Nautilus 2014 Annual Report Download - page 63

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Disclosure Controls and Procedures
As of December 31, 2014
, we conducted an evaluation under the supervision and with the participation of our management, including our Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. The
term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-
15(e) under the Securities and Exchange Act of 1934, as
amended (“Exchange Act”),
means controls and other procedures of a company that are designed to ensure that information required to be
disclosed by the company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the
time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures
designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is
accumulated and communicated to the company's management, including its principal executive and principal financial officers, or persons
performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, our Chief
Executive Officer and Chief Financial Officer concluded as of December 31, 2014 that our disclosure controls and procedures were effective.
Management's Report On Internal Control Over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in
Rule 13a-
15(f) under the Exchange Act. This rule defines internal control over financial reporting as a process designed by, or under the
supervision of, our Principal Executive Officer and Principal Financial Officer, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP. Our internal control over
financial reporting includes those policies and procedures that:
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of
any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or
that the degree of compliance with the policies or procedures may deteriorate.
Management's Assessment
Our management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our internal control over
financial reporting based on the criteria established in Internal Control - Integrated Framework (2013), issued by the Committee of
Sponsoring
Organizations of the Treadway Commission. Based on this evaluation, management concluded that our internal control over financial reporting
was effective as of December 31, 2014 .
Our independent registered public accounting firm has issued an attestation report on the effectiveness of our internal control over financial
reporting as of December 31, 2014 , which is included herein.
Changes In Internal Control Over Financial Reporting
Other than as discussed below, there were no changes in our internal control over financial reporting that occurred during the three- and twelve-
months ended December 31, 2014
that have materially affected, or are reasonably likely to materially affect, our internal control over financial
reporting.
During the twelve months ended December 31, 2014
, we completed the implementation of a new enterprise resource planning ("ERP") system,
which covers all of our significant processes including, but not limited to, revenue and invoicing, purchasing, accounts payable, accounts
receivable and general ledger reporting. We believe this new ERP system and related processes enhance our internal control over financial
reporting. We may make modifications and upgrades to the ERP system in the future to further enhance our internal control over financial
reporting.
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Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our
assets;
•
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance
with U.S. GAAP, and that receipts and expenditures are being made only in accordance with authorizations of our management and
directors; and
•
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that
could have a material effect on the financial statements.