NEW YORK (AP) — Just over a month after Ernst & Young resigned as a public accounting firm, Super Micro Computer says a review board found no evidence of fraud or misconduct under the server maker’s leadership.
Super Micro is also looking for a new Chief Financial Officer and appointing other executives on the recommendation of the committee, which began its investigation several months ago – after EY raised concerns about issues such as transparency, internal controls over financial reporting and integrity from management while conducting its first audit for the company.
Additional information uncovered during this investigation ultimately led to EY’s resignation as Super Micro’s public accountant in October. Super Micro, which disagreed with EY’s decision, later appointed BDO as its new independent auditor last month.
Super Micro announced that the committee, formed by both the board and external advisors, completed its investigation on Monday. The company said the conclusions EY made in its dismissal were “not supported by the facts” presented in this investigation – and stated there was no evidence of wrongdoing.
As a result, Super Micro does not expect to restate past financial reports. Shares of Super Micro rose more than 20% Monday morning.
In addition to the findings of this review, Super Micro has also outlined plans to appoint new leadership to follow the committee’s recommendations. Super Micro announced that it has started a search for a new CFO, with David Weigand continuing in this role until the board appoints a successor. The company also said it would “accelerate the search” for a Chief Compliance Officer and a General Counsel.
In addition, Super Micro announced that it has appointed Kenneth Cheung, current vice president of finance and corporate controller, as Chief Accounting Officer.
It’s been a tumultuous year for Super Micro – and EY’s resignation wasn’t the first time its accounting practices have been questioned. In August, short selling firm Hindenburg Research released a report alleging widespread accounting manipulation at the company, citing “flanking accounting red flags” and evidence of undisclosed transactions. It also accused Super Micro of rehiring top executives directly involved in a 2018 scandal. Super Micro said at the time it would not comment “on rumors and speculation.”
Following these allegations, The Wall Street Journal and others reported that the Justice Department had begun an investigation into Super Micro, citing people familiar with the matter.
Super Micro is one of the tech companies that recently joined the artificial intelligence wave. In August, Super Micro reported fourth-quarter revenue of $5.31 billion, up more than 143% from the $2.18 billion it reported in the same quarter of 2023.
