Corporate Travel Management (ASX:CTD) will likely face an increase in its risk profile and material client losses due to the recently disclosed errors in its revenue recognition, according to a Thursday Jefferies note.

The investment firm expects that the issues are likely to result in repayments to clients and higher provisions.

Client repayments, weaker working capital, and other cash outflows may create a need for equity raising, the note added.

Jefferies said it is not possible to forecast earnings due to the given uncertainty.

Jefferies said that it moves to Not Rated on Corporate Travel Management and withdraws its price target, but will continue to cover the company.