Flux Power Holdings, Inc. (NASDAQ:FLUX), a manufacturer of electrical equipment with a market capitalization of $29.36 million, has announced a change in its independent accounting firm. The company notified the Securities and Exchange Commission (SEC) on Monday that Baker Tilly US, LLP would not seek re-election as the company's auditor after completing the audit for the fiscal year ended June 30, 2024.
Baker Tilly's (NYSE:TLYS) reports for the fiscal years 2023 and 2022 contained no adverse opinions, and there were no disagreements on accounting practices or financial disclosures during this period.
However, the company did disclose material weaknesses in internal control over financial reporting in its recent SEC filings. According to InvestingPro analysis, the company faces challenges with a negative EBITDA of $4.35 million and potential difficulties making interest payments on debt. InvestingPro's comprehensive analysis reveals 13 additional key insights about FLUX's financial health.
Following Baker Tilly's notification, Flux Power's Audit Committee appointed Haskell & White LLP as the new independent registered public accounting firm for the fiscal year ending June 30, 2025. This appointment is contingent on Haskell & White completing standard client acceptance procedures and signing an engagement letter.
The transition of accountants comes at a time when Flux Power is addressing internal control issues and preparing for the upcoming fiscal year. The company has provided Baker Tilly with the disclosures under Item 4.01 and has received a letter from Baker Tilly, dated January 8, 2025, confirming their agreement with the statements made in the SEC filing.
This move does not imply any disputes with the outgoing firm, as the company's board or audit committee did not recommend or approve Baker Tilly's decision not to stand for re-election. The changes in the company's certifying accountant are detailed in the SEC Form 8-K filed on January 8, 2025.
In other recent news, Flux Power Holdings announced the appointment of Kelly Frey as its new Chief Revenue Officer. Frey brings extensive experience in sales and marketing leadership, particularly in the battery and energy storage sectors. This change in leadership comes amidst Flux Power's efforts to advance business growth, with a strong pipeline of orders and new customer opportunities.
Flux Power is also undergoing financial restatements due to noncash inventory write-downs and related adjustments, totaling approximately $4.9 million. This process spans multiple quarters over several years, including the fiscal year 2023 and interim periods of fiscal year 2024. The company's recent revenue was reported at $63.85 million, with a net loss of $2.6 million in the third quarter of fiscal year 2024.
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