Concerns over the accuracy of the Perion Network's financial reporting have prompted New York-based hedge fund Spruce Point Capital to establish a new short position in the Israel-based advertising technology firm, according to a report by Reuters.

The report cites Spruce Point Capital as saying that given its "extreme dependency" on a Microsoft Corp search partnership that is due to come to an end next year, Perion's shares could fall by as much as 40% in the long-term.

News of Spruce Point's new bet against the business saw Perion's stock price fall to a near four-month low before recovering some of that loss. Perion's shares are up over 20% so far this year, having outperformed the broader market for at least the past five years, according to Reuters.