In a bowl, combine chicken slices with sherry, ginger, garlic, and 2 tsp cornstarch. Mix well and refrigerate for 30 minutes.
In a separate bowl, whisk together chicken broth, soy sauce, hoisin sauce, rice vinegar, brown sugar, and 2½ tsp cornstarch until smooth. Set aside.
Heat 1 tsp oil in a large skillet over medium-high heat. Add half the marinated chicken and cook until fully cooked through, about 5 minutes. Remove and set aside.
Heat remaining 1 tsp oil and cook the remaining chicken for another 5 minutes until cooked through.
Return all chicken to the skillet and add the sauce mixture. Simmer while stirring until sauce thickens and becomes glossy, about 1 minute.
Remove from heat and stir in toasted cashews, sliced scallions, and red pepper flakes.
Serve immediately over cooked rice.