Seven months after revealing it had misstated its financials for nearly a decade Nutanix (NTNX), an infrastructure software stack provider, continues to correct prior period financial statements. Since August 2014, Nutanix has understated operating expenses in every subsequent reporting period due to an error related to its reporting of software licenses and support.

Rather than correct the error all at once with an out-of-period adjustment, Nutanix elected to correct the errors prospectively as the company issues future financial statements.

In its latest quarterly report, Nutanix revealed it had:

—Understated operating loss by $0.4 million, or 0.5% for the quarter ended October 31, 2022

Previously, Nutanix disclosed it had:

—Understated operating loss by $0.3 million, or 0.38% for the quarter ended April 30, 2022
—Understated operating loss by $1.3 million, or 0.2% in FY21
—Understated operating loss by $1.4 million, or 0.3% in FY22

Despite nearly a decade of misstated financials, two years of revisions are likely all investors are going to get.

Since management considers the errors immaterial, the election to prospectively correct means Nutanix’s misstated financials between 2014-2020 will not be refiled with corrections. Instead, Nutanix will correct its accounts by adjusting retained earnings.

In 2021, a year before Nutanix disclosed a control deficiency related to the misstatements, the company’s auditor, Deloitte & Touche, gave a thumbs-up regarding the effectiveness of Nutanix’s internal control over financial reporting.

Without elaborating, Nutanix blamed the years of misstatements— and its inability to detect trouble for nearly a decade— on non-compliance and unethical behavior:

“...we determined that our controls were not designed and operating effectively to provide the information necessary for our risk assessment process to identify non-compliant use of third-party software as a risk of material misstatement in our financial reporting and we did not effectively reinforce the importance of raising concerns about perceived unethical conduct in a timely manner.”

Though Nutanix says progress has been made, the company says the material weakness has not been fully remediated as of October 31, 2023.

In April 2022, a year before investors were told of the misstatements, Nutanix CFO Duston M. Williams resigned.

Williams received $5.6 million in 2022 and a total of $15.2 million in total compensation over the last three years.