CI&T Inc. announced restatement of unaudited consolidated earnings results for the year ended December 31, 2022. For the year, the company restated net profit for the year as BRL 95,710,000 against previously issued as BRL 125,916,000. In connection with the preparation of its financial statements for the year ended December 31, 2023, the company, in consultation with its independent registered public accounting firm, KPMG Auditores Independentes Ltda., identified certain non-cash accounting errors related to deferred income accounting for tax-deductible goodwill, as required under IFRS ?

International Financial Reporting Standard. As a result, the audit committee of the board of directors of the Company, after discussions with management and consultation with KPMG, on March 4, 2024, concluded that the Company?s audited consolidated financial statements as of and for the year ended December 31, 2022, included in its annual report on Form 20-F for the year ended December 31, 2022 filed with the United States Securities and Exchange Commission on March 28, 2023, and the Company?s unaudited condensed consolidated interim financial statements as of and for the periods ended March 31, 2023, June 30, 2023 and September 30, 2023, each previously furnished to the SEC on a current report on Form 6-K, should no longer be relied upon (collectively, the Non-Reliance Periods). Similarly, any previously furnished reports, such as earnings releases, investor presentations or other communications describing the Company?s consolidated audited financial statements, and condensed consolidated interim financial statements and other related financial information covering the Non-Reliance Periods should no longer be relied upon.

The corrective adjustments required in accordance with IFRS are expected to be non-cash in nature and will not increase the amount of income tax to be paid in the future. The corrective adjustments are not expected to impact net revenue, operating profit before financial income and tax, or any other line of statement of profit and loss that is above profit before income tax for the Non-Reliance Periods. The corrective adjustments are not expected to impact Adjusted EBITDA for the Non-Reliance Periods or cash and cash equivalents at the end of the Non-Reliance Periods.

The Company intends to file its restated financial statements as of and for the year ended December 31, 2022 together with its audited consolidated financial statements as of and for the year ended December 31, 2023, in the 2023 Form 20-F. The Company believes this will allow readers to easily review all pertinent data in a single document. The Company intends to file the 2023 Form 20-F as soon as possible (and in any case, before April 30, 2024) and, therefore, does not plan to amend its 2022 Form 20-F. The Company also intends to furnish to the SEC, as soon as possible, a current report on Form 6-K showing the impact of the restatement of its unaudited condensed consolidated interim financial statements as of and for the periods ended March 31, 2023, June 30, 2023 and September 30, 2023. In 2021 and 2022, the Company completed business combinations, which resulted in book goodwill and income tax deductible goodwill as part of the acquisition accounting.

Since January 2022, the Company has been deducting the goodwill from the acquisitions for income tax purposes in accordance with the Brazilian income tax regulations, reducing current income tax expense, income tax liability, and income tax paid in cash. During this period, the Company considered the financial statement impacts of tax-deductible goodwill amortization arising from these acquisitions as a permanent difference in the determination of its income tax provision, instead of a temporary difference between tax basis goodwill and financial statement basis goodwill, as required under IFRS. As a result, the income tax expense was BRL 40.5 million understated in year ended December 31, 2022 and by BRL 30.9 million for the nine months ended September 30, 2023.

The amortization of the tax goodwill should have been recognized as a deferred income tax liability and deferred tax expense, due to changes between the tax basis and the financial statement basis of goodwill. In addition, the amortization of the identifiable intangible assets recognized as part of the Dextra business combination was considered nondeductible in the income tax calculation, which is not consistent with Brazilian income tax regulations. As a result, the income tax expense was overstated by BRL 10.3 million for the year ended December 31, 2022 and by BRL 4.1 million for the nine months ended September 30, 2023.

The Company estimates the net impact of these adjustments will increase Income Tax Expense by approximately BRL 30.2 million for the year ended December 31, 2022 and BRL 26.7 million in the nine months ended September 30, 2023. As a result, Net Income should be reduced by approximately BRL 30.2 million in 2022 and BRL 26.7 million in the nine months ended September 30,2023. The Company also expects to reflect certain classification corrections to non-derivatives and loans and borrowings as part of the restatement to the financial statements.

The reclassifications will reduce current assets in BRL 19.6 million, reduce current liabilities in BRL 30.4 million and increase non-current liabilities in BRL 10.8 million. These reclassifications have no impact on statements of profit or loss, comprehensive income, changes in equity and cash flows.