Investing.com – Shares of Super Micro Computer plunged 32% on Tuesday after Ernst & Young LLP (EY) suddenly resigned as the company’s registered public accounting firm.

In a filing with the U.S. Securities and Exchange Commission (SEC), Super Micro said EY submitted its resignation on October 24. At the end of July, EY reportedly raised concerns about governance, transparency and the completeness of communication with management.

EY’s resignation comes during the company’s initial review for the fiscal year ending June 30, 2024.

According to the documents, in July EY raised concerns about the company’s internal controls and governance procedures and indicated that the timely filing of its annual report was at significant risk.

In response, the board initiated an internal review by a special committee and retained Cooley LLP and forensic accounting firm Secretariat Advisors to assist in the investigation.

Despite receiving preliminary updates, the filing said EY stated that the additional information from the review raised serious concerns about the company’s commitment to integrity and the audit committee’s ability to act independently of management.

EY concluded it “could no longer rely on the representations of management and the audit committee” and expressed no willingness to be associated with the financial reports, according to the resignation letter filed with the SEC.

Although Super Micro disagreed with EY’s decision, the company acknowledged the concerns and said it would carefully consider the results of the special committee’s review.

The company has initiated a search for a new independent auditor.

EY’s resignation has shaken investor confidence in a stock that has fallen sharply since its March highs.