Brownie’s Marine cuts Q2 2026 net income to $219K
Rhea-AI Filing Summary
Brownie’s Marine Group, Inc. (BWMG) disclosed that its unaudited consolidated financial statements for the three and six months ended June 30, 2026, in the Form 10‑Q filed August 4, 2026, should no longer be relied upon because of accounting and financial reporting errors.
The main error was use of financial information from an incorrect reporting year for the three months ended June 30, 2026. Corrections change operating results for that quarter from a loss of $151,080 to income of $22,716, and revise reported net income from $580,542 to $218,658, and include an out‑of‑period related‑party interest adjustment and an equity roll‑forward correction.
The company had previously identified material weaknesses in internal control over financial reporting, particularly in period‑end close and reconciliation, which contributed to the errors. Management and the board are implementing remediation measures, including enhanced reviews, stronger close and reconciliation procedures, added review checkpoints, technology‑assisted (AI‑enabled) analytical testing, and financial reporting personnel changes. An amended Form 10‑Q will be filed to restate the affected financial statements, and the company’s auditor, Bush & Associates, CPA, concurs with the conclusion on non‑reliance.
Positive
- None.
Negative
- Financial statement non‑reliance and restatement: Q2 2026 unaudited financials can no longer be relied upon and will be restated, indicating significant financial reporting issues.
- Net income materially reduced: Q2 2026 reported net income is being corrected from $580,542 to $218,658, a substantial downward adjustment.
- Material weaknesses in internal controls: The company confirms its internal control over financial reporting and disclosure controls were not effective as of June 30, 2026, with weaknesses in period‑end close and reconciliation contributing to the errors.
8-K Event Classification
Item 4.02 — Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
1 item
Item 4.02
Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
Governance
Previously issued financial statements, a related audit report, or a completed interim review should no longer be relied upon.
Key Figures
Q2 2026 operating results (before correction): loss of $151,080
Q2 2026 operating results (after correction): income of $22,716
Q2 2026 net income (before correction): $580,542
+3 more
6 metrics
Q2 2026 operating results (before correction)
loss of $151,080
Operating results for the three months ended June 30, 2026 as originally reported
Q2 2026 operating results (after correction)
income of $22,716
Corrected operating results for the three months ended June 30, 2026
Q2 2026 net income (before correction)
$580,542
Net income for the three months ended June 30, 2026 as originally reported
Q2 2026 net income (after correction)
$218,658
Corrected net income for the three months ended June 30, 2026
Quarter covered by non-reliance
three and six months ended June 30, 2026
Periods for which previously issued financial statements should not be relied upon
Board determination date
August 14, 2026
Date the board concluded the financials should no longer be relied upon
Key Terms
Non-Reliance on Previously issued Financial Statements, material weaknesses, internal control over financial reporting, period-end close, +2 more
6 terms
Non-Reliance on Previously issued Financial Statements regulatory
"Item 4.02 Non-Reliance on Previously issued Financial Statements or a Related Audit Report"
material weaknesses regulatory
"the Company has identified material weaknesses in its internal control over financial reporting"
Material weaknesses are significant flaws in a company’s systems for ensuring its financial reports are accurate and reliable. Like a broken lock on a safe, they increase the chance that financial statements contain big errors or omissions, which can mislead investors about performance and risk; discovering one often raises questions about management oversight, may lead to restated results, and can affect investor confidence and a company’s valuation.
internal control over financial reporting regulatory
"its internal control over financial reporting and disclosure controls and procedures were not effective"
Internal control over financial reporting is a company’s system of procedures and checks designed to make sure its financial statements are accurate and complete, like a set of guardrails and verification steps that catch mistakes or fraud before numbers are published. Investors care because strong controls make reported results more trustworthy, lower the risk of surprise restatements or regulatory problems, and give greater confidence when valuing the company or comparing it to peers.
period-end close financial
"deficiencies in the Company’s period-end close and reconciliation controls"
Amended Report regulatory
"intends to file an amendment to the Form 10-Q (the “Amended Report”)"
AI-enabled analytical testing technical
"Implementing technology-assisted financial review procedures, including AI-enabled analytical testing"
FAQ
What did BWMG disclose in this 8-K about its June 30, 2026 financials?
Brownie’s Marine Group, Inc. stated that its unaudited financial statements for the three and six months ended June 30, 2026 in the August 4, 2026 Form 10‑Q should no longer be relied upon due to accounting and financial reporting errors and will be restated in an amended report.
How are BWMG’s Q2 2026 operating results changing in the restatement?
For the three months ended June 30, 2026, operating results are being corrected from a loss of $151,080 to income of $22,716, due to errors tied to using financial information from an incorrect reporting year and related control deficiencies.
How is BWMG’s Q2 2026 net income being revised?
Reported net income for the three months ended June 30, 2026 is being corrected from $580,542 to $218,658. The company’s review identified errors affecting revenue, gross profit, operating results, other income, and net income that require restatement.
What internal control issues did BWMG identify as of June 30, 2026?
Brownie’s Marine Group reported material weaknesses in internal control over financial reporting and concluded its internal control and disclosure controls and procedures were not effective, citing deficiencies in period‑end close and reconciliation processes as contributing factors to the misstatements.
What remediation steps is BWMG taking to address its control weaknesses?
The company is enhancing management and board‑level review of filings, strengthening period‑end close and reconciliations, adding review checkpoints, implementing AI‑enabled analytical testing, requiring resolution of exceptions before filings, reassessing accounting organization, and making personnel and responsibility changes in the financial reporting function.
Does BWMG’s auditor agree with the non‑reliance conclusion?
Yes. Brownie’s Marine Group stated that Bush & Associates, CPA, its independent registered public accounting firm, has been informed and concurs with management’s conclusion that the previously issued financial statements should not be relied upon.
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