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The supermicrocomputer’s stock price fell sharply on Wednesday after accounting giant EY resigned as the company’s auditor. The accounting firm said it “does not want to be involved in the financial statements prepared by management.” The resignation comes after months of speculation about the supermicrocomputer’s accounting practices. A report from the Hindenburg investigation of short sellers accuses it of “manipulation.”
Shares in Super Micro Computers (SMCI) fell sharply on Wednesday after accounting firm EY resigned as the company’s auditor following months of speculation about its accounting practices.
EY, one of Japan’s “big four” accounting firms, told Supermicrocomputer’s board that the decision was “due to information recently brought to our attention and “Because I can no longer rely on them.” . ” EY added that it “does not want to be associated with financial statements prepared by management.”
Super Micro Computer said it disagreed with EY’s decision because the audit it commissioned last year, which it completed last year, has not yet been completed, and that the company’s accounting department will question “whether the company has demonstrated its commitment to integrity.” The agency said it takes seriously the concerns raised by the agency.
EY resigns after months of speculation over supermicrocomputer’s accounting
The resignation comes after Super Micro Computer delayed filing its annual report 10-K and a report from short-seller Hindenburg Research alleging problems including “accounting manipulation.” The move comes as stock prices have fallen in recent months on speculation about the practice.
Last month, it was reported that the Department of Justice had begun an investigation into the accounting practices of supermicrocomputers in response to the Hindenburg Report.
In response to EY’s resignation, Hindenburg founder Nate Anderson said the company’s resignation letter was “about the strongest wording I’ve seen,” and said EY’s decision would lead to more companies including Nvidia (NVDA) indicated that he may have doubts about doing business with Super Micro Computer in the future.
The supermicrocomputer’s stock fell nearly 30% in early trading on Wednesday to $35.71, but even with Wednesday’s losses it has gained about a quarter of its value since the beginning of the year.
