Tesla, Inc. (NASDAQ:TSLA) is being heavily scrutinized by the Securities and Exchange Commission for using prohibited accounting metrics and sharing it with investors. The SEC stated that Tesla had released its August earnings using “individually tailored” measurements when the company had added back certain costs to revenue.
Four letters went between the SEC and Tesla that were uploaded by the SEC. The documents have been public for a week, dating from mid-September to mid-October. The SEC has labeled the matter resolved without further action required.
Revenue adjustments by Tesla were called “tailored” by the SEC as the adjustments were prohibited from its regulator’s guidelines from May 17th. “Whenever the SEC uses that specific term it’s a clear indication that this specific adjustment should not be used, it’s very strong language,” said vice president of research and CPA, Olga Usvyatsky of Audit Analytics.