Accounting fraud? Tesla skimps on warranty costs to inflate its profits, critics allege

Over the last four months, Tesla’s shares have nearly tripled in value after the company’s quarterly earnings twice beat Wall Street’s expectations. But some Tesla critics allege that those profits were the result of misleading accounting.

They claim that Tesla has inflated its profits by artificially lowering its “warranty reserve,” the money it sets aside to pay for future repairs to cars covered by warranties.