Darktrace hires EY to review financial processes after short seller report
Darktrace hires EY to review financial processes after short seller report :- British cybersecurity company Darktrace has hired professional services firm EY to review its financial processes in response to a critical report from a short seller. The report, published earlier this month, alleged that Darktrace’s financial statements were misleading and that the company’s growth prospects were overstated.
In response, Darktrace issued a statement denying the allegations and stating that it was “fully confident in its financial statements and disclosures.” However, the company also announced that it had engaged EY to conduct an independent review of its financial processes, in order to provide “additional assurance” to investors.
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The decision to hire EY is seen as a significant move by Darktrace, which went public on the London Stock Exchange in April 2021 and has a market capitalization of around £5.5 billion. The company’s shares have fallen by around 20% since the release of the short seller report.
Darktrace’s response to the report is similar to those taken by other companies in similar situations. When faced with allegations of financial irregularities or misconduct, companies often engage external auditors or investigators to conduct a review and provide reassurance to investors.
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The outcome of the EY review will be closely watched by investors and analysts, and may have implications for Darktrace’s future growth prospects and share price performance.
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