Hydrogen fuel-cell company Plug Power has agreed to settle charges brought against it by the U.S. Securities and Exchange Commission (SEC) regarding violations of financial reporting rules and failures in accounting and controls. The settlement amount totals $1.25 million, which includes penalties for restating results from previous years.
According to the SEC, between 2018 and the third quarter of 2020, Plug Power failed to properly account for its right-of-use assets and lease liabilities in certain sale-leaseback transactions. The commission also noted that the company did not correctly classify or present certain costs related to research and development activities as part of its cost of revenue.
In response to these findings, Plug Power announced in 2021 that it would be restating its annual reports for 2018 and 2019, as well as its quarterly reports for 2019 and 2020.
As part of the settlement, Plug Power has committed to addressing the material weaknesses in its financial-reporting controls and other disclosure controls. The company has not admitted to or denied the charges but has agreed to make the necessary improvements. Failure to do so will result in an additional penalty of $5 million, referred to as a "springing penalty," according to the SEC.
Andy Marsh, the chief executive of Plug Power, stated, "Plug has diligently and fully cooperated with the SEC throughout the process and took prompt corrective measures and extensive remedial actions and steps to improve and enhance our policies, procedures, and internal controls over financial reporting."
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