Los Angeles-based bank holding company Broadway Financial Corp. disclosed in a public filing weaknesses discovered in its internal control over financial reporting (ICFR) because of training shortfalls.

In its annual report, filed Monday, the firm said it identified material ICFR weaknesses that could affect its ability to “record, process, and report financial information accurately; impair our ability to prepare financial statements; negatively affect investor confidence; and cause reputational harm.”

Broadway said the weaknesses related to not maintaining a “sufficient complement of personnel with appropriate levels of knowledge, experience, and training in internal control matters to perform assigned responsibilities and have appropriate accountability for the design and operation of [ICFR].”

The lack of skilled and trained personnel contributed to the company’s failure to design, implement, and consistently operate certain internal controls causing material weaknesses in its control environment, the company said.

These deficiencies led to ICFR weaknesses related to risk assessments, along with control and monitoring activities.

The firm further disclosed that, because of the ICFR weaknesses, its “disclosure controls and procedures were not effective as of December 31, 2023.”

Broadway said the firm initially disclosed the issue in a public filing in September 2023 after determining its “disclosure controls and procedures and [ICFR] were not effective as of September 30, 2023.”

Broadway added the company is actively engaged in remediation efforts to address the weaknesses, but “there can be no assurance that the efforts will fully remediate the material weakness in a timely manner.”

The firm could not predict forthcoming enforcement actions or related costs associated with litigation.