Xencor to restate 2023 annual and 2024 quarterly financials over accounting errors
Xencor's Audit Committee concluded on February 11, 2025 that its 2023 annual report and its three 2024 quarterly reports can no longer be relied upon. The errors involve accounting for a November 2023 royalty transaction with OMERS Life Sciences and the treatment of research and development and state tax items. The company identified material weaknesses in internal control over financial reporting and expects to file amended reports before its 2024 Form 10-K.
Key points
- The royalty deal with OMERS Life Sciences should be treated as debt, not deferred income; deferred income was overstated by $156.9 million and debt understated by $168.5 million for 2023.
- Cash flow from operating activities for 2023 was overstated by $163.0 million, with financing cash flow understated by the same amount; the filing says there is no impact on cash and marketable debt securities.
- Tax errors add an uncertain tax position of $5.6 million for 2023 and state income tax expense understated by approximately $2.2 million, excluding interest and penalties.
- RSM US LLP recalled its February 28, 2024 audit reports, and the company plans to file amendments to each prior filing.
The filing
Written by AI on Nov 8, 2026, 1:49 AM ET, from this filing only. Written later: this filing was briefed after the fact, when past filings were added to the site, so the brief may be read with hindsight; the filing itself is the record of what was known on February 13, 2025.
Briefs are written by AI from the filing text and can contain mistakes — open the filing before acting on anything. Impact (1-5) and tone are the AI's reading of the filing for shareholders, not a price forecast. Not investment advice.