SunEdison identifies 'weaknesses' in accounting

Renewable power firm SunEdison warned Wednesday that it had discovered problems in its accounting processes that required it to delay its annual stockholders report.

The news dealt a sharp blow to the company's stock (SUNE), which fell 15.5% in pre-market trading before recovering somewhat. Shares were down 6.2% at 12:13 p.m. but rallied later to close unchanged at $2.08.

SunEdison said in a statement that it had identified “material weaknesses in its internal controls over financial reporting.”

The Maryland Heights, Mo.-based company blamed the issue primarily on “deficient information technology controls in connection with newly implemented systems.”

A SunEdison spokesman declined to elaborate on the issue.

The disclosure comes about two weeks after the company said the Audit Committee of its Board had launched an investigation into the “accuracy of the company’s anticipated financial position.”

It also came after the ailing company's proposed acquisition of rooftop solar company Vivint collapsed earlier this month when SunEdison couldn't line up the financing necessary to complete the deal.

Taken together, the issues have battered investor confidence in SunEdison, which develops, installs and operates alternative energy plants.

Concurrently, one of the company's subsidiaries, TerraForm Power (TERP), also said its annual report would be delayed. The company said it relies heavily on SunEdison's bookkeeping to ensure timely financial reports. Its shares closed 7.9% lower Wednesday at $9.72.

TerraForm, which purchases power plants from SunEdison, also warned that Nasdaq officials notified the company that the delay required it to submit a plan detailing how it will become compliant with reporting regulations.

Follow Paste BN reporter Nathan Bomey on Twitter @NathanBomey.