ARHS Arhaus, Inc.

“The material weaknesses will not be remediated until the necessary internal controls have been designed, implemented, tested and determined to be operating effectively.”

“In preparation of the December 31, 2023 consolidated financial statements and in preparation of the March 31, 2024 condensed consolidated financial statements, these material weaknesses resulted in restatements as of and for the interim period ended September 30, 2023”

“These material weaknesses resulted in a restatement of our previously issued annual consolidated financial statements as of and for the years ended December 31, 2020 and 2019 principally related to selling, general and administrative expenses and other long-term liabilities, and misclassifications in the balance sheets and statements of comprehensive income.”

“Lastly, we did not design and maintain effective controls over information technology ( IT ) general controls for information systems that are relevant to the preparation of our financial statements.”

“We did not design and maintain sufficient accounting policies, procedures and controls, or maintain adequate documentary evidence of existing control activities over significant accounts and disclosures to achieve complete, accurate and timely financial accounting, reporting and disclosures, including adequate controls over the period-end financial reporting process and the preparation and review of journal entries, including assessing the reliability of reports and spreadsheets used in controls.”

“We did not design and maintain an effective control environment due to a lack of an appropriate level of experience and training related to internal control over financial reporting.”

“Based upon that evaluation as of September 30, 2026, our CEO and CFO have concluded that our disclosure controls and procedures were not effective at the reasonable assurance level because of the material weaknesses in our internal control over financial reporting described below.”