Prospect Capital stock dips after disclosing expected material weakness

Aug. 30, 2022 9:37 AM ETProspect Capital Corporation (PSEC)By: Liz Kiesche, SA News Editor48 Comments

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  • Prospect Capital (NASDAQ:PSEC) stock is dropping 3.2% in early Tuesday trading after the business development company said it expects to report a material weakness in its internal control over financial reporting when it and its accounting firm have completed its fiscal 2022 assessment and audit.
  • The material weakness relates to management review controls over the valuation of collateralized loan obligations, including review procedures over the completeness and accuracy of underlying data used in performing those review procedures.
  • The company was unable to file its annual report on form 10-K for the fiscal year ended June 30, 2022 because it and its accounting firm needed more time to complete their audit and assessment of internal control over financial reporting.
  • "Additionally, we expect to report a material weakness relating to our control environment and monitoring activities, specifically, with respect to evaluating internal control deficiencies in a timely manner," it said.
  • Prospect Capital (PSEC) said the material weaknesses will not require a Q4 2022 adjustment or materially impact its consolidated financial statement for any prior annual or interim periods.
  • Previously (Aug. 29), Prospect (PSEC) Q4 net investment income tops consensus, rises from Q3

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