The Chemours Company announced the Audit Committee of the Board of Directors has completed its internal review that led to the replacement of its CEO and two other executives.
Chemours is based in Wilmington and has a research center in Newark.
The final report reflected preliminary findings that were released earlier.
The internal review determined that payments of up to approximately $100 million were delayed until the first quarter of 2024, primarily to certain vendors that were originally due to be paid in the fourth quarter of 2023; and collection of up to about $260 million of receivables that were originally not due to be received until the first quarter of 2024 were accelerated into the fourth quarter of 2023.
The practices are believed to be related to meeting compensation targets.
The review determined that actions on a lesser scale were taken in the fourth quarter of 2022, resulting in a delay of up to about $40 million of payments to vendors that were originally due to be paid in the fourth quarter of 2022 until the first quarter of 2023; and the acceleration of the collection of up to approximately $175 million of receivables into the fourth quarter of 2022 that were originally not due to be received until the first quarter of 2023.
The Audit Committee’s internal review determined that three former senior management members lacked transparency with the company’s Board of Directors. The Compensation and Leadership Development Committee of the Company’s board “took the results of the Audit Committee’s internal review into account and exercised full negative discretion in making cash and equity compensation determinations with regard to these former members of senior management.”
Additional details regarding these Compensation and Leadership Development Committee actions will be included in the Company’s Compensation Discussion and Analysis in its proxy statement for its 2024 Annual Meeting.
The material weaknesses did not result in any material misstatements of the company’s financial statements or disclosures but did result in immaterial revisions to the company’s March 31, 2023, June 30, 2023 and September 30, 2023 financial statements.
Chemours is in the process of designing and implementing enhancements to its internal control over financial reporting.
