TiVo 2015 Annual Report Download - page 31

Table of Contents
If we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements could be impaired, which could increase
our operating costs and affect our ability to operate our business.
We have a complex business that is international in scope. Ensuring that we have adequate internal controls and procedures in place to help
ensure that we can produce accurate financial statements on a timely basis is a costly and time - consuming effort that needs to be re - evaluated frequently.
We are continually in the process of documenting, reviewing and, if appropriate, improving our internal controls and procedures in connection with
Section 404 of the Sarbanes - Oxley Act of 2002, which requires annual management assessments of the effectiveness of our internal control over financial
reporting and a report by our independent registered public accountants on the effectiveness of our internal controls over financial reporting. If we or our
independent registered public accountants identify areas for further attention or improvement, implementing any appropriate changes to our internal
controls may require specific compliance training of our directors, officers and employees, entail substantial costs in order to modify our existing
accounting systems, and take a significant period of time to complete. We have in the past identified, and may in the future identify, significant deficiencies
in the design and operation of our internal controls, which have been or will in the future need to be remediated. Furthermore, our independent registered
public accountants may interpret the Section 404 requirements and the related rules and regulations differently from how we interpret them, or our
independent registered public accountants may not be satisfied with our internal control over financial reporting or with the level at which these controls
are documented, operated or reviewed in the future. Finally, in the event we make a significant acquisition, or a series of smaller acquisitions, we may face
significant challenges in implementing the required processes and procedures in the acquired operations. As a result, our independent registered public
accountants may decline or be unable to report on the effectiveness of our internal controls over financial reporting or may issue a qualified report in the
future. This could result in an adverse reaction in the financial markets due to investors' perceptions that our internal controls are inadequate or that we are
unable to produce accurate financial statements.
We will incur costs and demands on management as a result of complying with the laws and regulations affecting public companies, which could affect
our operating results.
We have incurred, and expect to continue to incur, significant legal, accounting and other expenses associated with corporate governance and
public company reporting requirements, including complying with the requirements of the Sarbanes
- Oxley Act of 2002, as well as rules implemented by the
SEC and NASDAQ. As long as the SEC requires the current level of compliance or more for public companies of our size, we expect these rules and
regulations to require significant legal and accounting compliance costs and to make some activities time
- consuming and costly. These rules and
regulations may make it more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and
coverage or incur substantially higher costs to obtain the same or similar coverage than was previously available. As a result, it may be more difficult for us
to attract and retain qualified individuals to serve on our board of directors or as our executive officers.
We may be subject to assessment of sales and other taxes for the sale of our products, license of technology or provision of services.
We generally do not collect sales or other taxes on the sale of our products, license of technology or provision of services. Our business would be
harmed if one or more states or any foreign country required us to collect sales or other taxes from past or future sales of products, licenses of technology
or provision of services, particularly because we may be unable to go back to customers to collect sales taxes for past sales and would likely have to pay
such taxes out of our own funds.
The price of our common stock may be volatile.
The market price of our common stock has been, and in the future could be, significantly affected by factors such as:
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actual or anticipated fluctuations in operating results;
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announcements of renewal or termination of major contracts;
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announcements of technical innovations;
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new products, services or contracts;
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announcements by competitors or their customers;
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announcements by our customers;
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governmental regulatory and copyright action;
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developments with respect to patents or proprietary rights;
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announcements regarding acquisitions or divestitures;
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announcements regarding litigation or regulatory matters;
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changes in financial estimates or coverage by securities analysts;