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Why Triterras Stock Soared Today

What happened

Shares of Triterras (NASDAQ: TRIT) have jumped today, up by 11% as of 2:50 p.m. EST, after the company said it was opening an investigation into recent allegations made by short-sellers. The stock has been extremely volatile in recent weeks after Phase 2 Partners released a bearish report.

So what

Triterras, a fintech company that operates a blockchain-based trading platform called Kratos, said that the Audit Committee of the board of directors has initiated an independent investigation into the allegations. The committee is currently finding an independent third-party legal counsel to conduct the inquiry, and Triterras management is fully supportive of the investigation since it is confident that the review will "set the record straight regarding the false and/or incomplete information included in the recent short report."

Image source: Getty Images.

Additionally, Triterras said it would be switching accounting firms, replacing KPMG, one of the big four accounting firms. The company says that it has been considering changing its accountants for "various" reasons, including to further distance its operations from a related party company Atanium, which was previously known as Rhodium Resources. Rhodium fell into financial distress last month, which caused concerns around Triterras since both companies were founded by Srinivas Koneru.

Now what

Triterras has not yet selected a new accounting firm but is in discussions to find a replacement. The company also notes that KPMG did not issue any adverse opinions regarding the company's financial statements for fiscal 2019 and fiscal 2020.

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Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.


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