{
  "docId": "019dd923-622c-750b-8b99-2f79335352dd",
  "docSlug": "81a891429a42",
  "documentTitle": "Super Micro Computer, Inc. (SMCI)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Spruce Point Capital Management",
  "documentKindSlug": "activist-deck",
  "documentKindLabel": "Activist deck",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2023-01-10 00:00:00",
  "orientation": "landscape",
  "aspectRatio": 1.3333334,
  "pageNumber": 28,
  "pageCount": 36,
  "prevPage": 27,
  "nextPage": 29,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "overcrowded",
  "nDataPoints": 49,
  "notes": "The table compares balance sheet changes vs cash flow statement changes to calculate a discrepancy.",
  "elementsJson": [
    "headline_text",
    "callout_box",
    "quote_block",
    "data_table",
    "footnote"
  ],
  "metadataConfidence": 1,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b99-2f79335352dd/28",
  "deckHref": "/decks/019dd923-622c-750b-8b99-2f79335352dd",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b99-2f79335352dd.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b99-2f79335352dd#slide-28",
  "components": [
    {
      "bbox": {
        "h": 0.11,
        "w": 0.96,
        "x": 0.02,
        "y": 0.315
      },
      "kind": "callout",
      "text": "The errors and certain irregularities primarily related to the timing of recognition of (i) revenue, (ii) expenses related to certain inventory used for engineering and marketing purposes and (iii) expenses related to defective products under warranty not returned by customers. Additionally, errors were identified whereby the Company had derecognized inventory while control over such inventory was retained because the Company was obligated to buy it back.",
      "attrs": null,
      "subkind": "primary",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "acca09f7-42da-4f4a-a347-ddff0f991efb",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "callout",
      "text": "SMCI has a history with problematic accounting for inventories. This formed part of the basis for the restatement of accounts affecting years prior to 2017.",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd953-14d8-75c0-8c8b-5239a29ae7d0",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "metric",
      "text": "Inventory Discrepancy: $63.8",
      "attrs": null,
      "subkind": "primary",
      "toolName": "Quantification",
      "toolSlug": "quantification",
      "confidence": null,
      "componentId": "019dd953-14d8-75c0-8c8b-59cd28ed19a0",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.08,
        "w": 0.96,
        "x": 0.02,
        "y": 0.175
      },
      "kind": "paragraph",
      "text": "SMCI has a history with problematic accounting for inventories. This formed part of the basis for the restatement of accounts affecting years prior to 2017. When analyzing all the pertinent balance sheet accounts today, we find that inventory accounts show the largest deviation between the changes in balance sheet and the reported changes through the cash flow statement.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "fed4cf27-9cae-44ae-97da-c85f9e178f5f",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "quote",
      "text": "The errors and certain irregularities primarily related to the timing of recognition of (i) revenue, (ii) expenses related to certain inventory used for engineering and marketing purposes and (iii) expenses related to defective products under warranty not returned by customers. Additionally, errors were identified whereby the Company had derecognized inventory while control over such inventory was retained because the Company was obligated to buy it back. — SMCI SEC filings",
      "attrs": null,
      "subkind": null,
      "toolName": "Authority citation",
      "toolSlug": "authority-citation",
      "confidence": null,
      "componentId": "019dd953-14d8-75c0-8c8b-551472006edd",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.02,
        "w": 0.3,
        "x": 0.02,
        "y": 0.97
      },
      "kind": "source-note",
      "text": "Source: SMCI SEC filings and Spruce Point Analysis",
      "attrs": null,
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "a3dd05b5-f9fa-4aa8-9b30-a827037a00ae",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.45,
        "w": 0.96,
        "x": 0.02,
        "y": 0.465
      },
      "kind": "table",
      "text": "Analysis of SMCI's Inventory Accounts",
      "attrs": null,
      "subkind": "data",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "e53876a6-a83e-4b56-b89e-1fdeed8ca418",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.04,
        "w": 0.55,
        "x": 0.307,
        "y": 0.06
      },
      "kind": "title",
      "text": "Inventory Accounts Show Large Deviations",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "06eb6e80-7f84-45aa-bc7b-56dbae98b2bc",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [
    {
      "name": "fraud-exposure",
      "slug": null,
      "matchId": "593d6b8e-990e-43f9-9ae9-63c39e227342",
      "evidence": "The slide explicitly links accounting discrepancies to historical restatements and potential irregularities.",
      "confidence": 0.9
    }
  ],
  "arcBeats": [
    {
      "to": 36,
      "from": 21,
      "beatId": "931cc129-be3e-420a-b082-175b903745ac",
      "arcName": "Overcoming the Monster",
      "arcSlug": "overcoming-monster",
      "beatName": "The Victory",
      "beatSlug": "overcoming-monster-the-victory",
      "evidence": "Conclusion and valuation analysis",
      "position": 2,
      "confidence": 0.8,
      "parentBeatName": "Turn",
      "parentBeatSlug": "turn"
    }
  ],
  "loops": [],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}