"According to a Monday SEC filing, the company's audit committee is examining its cash management practices, related disclosures (including how it presents adjusted free cash flow), the effectiveness of internal control over financial reporting, and related matters in response to the SEC's voluntary information requests. This review is delaying completion of the quarterly report and the company's internal control assessment, but at this time, the company does not expect any impact on its consolidated financial statements."
"This review is delaying completion of the quarterly report and the company's internal control assessment, but at this time, the company does not expect any impact on its consolidated financial statements. CFO David Wyshner and General Counsel Edward Sebold have departed their positions, effective immediately, and Harsh Chugh has been appointed interim CFO. In addition, Bhavna Doegar was appointed interim corporate controller, and Mark Ringes, interim general counsel. The stock price was down more than 50% at the close of trading on Monday."
"The news follows Kyndryl's most recent earnings call, where the company highlighted improved contract signings and adjusted free cash flow as evidence of turnaround progress. That backdrop could help explain the sharp selloff: investor concern appears less about business performance and more about governance, as questions around cash management, internal controls, and the sudden exits of executives. Investors would understandably be nervous when both the CFO and the general counsel depart, according to Shivaram Rajgopal, an accounting professor at Columbia Business School."
Kyndryl's audit committee is reviewing cash management practices, related disclosures including adjusted free cash flow presentation, and the effectiveness of internal control over financial reporting after voluntary information requests from the SEC. The review is delaying completion of the quarterly report and the company's internal control assessment, although the company currently does not expect an impact on consolidated financial statements. CFO David Wyshner and General Counsel Edward Sebold departed immediately, and Harsh Chugh, Bhavna Doegar, and Mark Ringes were named interim CFO, corporate controller, and general counsel, respectively. The stock fell more than 50% on the news. Investor concern centers on governance and internal controls rather than operational performance.
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