
Sales and marketing            $  30,485           $ 28,399          $ 2,086            7.3  %       $ 162,396          $ 140,809          $ 21,587            15.3  %
Percentage of revenue               17.8   %           16.3  %                                            22.1  %            19.9  %


Sales and marketing expenses primarily consist of marketing expenses associated
with our Tax Software business (including expenses related to marketing agencies
and media companies) and our Wealth Management business, personnel expenses,
compensation paid to Avantax Planning Partners in-house/employee financial
professionals, the cost of temporary help and contractors, and back-office
processing support expenses for our Wealth Management business.

For the three months ended September 30, 2022compared to the three months ended September 30, 2021sales and marketing expenses increased $2.1 millionmainly due to the additional personnel costs of $1.6 million in our Wealth Management segment.

For the nine months ended September 30, 2022compared to the nine months ended
September 30, 2021sales and marketing expenses increased $21.6 millionmainly due to the following factors:

• Personnel costs in both segments increased $11.8 million.

• Strategic advertising and marketing costs in our Tax software augmented segment
$9.0 million.

For the remainder of the year, we expect to incur additional travel and conference costs associated with the reduction in travel restrictions and the timing of our National Wealth Management Conference.

General and Administrative
                                    Three Months Ended September                                                Nine Months Ended
($ in thousands)                                 30,                               Change                         September 30,                         Change
                                       2022               2021               $                %              2022              2021                $                %
General and administrative         $  27,778           $ 23,102          $ 4,676            20.2  %       $ 83,499          $ 71,619          $ 11,880            16.6  %
Percentage of revenue                   16.2   %           13.3  %                                            11.3  %           10.1  %

General and administrative (“G&A”) expenses primarily include personnel costs, the cost of temporary help and contractors, professional service fees, business development and management overhead, occupancy and office space, business taxes and insurance costs.

                      Blucora, Inc. | Q3 2022 Form 10-Q 30
--------------------------------------------------------------------------------

For the three and nine months ended September 30, 2022, compared to the three
and nine months ended September 30, 2021, G&A expenses increased $4.7 million
and $11.9 million, respectively, primarily due to incremental personnel costs,
professional services fees, and hardware and software support and maintenance
fees.

Acquisition and Integration
                                Three Months Ended September 30,                                                   Nine Months Ended
($ in thousands)                                                                    Change                           September 30,                           Change
                                      2022                 2021               $                 %               2022              2021                $                  %

Change in the fair value of
HKFS Contingent Consideration  $           -            $ 1,700          $ (1,700)           (100.0) %       $ (5,320)         $ 19,500          $ (24,820)           (127.3) %
Professional services and
other expenses                           416                541              (125)            (23.1) %            610             9,013             (8,403)            (93.2) %
Total                          $         416            $ 2,241          $ (1,825)            (81.4) %       $ (4,710)         $ 28,513          $ (33,223)           (116.5) %
Percentage of revenue                    0.2    %           1.3  %                                               (0.6) %            4.0  %


Acquisition and integration expenses primarily relate to costs incurred for the
acquisitions of Avantax Planning Partners and 1st Global and consist of
employee-related expenses, professional services fees, changes in the fair value
of contingent consideration, and other expenses.

For the three months ended September 30, 2022compared to the three months ended September 30, 2021acquisition and integration costs decreased $1.8 millionprimarily due to the final revaluation of HKFS contingent consideration liability in the second quarter of 2022.

For the nine months ended September 30, 2022compared to the nine months ended
September 30, 2021acquisition and integration costs decreased $33.2 millionmainly due to the following factors:


•The change in fair value of the HKFS Contingent Consideration liability
decreased $24.8 million, primarily due to the timing of fair value adjustments
recorded between the two periods. This change is inclusive of a $7.0 million
gain recorded during the second quarter of 2022 for the final settlement value
of the liability, reflecting a decrease in the fair value of the contingent
consideration due to a significant decline in advisory asset levels caused by
the financial market decline discussed in the sections above.

• Professional services and other expenses decreased $8.4 million due to a reduction in integration activities.

Depreciation and amortization of acquired intangible assets

                          Three Months Ended September                                              Nine Months Ended
($ in thousands)                      30,                              Change                         September 30,                         Change
                             2022               2021              $               %              2022              2021               $                %
Depreciation             $   3,839           $ 2,867          $  972            33.9  %       $  9,907          $  8,371          $ 1,536            18.3  %
Amortization of acquired
intangible assets            6,342             7,009            (667)           (9.5) %         19,435            21,247           (1,812)           (8.5) %
Total                    $  10,181           $ 9,876          $  305             3.1  %       $ 29,342          $ 29,618          $  (276)           (0.9) %
Percentage of revenue          5.9   %           5.7  %                                            4.0  %            4.2  %

Amortization of property, plant and equipment and software, net, includes the amortization of computer hardware and software (including internally developed software), office equipment and furniture, and leasehold improvements. The amortization of acquired intangible assets primarily includes the amortization of relationships with financial professionals, sponsors and clients, which are amortized over their estimated useful life.


For the three and nine months ended September 30, 2022, compared to the three
and nine months ended September 30, 2021, depreciation and amortization expense
did not materially change.

                      Blucora, Inc. | Q3 2022 Form 10-Q 31
--------------------------------------------------------------------------------
                        INTEREST EXPENSE AND OTHER, NET

                         Three Months Ended September                                               Nine Months Ended
($ in thousands)                      30,                              Change                         September 30,                         Change
                             2022              2021              $                %               2022              2021               $               %
Interest expense         $   8,771          $ 7,304          $ 1,467            20.1  %       $  23,166          $ 21,789          $ 1,377            6.3  %
Amortization of debt
issuance costs                 403              388               15             3.9  %           1,191             1,128               63            5.6  %
Amortization of debt
discount                       302              290               12             4.1  %             893               851               42            4.9  %
Total interest expense       9,476            7,982            1,494            18.7  %          25,250            23,768            1,482            6.2  %
Interest income and
other                          273              313              (40)          (12.8) %             457               434               23            5.3  %

Interest expense and
other, net               $   9,749          $ 8,295          $ 1,454            17.5  %       $  25,707          $ 24,202          $ 1,505            6.2  %


For the three and nine months ended September 30, 2022, compared to the three
and nine months ended September 30, 2021, interest expense and other, net,
increased $1.5 million and $1.5 million, respectively, primarily due to rising
interest rates. The impact of rising interest rates on our interest expense was
partially offset by our voluntary $35.0 million prepayment of principal
outstanding under our Term Loan in August 2022. As the interest rate on our Term
Loan is variable at the London Interbank Offered Rate, we expect for our
interest expense to increase in future periods due to increasing interest rates.

                                  INCOME TAXES

We recorded an income tax benefit of $1.7 million and income tax expense of
$4.1 million for the three and nine months ended September 30, 2022,
respectively. We recorded an income tax benefit of $0.8 million and income tax
expense of $2.9 million for the three and nine months ended September 30, 2021,
respectively. The prior period interim tax provision was prepared by applying a
year-to-date effective tax rate to income before income taxes. The current
period interim tax provision was prepared by applying an estimated annual
effective tax rate to income before income taxes and by calculating the tax
effect of discrete items recognized during the quarter (if applicable).

Our effective income tax rate for the three and nine months ended September 30,
2022, and September 30, 2021 differed from the 21% statutory rate primarily due
to the release of valuation allowances and the effect of state income taxes. We
maintain a valuation allowance for federal net operating loss carryforwards that
we have concluded it is more likely than not that the related deferred tax
benefits will not be realized. This valuation allowance does not prevent us from
utilizing unexpired net operating losses to offset taxable income in future
periods. The majority of these net operating losses will either be utilized or
expire between 2022 and 2024.

                          NON-GAAP FINANCIAL MEASURES

Adjusted EBITDA


We define Adjusted EBITDA as net income (loss), determined in accordance with
GAAP, excluding the effects of stock-based compensation, depreciation and
amortization of acquired intangible assets, interest expense and other, net,
acquisition and integration costs, contested proxy, transaction and other legal
and consulting costs, and income tax (benefit) expense. Interest expense and
other, net primarily consists of interest expense, net. Acquisition and
integration costs primarily relate to the acquisitions of Avantax Planning
Partners and 1st Global.

We believe that Adjusted EBITDA provides meaningful supplemental information
regarding our performance. We use this non-GAAP financial measure for internal
management and compensation purposes, when publicly providing guidance on
possible future results, and as a means to evaluate period-to-period
comparisons. We believe that Adjusted EBITDA is a common measure used by
investors and analysts to evaluate our performance, that it provides a more
complete understanding of the results of operations and trends affecting our
business when viewed together with GAAP results, and that management and
investors benefit from referring to this non-GAAP financial measure. Items
excluded from Adjusted EBITDA are significant and necessary components to the
operations of our business and, therefore, Adjusted EBITDA should be considered
as a supplement to, and not as a substitute for or superior to, GAAP net income
(loss). Other companies may calculate Adjusted EBITDA differently and,
therefore, our Adjusted EBITDA may not be comparable to similarly titled
measures of other companies.

                      Blucora, Inc. | Q3 2022 Form 10-Q 32
--------------------------------------------------------------------------------

A reconciliation of GAAP net income (loss), which we believe to be the most comparable GAAP measure, to Adjusted EBITDA, is shown below:

                                                    Three Months Ended September 30,              Nine Months Ended
($ in thousands)                                                                                    September 30,
                                                        2022                2021               2022               2021
Net income (loss)                                   $  (21,841)         $ (27,803)         $  52,204          $  31,451
Stock-based compensation                                 5,706              4,729             17,129             15,499
Depreciation and amortization of acquired
intangible assets                                       12,362             10,915             35,131             32,498
Interest expense and other, net                          9,749              8,295             25,707             24,202

Acquisition and integration – Excluding change in fair value of HKFS contingent consideration

                416                541                610              9,013
Acquisition and integration-Change in the fair
value of HKFS Contingent Consideration                       -              1,700             (5,320)            19,500

Contested proxy, transaction and other legal and
consulting costs                                         2,987              1,598              7,304              7,293
Income tax (benefit) expense                            (1,726)              (774)             4,099              2,920
Adjusted EBITDA                                     $    7,653          $    (799)         $ 136,864          $ 142,376

Non-GAAP net income (loss) and non-GAAP net income (loss) per share


We define Non-GAAP Net Income (Loss) as net income (loss), determined in
accordance with GAAP, excluding the effects of stock-based compensation,
amortization of acquired intangible assets, acquisition and integration costs,
contested proxy, transaction and other legal and consulting costs, the related
cash tax impact of those adjustments, and non-cash income tax (benefit) expense.
We exclude the non-cash portion of income taxes because of our ability to offset
a substantial portion of our cash tax liabilities by using deferred tax assets,
which primarily consist of U.S. federal net operating losses. The majority of
these net operating losses will expire, if not utilized, between 2022 and 2024.

We believe that Non-GAAP Net Income (Loss) and Non-GAAP Net Income (Loss) per
share provide meaningful supplemental information to management, investors, and
analysts regarding our performance and the valuation of our business by
excluding items in the statement of operations that we do not consider part of
our ongoing operations or that have not been, or are not expected to be, settled
in cash. Additionally, we believe that Non-GAAP Net Income (Loss) and Non-GAAP
Net Income (Loss) per share are common measures used by investors and analysts
to evaluate our performance and the valuation of our business. Non-GAAP Net
Income (Loss) and Non-GAAP Net Income (Loss) per share should be evaluated in
light of our financial results prepared in accordance with GAAP and should be
considered as a supplement to, and not as a substitute for or superior to, GAAP
net income (loss) and GAAP net income (loss) per share. Other companies may
calculate Non-GAAP Net Income (Loss) and Non-GAAP Net Income (Loss) per share
differently, and, therefore, these measures may not be comparable to similarly
titled measures of other companies.

                      Blucora, Inc. | Q3 2022 Form 10-Q 33
--------------------------------------------------------------------------------

A reconciliation of GAAP net income (loss) and GAAP net income (loss) per share,
which we believe to be the most comparable GAAP measures, to Non-GAAP Net Income
(Loss) and Non-GAAP Net Income (Loss) per share, respectively, is presented
below:
                                                    Three Months Ended September 30,             Nine Months Ended
($ in thousands)                                                                                   September 30,
                                                        2022                2021              2022               2021
Net income (loss)                                   $  (21,841)         $ (27,803)         $ 52,204          $  31,451
Stock-based compensation                                 5,706              4,729            17,129             15,499
Amortization of acquired intangible assets               6,342              7,009            19,435             21,247

Acquisition and integration – Excluding change in fair value of HKFS contingent consideration

                416                541               610              9,013
Acquisition and integration-Change in the fair
value of HKFS Contingent Consideration                       -              1,700            (5,320)            19,500

Contested proxy, transaction and other legal and
consulting costs                                         2,987              1,598             7,304              7,293

Cash tax impact of adjustments to GAAP net income
(loss)                                                    (319)              (331)           (1,631)            (1,523)
Non-cash income tax (benefit) expense                   (3,071)              (197)            1,090             (1,160)
Non-GAAP Net Income (Loss)                          $   (9,780)         $ (12,754)         $ 90,821          $ 101,320
Per diluted share:
Net income (loss) (1)                               $    (0.46)         $   (0.57)         $   1.06          $    0.64
Stock-based compensation                                  0.12               0.10              0.35               0.31
Amortization of acquired intangible assets                0.14               0.14              0.40               0.43

Acquisition and integration – Excluding change in fair value of HKFS contingent consideration

               0.01               0.01              0.01               0.18
Acquisition and integration-Change in the fair
value of HKFS Contingent Consideration                       -               0.03             (0.11)              0.39

Contested proxy, transaction and other legal and
consulting costs                                          0.06               0.04              0.15               0.15

Cash tax impact of adjustments to GAAP net income
(loss)                                                   (0.01)             (0.01)            (0.03)             (0.03)
Non-cash income tax (benefit) expense                    (0.06)                 -              0.02              (0.02)

Non-GAAP net earnings (loss) per share – Diluted $(0.20) $(0.26) $1.85 $2.05
Diluted weighted average number of shares outstanding

             47,847             48,707            49,153             49,373


____________________________

(1)Any difference in the "per diluted share" amounts between this table and the
condensed consolidated statements of operations is due to using different
diluted weighted average shares outstanding in the event that there is GAAP net
loss but Non-GAAP Net Income and vice versa.

                        LIQUIDITY AND CAPITAL RESOURCES

Cash and cash equivalents


Our principal source of liquidity is our cash and cash equivalents. As of
September 30, 2022, we had cash and cash equivalents of $91.1 million. We
generally invest our excess cash in money market funds that are made up of
securities issued by agencies of the U.S. government. We may invest, from
time-to-time, in other vehicles, such as debt instruments issued by the
U.S. federal government and its agencies, international governments,
municipalities, and publicly held corporations, as well as commercial paper and
insured time deposits with commercial banks. Specific holdings can vary from
period to period depending upon our cash requirements. Our financial instrument
investments held as of September 30, 2022 had minimal default risk and
short-term maturities.

Our Avantax Wealth Management broker-dealer subsidiary operates in a highly
regulated industry and is subject to various regulatory capital requirements.
Failure to meet minimum capital requirements can initiate certain mandatory and
possible additional discretionary actions by regulators that, if undertaken,
could have substantial monetary and non-monetary impacts on Avantax Wealth
Management operations. As of September 30, 2022, Avantax Wealth Management met
all capital adequacy requirements to which it was subject.

Historically, we have financed our operations primarily from cash provided by
operating activities and access to credit markets. Our historical uses of cash
have been funding our operations, servicing our debt obligations, capital
expenditures, acquisitions that enhance our strategic position, financial
professional loans, contingent consideration associated with our acquisitions,
and share repurchases under share repurchase programs. For at least the next
twelve months, we plan to finance these cash needs and our regulatory capital
requirements at our broker-dealer

                      Blucora, Inc. | Q3 2022 Form 10-Q 34
--------------------------------------------------------------------------------

subsidiary largely through our cash and cash equivalents on hand and cash
provided by operating activities. Execution of our growth strategies in our
Wealth Management business through strategic asset acquisitions is expected to
remain a capital allocation priority during the next twelve months. However, the
underlying levels of revenues and expenses that we project may not prove to be
accurate, and, from time to time, we may make a determination to draw on the
Revolver (as defined below) or increase the principal amount of the Term Loan
(as defined below) to meet our capital requirements, subject to customary terms
and conditions. Our future investments in our business through capital
expenditures or acquisitions, prepayment of debt to achieve optimal leverage
ratios, or our return of capital to stockholders through stock repurchases, will
be determined after considering the best interests of our stockholders.

Debt


In May 2017, we entered into a credit agreement (as the same has been amended,
the "Credit Agreement") with a syndicate of lenders that provides for a term
loan facility (the "Term Loan") and a revolving line of credit (including a
letter of credit sub-facility) (the "Revolver") for working capital, capital
expenditures, and general business purposes (as amended, the "Senior Secured
Credit Facility"). The Term Loan has a maturity date of May 22, 2024 (the "Term
Loan Maturity Date").

On April 26, 2021, to ensure adequate liquidity and flexibility to support
growth, we entered into Amendment No. 5 to the Credit Agreement (the "Credit
Agreement Amendment"). Pursuant to the Credit Agreement Amendment, the Credit
Agreement was amended to, among other things, refinance the existing
$65.0 million Revolver and add $25.0 million of additional revolving credit
commitments, for an aggregate principal amount of $90.0 million in revolving
credit commitments (the "New Revolver"). The New Revolver has a maturity date of
February 21, 2024 (the "New Revolver Maturity Date").

As of September 30, 2022, we had $525.4 million in principal amount outstanding
under the Term Loan and no amounts outstanding under the New Revolver. Based on
aggregate loan commitments as of September 30, 2022, approximately $90.0 million
was available for future borrowing as of September 30, 2022 under the Senior
Secured Credit Facility, subject to customary terms and conditions, including
caps on the amount of Company share repurchases during each fiscal year based,
in part, on specified Net Leverage Ratios. In addition, the Company is required
to make principal amortization payments on the Term Loan quarterly on the last
business day of each March, June, September, and December, in an amount equal to
approximately $0.5 million (subject to reduction for prepayments), with the
remaining principal amount of the Term Loan due on the Term Loan Maturity Date.
On August 5, 2022, and as provided for within our Senior Secured Credit
Facility, we voluntarily prepaid $35.0 million of principal outstanding under
our Term Loan. At our election, this prepayment was first applied to the
remaining quarterly principal amortization payments due on the Term Loan, with
the remaining amount applied to the principal amount due at the Term Loan
Maturity Date.

The interest rate on the Term Loan is variable at the London Interbank Offered
Rate (subject to a floor of 1.0%), plus the applicable interest rate margin of
4.0% for Eurodollar Rate Loans (as defined in the Credit Agreement) and 3.0% for
ABR Loans (as defined in the Credit Agreement). As of September 30, 2022, the
applicable interest rate on the Term Loan was 6.3%. Depending on the
Consolidated First Lien Net Leverage Ratio (as defined in the Credit Agreement),
the applicable interest rate margin on the New Revolver ranges from 2.0% to 2.5%
for Eurodollar Rate Loans and 1.0% to 1.5% for ABR Loans. The Company is
required to pay a commitment fee on the undrawn commitment under the New
Revolver in a percentage that is dependent on the Consolidated First Lien Net
Leverage Ratio that ranges from 0.35% to 0.4%. Interest is payable at the end of
each interest period, typically quarterly.

By June 2023, all U.S. Dollar London Interbank Offered Rate ("LIBOR") tenors
will cease to be published and floating rate instruments that used U.S. Dollar
LIBOR will need to shift to a substitute base index. To minimize disruption
arising from such transition, the market has begun to shift to alternative
fallback rates, such as Secured Overnight Financing Rate ("SOFR") as a
replacement benchmark for floating rate LIBOR based loans. Unless (i) such LIBOR
tenors cease to be provided at an earlier date or (ii) we and the administrative
agent to the Credit Agreement make an "early opt-in election" to replace the
rate prior to cessation of LIBOR in accordance with the Credit Agreement, we
will continue to have the option under the Credit Agreement to make drawdowns
using 1-Day, 1-Month, 3-Month, and 6-Month tenor U.S. Dollar LIBOR until June
2023. The Credit Agreement Amendment provides for a process for transition to a
fallback rate consistent with industry practice and permits the administrative

                      Blucora, Inc. | Q3 2022 Form 10-Q 35
--------------------------------------------------------------------------------

Credit Agreement Agent to apply certain updates to the Credit Agreement to effect the Fallback Rate, including a historical basis spread adjustment between LIBOR and the Fallback Rate.


Obligations under the Senior Secured Credit Facility are guaranteed by certain
of the Company's subsidiaries and secured by substantially all the assets of the
Company and certain of its subsidiaries (including certain subsidiaries acquired
in the acquisition of Avantax Planning Partners and certain other material
subsidiaries). The Senior Secured Credit Facility includes financial and
operating covenants (including a Consolidated Total Net Leverage Ratio), which
are set forth in detail in the Credit Agreement.

Pursuant to the Credit Agreement Amendment, if the Company's usage of the New
Revolver exceeds 30% of the aggregate commitments under the New Revolver on the
last day of any calendar quarter, the Company shall not permit the Consolidated
Total Net Leverage Ratio (as defined in the Credit Agreement) to exceed (i) 4.75
to 1.00 for the period beginning on April 1, 2021 and ending on December 31,
2021, (ii) 4.25 to 1.00 for the period beginning on January 1, 2022 and ending
on September 30, 2022, (iii) 4.00 to 1.00 for the period beginning on October 1,
2022 and ending on December 31, 2022, and (iv) 3.50 to 1.00 for the period
beginning on January 1, 2023 and ending on the New Revolver Maturity Date.

Except as described above, the New Revolver has substantially the same terms as
the previous Revolver, including certain covenants and events of default. The
Company was in compliance with the debt covenants of the Senior Secured Credit
Facility as of September 30, 2022.

For more information on the term loan, the new revolver and the credit agreement, see “Item 1. Financial statements – Note 5”.

TaxAct sales transaction

The TaxAct sale transaction is expected to yield net after-tax cash proceeds of approximately $620.0 million. We plan to use the net proceeds to repay existing debt and return excess capital to shareholders.

Share buyback plan


As of December 31, 2021, we had $100.0 million authorized under our stock
repurchase plan. Pursuant to the stock repurchase plan, share repurchases may be
made through a variety of methods, including open market or privately negotiated
transactions. The timing and number of shares repurchased will depend on a
variety of factors, including price, general business and market conditions,
restrictions in our Credit Agreement, and alternative investment opportunities.
Our repurchase program does not obligate us to repurchase any specific number of
shares, may be suspended or discontinued at any time, and does not have a
specified expiration date. Any repurchases of our stock pursuant to the stock
repurchase plan may materially reduce the amount of cash we have available and
may not materially enhance the long-term value of our business or our stock.

For the three months ended September 30, 2022, we did not repurchase any shares
of our common stock under the stock repurchase plan. For the nine months ended
September 30, 2022, we repurchased approximately 1.9 million shares of our
common stock under the stock repurchase plan for an aggregate purchase price of
approximately $35.0 million. The remaining authorized amount under the stock
repurchase plan as of September 30, 2022, was approximately $65.0 million. For
the three and nine months ended September 30, 2021, we did not repurchase any
shares of our common stock under the stock repurchase plan.

For fiscal year 2022, restrictions in our Credit Agreement capped our share
repurchases at $35.0 million. Subject to the terms of our Credit Agreement, a
portion of our future capital requirements during fiscal year 2023 may encompass
share repurchases under this plan.

Contractual obligations and commitments

On July 1, 2020we finalized the acquisition of Avantax Planning Partnersformerly “HKFS”, for an initial cash purchase price of $104.4 million. The purchase price was subject to variable contingent consideration or price supplements (the “HKFS Contingent Consideration”) totaling a maximum of
$60.0 million.


The amounts owed for the HKFS Contingent Consideration were determined based on
advisory asset levels (i) for the period beginning July 1, 2020 and ending June
30, 2021 and (ii) for the period beginning July 1, 2021 and ending June 30,
2022. Pursuant to the Stock Purchase Agreement, dated as of January 6, 2020, by
and among the Company, HKFS, the selling stockholders named therein (the
"Sellers"), and JRD Seller Representative, LLC, as the Sellers' representative
(as amended on April 7, 2020, June 30, 2020, and June 29, 2021) (the "HKFS
Purchase

                      Blucora, Inc. | Q3 2022 Form 10-Q 36
--------------------------------------------------------------------------------

Agreement"), the maximum aggregate amount that we were required to pay for each
earn-out period was $30.0 million. If the asset market values on the applicable
measurement date fell below certain specified thresholds, no payment of
consideration was owed to the Sellers for such period.

Based on advisory asset levels for each earn-out period, we paid the full $30.0
million to the Sellers in the third quarter of 2021 for the first earn-out, and
$23.0 million in the third quarter of 2022 for the second earn-out. There are no
remaining contingent payments due to the Sellers as of September 30, 2022.

In addition, the Company has entered into several asset purchase agreements that
are accounted for as asset acquisitions. These acquisitions may include up-front
cash consideration, fixed deferred cash consideration, and contingent
consideration arrangements. Future fixed payments are recognized as customer
relationship intangible assets on the date of acquisition. Contingent
consideration arrangements encompass obligations to make future payments to the
previous sellers contingent upon the achievement of future financial targets.
These contingent payments are not recognized until all contingencies are
resolved and the consideration is payable. As of September 30, 2022, the maximum
future fixed and contingent payments associated with these asset acquisitions
was $23.7 million, with specified payment dates from 2022 through 2026. During
the three months ended September 30, 2022, variable contingent consideration
related to prior asset acquisitions became payable for approximately
$1.5 million, which is included within the $23.7 million discussed above. This
accrued consideration is within customer relationship intangibles and is
expected to be paid during the fourth quarter of 2022.

Cash flow

Our cash flows consisted of the following (in thousands):

Nine month period ended September 30,

                                                                    2022                  2021             $ Change
Net cash provided by operating activities                    $     61,916              $ 74,391          $ (12,475)
Net cash used by investing activities                             (20,897)              (25,447)             4,550
Net cash used by financing activities                             (84,739)              (14,244)           (70,495)

Net increase (decrease) in cash, cash equivalents and restricted cash

                                              $    (43,720)             $ 34,700          $ (78,420)

© Edgar Online, source Previews

]]>
Pension funds or cryptocurrency, which is the biggest scam? https://berningcpa.com/pension-funds-or-cryptocurrency-which-is-the-biggest-scam/ Sat, 29 Oct 2022 15:24:46 +0000 https://berningcpa.com/pension-funds-or-cryptocurrency-which-is-the-biggest-scam/ The lack of transparency in our nation’s public pensions makes scamming easier than crypto fraud. Getty The lack of transparency in our country’s public pensions makes it easier to scam than cryptocurrency fraud. Public pension funds or cryptocurrency, which is the biggest scam? The surprising answer is pension funds, according to Anessa Santos, a Florida […]]]>

The lack of transparency in our country’s public pensions makes it easier to scam than cryptocurrency fraud.

Public pension funds or cryptocurrency, which is the biggest scam? The surprising answer is pension funds, according to Anessa Santos, a Florida attorney and special magistrate specializing in blockchain and fintech, and why has everything to do with transparency, she says..

Long touted as offering retirement security to American workers, pension plans apparently promise employees that if they contribute a portion of their income to the plan today, they are guaranteed continued income until retirement. . According Data on public plans, the 2020 U.S. Census reported that we have approximately 6,000 public sector pension systems that collectively hold $4.5 trillion in assets for 25.9 million public servants and retirees, and distribute $323 billion per year. This is a huge pool of money known to attract the wolves of Wall Street, including fund managers and financial advisers who exploit regulatory loopholes and plan administration vulnerabilities to enrich themselves on expense of retirees.

Public pensions, unlike company plans, are not subject to ERISA – the federal law protecting pensions – or any comparable comprehensive state regulatory regime. As a result, Wall Street considers public pensions “the dumbest investors in the room” and reserves its most outrageous practices for these stooges.

According to a 2016 study by Pew Charitable Trusts, state retirement systems receive limited guidance and standards for plan management and expense disclosure from the Governmental Accounting Standards Board and the Government Finance Officers Association’s Best Practice for Public Employee Retirement Systems Investments. State and local government pension plans are interpreting these rules differently, with some embracing greater plan transparency while others seem more interested in shielding Wall Street from public scrutiny over government fees and corrupt practices. ‘industry. The magnitude of the problem appears in PEW artwork how public pension fund allocations to alternative investments (such as hedge, private equity and real estate funds) doubled from 11% in 2006 to 25% in 2013. (As I point out in my book, Who stole my pension?, all of the public pension plans I have investigated significantly under-report their holdings of alternative investments. The true average allocation to alts is probably closer to 40% or more.)

This radical departure from publicly traded investments is deeply concerning, as alternative investments are widely considered to be high risk and high cost. These investment products provide a loophole for Wall Street fund managers to demand secrecy and eviscerate state public records laws. Hedge fund managers claim that the excessive and bogus fees they charge are “trade secrets” exempt from disclosure to pension plan stakeholders.

“Think of these private investments like nesting Russian dolls,” says Santos. “The pension plan pays to invest in one fund, which pays to invest in another fund made up of multiple high-risk financial products, each potentially charging additional misdisclosed or hidden fees.”

Updated research published by the Center for Retirement Research at Boston College this August confirms that while significant regulatory safeguards have been put in place since the Pew study, they don’t matter much as fiscal 2022 returned “…losses of record investment and an increase in pension spending…”. In a recent headline, the Reason Foundation warned that “unfunded public pension liabilities are expected to reach $1.3 trillion in 2022.” In response, class action lawsuits have exploded. According to Human Resource Management Company, since 2020, more than 200 new class action lawsuits have been filed under ERISA, and another 100 for breach of fiduciary duty for fees charged to plan participants, and more lawsuits are expected. Tragically, class action lawsuits alleging mismanagement of public pensions are nearly impossible to bring under state law (since ERISA does not apply).

The underlying causes of poor pension fund management are many, but lack of transparency is almost always at the root of the problem. The sun is, and always has been, the best disinfectant. If pension plans and all of their investments were completely transparent and open to public scrutiny, fraud would be much harder to hide.

Unlike public pensions, attorney Santos says, the world’s first cryptocurrency, bitcoin, runs on a completely transparent platform called “blockchain” that has proven to be resistant to fraud and hacking. intentionally. “If you’ll tiptoe with me through the weeds of blockchain technology for a moment,” she says, “I’ll explain how it can radically change the rules of the game for pension funds in favor of attendees.”

Blockchain, simply described, is a new way to track small details, and it solves many problems we have with our current data management systems, especially when it comes to privacy and data security, says- she. Basically, blockchain is a decentralized network that stores digital information in blocks. Each new block of information is timestamped, numbered in order, and appended to the previous block, forming a chain. Anyone, anywhere can help maintain the blockchain network by running a copy of the software on their computer. These computers, called “network nodes,” each replicate the full transaction history of the blockchain. Each transaction is verified and confirmed by at least 51% of network nodes before being encrypted and written to the blockchain. Once recorded, the software does not allow modifications, leaving a perfect record for listeners. Blockchain, Santos says, has proven impenetrable by bad actors where the network has achieved “decentralization,” meaning no one person or organization can control its operation.

Although there are debates about what it means to be decentralized, there is consensus that bitcoin and ethereum blockchains have achieved it. This is why the Prime Minister of Canada, Justin Trudeau, could not stop the transmission of bitcoins to Canadians during the truckers’ protest. The Bitcoin blockchain is so huge, spanning the breadth and depth of the globe, that it would take shutting down the global internet, forever, to kill it.

“Every transaction ever made on publicly available blockchains like Bitcoin and Ethereum is always completely transparent for public inspection. Once an individual is connected to a transaction, their activity can be traced upstream, downstream and across the chain. Try doing that with money!

Imagine if every government transaction was recorded on a decentralized, immutable, and publicly visible blockchain, Santos says. There would be no more mystery articles or black budgets, because this is the ultimate truth-telling machine.

Santos believes that the cryptocurrency fraud we hear so much about isn’t about this core technology, but rather is generally associated with cheap counterfeits and derivatives. These are counterfeits offered by wolves in sheep’s clothing that prey on the hopeful and uninformed, including retirees who have also been scammed by regulated fund managers and financial advisers posing as trustees. .

When I asked her how investors could discern the difference, she replied that it was not easy and that it would take another article to detail it. In the meantime, says Santos, consider the following: “How is it that, despite a seemingly complex regulatory framework, retirees continue to be legally deprived of their savings? How come we have a perfect solution to corruption, but it is never implemented? Why is cash the king of anonymity, but we focus on clearing crypto when proven to be traceable? Someone, or someone, benefits from maintaining the status quo. Who? Follow the money.”

I am not an expert on cryptocurrency transparency but I am familiar with public repos. And, based on 40 years of forensic experience, I can assure you that the fastest way to end public pension fraud is to restore the full transparency once required by state records laws. public.

]]>
Weiss Law investigates IMARA Inc. https://berningcpa.com/weiss-law-investigates-imara-inc/ Fri, 14 Oct 2022 21:02:00 +0000 https://berningcpa.com/weiss-law-investigates-imara-inc/ NEW YORK, October 14, 2022 /PRNewswire/ — Weiss’ law investigation of possible breaches of fiduciary duty and other violations of law by the board of directors of IMARA Inc. (“IMARA” or the “Company”) (NASDAQ: IMRA) in connection with the project of the Company’s merger with Enliven Therapeutics, Inc. (“Animate”). Under the terms of the merger […]]]>

NEW YORK, October 14, 2022 /PRNewswire/ — Weiss’ law investigation of possible breaches of fiduciary duty and other violations of law by the board of directors of IMARA Inc. (“IMARA” or the “Company”) (NASDAQ: IMRA) in connection with the project of the Company’s merger with Enliven Therapeutics, Inc. (“Animate”). Under the terms of the merger agreement, IMARA will issue IMARA common stock as consideration for the merger in exchange for the cancellation of shares of Enliven’s capital stock and Enliven will become a wholly owned subsidiary of IMARA. Upon completion of the transaction, IMARA shareholders are expected to own only approximately 16% of the combined company, while Enliven shareholders are expected to own approximately 84% of the combined company.

If you own IMARA actions and wish to discuss this survey or have questions about this notice or your rights or interests, visit our website:

https://www.weisslaw.co/news-and-cases/imra
Or please contact:
Joshua Rubin, Esq.
Weiss’ law
305 Broadway, 7e Floor
New YorkNY 10007
(212) 682-3025
(888) 593-4771
[email protected]

Weiss Law is investigating whether (i) IMARA’s board of directors acted in the best interests of the company’s shareholders in agreeing to the proposed transaction, (ii) the minority stake in the combined company under the transaction proposed is fair to IMARA shareholders, and (iii) all information regarding the sale process and valuation of the transaction will be fully and fairly disclosed.

Weiss Law has litigated hundreds of shareholder class and derivative actions for breach of corporate and fiduciary duties. We’ve recovered more than $1 billion for defrauded customers and won significant corporate governance relief in many of those cases. If you have information or want legal advice regarding possible corporate wrongdoing (including insider trading, waste of company assets, accounting fraud or misleading information), fraud consumer rights (including false advertising, defective products or other deceptive marketing practices), or anti-trust violations, please email us at [email protected]

SOURCE Weiss’ Law

]]>
Guggenheim Investments named U.S. Fixed Income Manager of the Year at 2022 Insurance Asset Risk North Americas Awards https://berningcpa.com/guggenheim-investments-named-u-s-fixed-income-manager-of-the-year-at-2022-insurance-asset-risk-north-americas-awards/ Tue, 11 Oct 2022 22:14:00 +0000 https://berningcpa.com/guggenheim-investments-named-u-s-fixed-income-manager-of-the-year-at-2022-insurance-asset-risk-north-americas-awards/ NEW YORK, Oct. 11, 2022 (GLOBE NEWSWIRE) — Guggenheim Investments, the global asset management and investment advisory business of Guggenheim Partners, has been named US Fixed-Income Manager of the Year as part of the 2022 Insurance Asset Risk North Americas Awards. The annual Insurance Asset Risk North America Awards celebrate the importance and breadth of […]]]>

NEW YORK, Oct. 11, 2022 (GLOBE NEWSWIRE) — Guggenheim Investments, the global asset management and investment advisory business of Guggenheim Partners, has been named US Fixed-Income Manager of the Year as part of the 2022 Insurance Asset Risk North Americas Awards.

The annual Insurance Asset Risk North America Awards celebrate the importance and breadth of the insurance asset management business. Insurance Asset Risk magazine’s Americas Awards officially recognize the best in insurance asset management in the Americas market, judged by an independent panel of seasoned industry experts from across the Americas, chosen for their knowledge , objectivity and credibility by the editors of Insurance Asset Risk. The judges evaluated 16 categories in all.1

“We are honored to be recognized as US Fixed Income Manager of the Year by Insurance Asset Risk magazine,” said Scott Minerd, President of Guggenheim Investments and Global Chief Investment Officer of Guggenheim Partners. “Guggenheim’s fixed income management business was founded on serving insurance clients, and we have grown our business not only through our portfolio management performance, but also through our deep understanding of business needs of insurance companies. This award validates our success and that of our customers.

Guggenheim Investments specializes in insurance asset management: $137 billion of our $228 billion in assets under management are general account assets that we manage for insurance clients. Over 250 investment professionals are engaged in asset management across fixed income, equities and alternatives.

Anne Walsh, CIO for Fixed Income at Guggenheim Investments, said, “Prior to joining Guggenheim in 2007, I was the Chief Investment Officer of an insurance company and a client of the company. Guggenheim differentiated themselves with their knowledge of the industry and I was so impressed that I decided to join their team. The Guggenheim approach is to see us as partners to our insurance clients, and our portfolio management and services are based on our common understanding of the specific regulatory, accounting and capital requirements of these companies. This leads us to develop risk mitigation and diversification solutions that can even include creating investments that help achieve a client’s goals. When constructing portfolios for insurance companies, we focus on income, which is of paramount importance to most insurance companies, as well as how investments move in concert with liabilities. , which is particularly important for life insurance companies.

Guggenheim Investments attributes its unique Investment process, rooted in behavioral finance, with its success in bond asset management. The main lesson of behavioral finance is that investors prefer to avoid losses rather than returns, a value that resonates with insurance companies that derive their competitive strength and financial success from a well-defended capital position. With this goal as a starting point, Guggenheim’s bond portfolios are managed through a systematic, disciplined, and team-based investment process designed to mitigate behavioral biases and lead to better decision-making and better potential outcomes. . Our core skills in credit, structured products and due diligence lead us to parts of the fixed income market that are not fully included in the popular benchmark, the Bloomberg US Aggregate Bond Index, a key element of our ability to seek the long term. long-term objectives of our insurance clients.

Walsh said, “We believe our ability to potentially discover value in securities outside of the traditional benchmark-driven framework informs our active management capabilities and puts our clients in the best position to seek out yield opportunities. convincing risk-adjusted. Our investment philosophy and process is organized to serve insurance companies, and we are grateful to be recognized among our peers by Insurance Asset Risk.

For more information, please visit http://www.guggenheiminvestments.com.

About Guggenheim Investments

Guggenheim Investments is the global asset management and investment advisory division of Guggenheim Partners, with over $228 billion2 of total assets in bond, equity and alternative strategies. We focus on the return and risk needs of insurance companies, private and public pension funds, sovereign wealth funds, endowments and foundations, consultants, wealth managers and high net worth investors. Our more than 250 investment professionals conduct rigorous research to understand market trends and identify undervalued opportunities in often complex and under-tracked areas. This approach to investment management has enabled us to offer innovative strategies offering opportunities for diversification and attractive long-term results.

About insurance asset risk

Insurance Asset Risk is a global source of information and analysis on insurers’ strategic asset allocation, investment strategies and relationships with internal and external asset managers. Insurance Asset Risk is published by Field Gibson Media, a London-based B2B financial publisher. Field Gibson Media also publishes InsuranceERM.com, environment-finance.com and corporatedisclosures.org.

Notices and Important Disclosures

1. The allocation was announced on 10.11.2022 for the period of 12 to 18 months before 6.30.2022. This is a subjective recognition based on the Guggenheim’s 200-word summary of why he should win, followed by an 800-word essay on what sets him apart in the insurance industry with specific examples including articles for the insurance industry, its response to COVID-19, and performance data from its Core Fixed Income strategy for insurance companies. Guggenheim was chosen from four entrants. There was no charge to enter. Compensation was paid to Insurance Asset Risk for the rights to reprint the price announcement.
2. Guggenheim Investments assets under management are as of 06/30/2022 and include leverage of $18.3 billion. Guggenheim Investments represents the following affiliated investment management companies: Guggenheim Partners Investment Management, LLC, Security Investors, LLC, Guggenheim Funds Distributors, LLC, Guggenheim Funds Investment Advisors, LLC, Guggenheim Partners Advisors, LLC, Guggenheim Corporate Funding, LLC, Guggenheim Partners Europe Limited, Guggenheim Partners Japan Limited, GS GAMMA Advisors, LLC and Guggenheim Partners India Management. Guggenheim Investments is not affiliated with WealthManagement.com or Informa PLC. Securities are offered through Guggenheim Funds Distributors, LLC, which is a member of FINRA and SIPC.

Past performance does not guarantee future returns. Investing involves risk, including possible loss of principal. Investments in fixed income instruments are subject to the possibility that interest rates will rise causing their value to decline. High yield and unrated debt securities have a higher risk of default than investment grade bonds and may be less liquid, which may increase volatility.

This material is distributed or presented for informational or educational purposes only and should not be construed as a recommendation of any particular security, strategy or investment product, or as advice to investment of any kind. This material is not provided on a fiduciary basis, may not be relied upon for or in connection with making investment decisions, and does not constitute a solicitation of an offer to buy or sell securities. The contents herein are not intended to be and should not be construed as legal or tax advice and/or legal advice. Always consult a financial, tax and/or legal professional regarding your particular situation.

This material contains the opinions of the author, but not necessarily those of Guggenheim Partners, LLC or its affiliates. The opinions contained in this document are subject to change without notice. Forward-looking statements, estimates and certain information contained herein are based on proprietary and non-proprietary research and other sources. The information contained herein was obtained from sources believed to be reliable, but its accuracy is not guaranteed. Past performance does not represent future results. There is no representation or warranty as to the current accuracy of decisions based on this information, nor any liability for it. No part of this material may be reproduced or referred to in any form without the express written permission of Guggenheim Partners, LLC.

Media Contact
Gerard Carney
Guggenheim Partners
310.871.9208
Gerard.Carney@guggenheimpartners.com

]]>
SHAREHOLDER ALERT: Law Firm Pomerantz Investigating Claims on Behalf of Latch, Inc. Investors … | New https://berningcpa.com/shareholder-alert-law-firm-pomerantz-investigating-claims-on-behalf-of-latch-inc-investors-new/ Thu, 06 Oct 2022 21:17:07 +0000 https://berningcpa.com/shareholder-alert-law-firm-pomerantz-investigating-claims-on-behalf-of-latch-inc-investors-new/ NEW YORK, Oct. 06, 2022 (GLOBE NEWSWIRE) — Pomerantz LLP is investigating claims on behalf of investors in Latch, Inc. (“Latch” or the “Company”) (NYSE: LTCH). these investors to contact Robert S. Willoughby at newaction@pomlaw.com or 888-476-6529 ext. 7980. The investigation focuses on whether Latch and certain of its officers and/or directors have engaged in […]]]>

NEW YORK, Oct. 06, 2022 (GLOBE NEWSWIRE) — Pomerantz LLP is investigating claims on behalf of investors in Latch, Inc. (“Latch” or the “Company”) (NYSE: LTCH). these investors to contact Robert S. Willoughby at newaction@pomlaw.com or 888-476-6529 ext. 7980.

The investigation focuses on whether Latch and certain of its officers and/or directors have engaged in securities fraud or other illegal business practices.

[Click here for information about joining the class action]

On August 25, 2022, in a filing with the United States Securities and Exchange Commission, Latch stated that “[a]s previously disclosed by Latch, Inc. . . . on August 10, 2022, the Audit Committee of the Company’s Board of Directors (the “Audit Committee”) initiated an investigation (the “Investigation”) into possible current and past issues which include, but without limitation, certain aspects of the Company’s current and historical key performance indicators and revenue recognition practices, including accounting treatment, financial reporting and related internal controls. The company’s filing further stated that “[w]While the investigation is ongoing, on August 19, 2022, based on the preliminary findings of the investigation, the Audit Committee determined that the Company’s 2021 consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2021 and the associated report of the Company’s independent registered public accounting firm, Deloitte & Touche LLP (“Deloitte”), together with the consolidated financial statements of the Company for the first quarter of 2022 included in the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2022, shall no longer be relied upon due to material errors and possible related irregularities, among other , how the Company recognized revenue associated with the sale of hardware devices during the year 2021 and the first quarter of 2022. Accordingly, the Audit Committee, in consultation with the management of the Company, determined only the Company’s consolidated financial statements for 2021 and the first quarter of 2022 will be restated.

On this news, Latch’s stock price fell $0.13 per share, or 12.22%, to close at $0.95 per share on August 26, 2022.

Pomerantz LLP, with offices in New York, Chicago, Los Angeles, Paris and Tel Aviv, is recognized as one of the leading law firms in the areas of corporate litigation, securities and antitrust. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues the tradition he established, fighting for the rights of victims of securities fraud, breaches of fiduciary duty and corporate misconduct. The firm recovered numerous multimillion-dollar damages on behalf of class members. See www.pomlaw.com.

CONTACT:

Robert S. Willoughby

Pomerantz LLP

rswilloughby@pomlaw.com

888-476-6529 ext. 7980

Copyright 2022 GlobeNewswire, Inc.

]]>