8-Kfiled March 8, 2023, 6:59 PM ETticker XOSCIK 0001819493
other materialconfidence highsentiment negativemateriality 0.80
Xos, Inc. (XOS): auditor change — Xos restates Q1-Q3 2022 financials due to inventory and derivative accounting errors
Xos, Inc.
Cost of goods sold understated by $2.8M for three, six, and nine months ended March/June/Sept 2022 due to inventory count errors.
Duplicate inventory receipts and prepaid inventory errors caused line-item misstatements (e.g., prepaid expenses overstated by up to $4.4M).
Derivative liability on convertible debentures not bifurcated; convertible debt net overstated by $7.1M and derivative liabilities understated by $3.8M as of Sept 30, 2022.
Material weakness identified in internal control over financial reporting related to inventory management; disclosure controls and procedures ineffective.
No expected impact on reported cash balances or liquidity; company plans to file Form 10-Q/A for each restated quarter.
Xos, Inc. reported that prior financial statements should not be relied upon.
Action
non reliance
Exact text from the filing
On March 8, 2023, the audit committee (the "Audit Committee") of the Board of Directors of Xos, Inc. (the "Company"), after discussion with the Company's management, concluded that the Company's previously issued unaudited condensed consolidated financial statements as of and for the quarters ended March 31, 2022, June 30, 2022 and September 30, 2022 (collectively, the "Restated Financials"), each as previously filed with the Securities and Exchange Commission (the "SEC"), should no longer be relied upon and should be restated
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