: SEC penalizes DXC Technology following accusations of ‘misleading’ disclosures


IT services provider DXC Technology Co. DXC, +0.94% agreed to pay an $8 million penalty and tighten up its financial reporting protocols after the Securities and Exchange Commission accused the company of making “misleading disclosures” related to its financials from 2018 to 2020, the agency said on Tuesday. The company neither admitted nor denied wrongdoing as part of the agreement. The SEC accused DXC of fattening its non-GAAP net income — or that measured by standards that aren’t generally accepted accounting principles — by “misclassifying tens of millions of dollars of expenses as non-GAAP adjustments for so-called transaction, separation, and integration-related (TSI) costs and improperly excluding them from its non-GAAP earnings.” By misclassifying those costs, the SEC said DXC “materially overstated its non-GAAP net income in three fiscal quarters.” The commission found that DXC violated anti-fraud and financial reporting laws. Shares of DXC fell 0.6% after hours on Tuesday.

This article was originally published by Marketwatch.com. Read the original article here.

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