WeWorkย has revealed that it mustย edit its financial statementsย for three quarters, a floundering start for the newly public company.ย ย ย
According to the company, it had misclassified some of its public shares, whichย wereย previously referred to as permanent equity. However, theyย were meant to be classified asย temporary equity.ย
As the company prepared its financial statements through September 30,ย WeWorkย reevaluated an accounting classification of Class A common stock that were issued as part of units sold in the IPO byย BowXย Acquisition Corp. This led the firm toย find thatย the shares should not have been classified as โpermanent equity.โย
The coworking firm also said its management foundย โaย material weakness in internal control over financial reporting relating to the interpretation and accountingโ for a portion of its shares.ย
The news was announced in a filing with the Securities and Exchange Commission earlier this week and just around a month after the company went public.ย
WeWorkย has worked to remedy its reputation over the last several years, but this misstatement is a huge blunder in these efforts.ย
