Mix cornstarch, flour, egg and water in a large bowl. Toss the flank steak in the batter and mix until beef strips are coated evenly.
Pour the oil into a large wok. Over high heat put 1/4 of the beef strips into the wok. Quickly separate with metal tongs. Deep fry until the coating is crisp and golden, about 3 minutes. Remove the beef and drain on a paper towel lined plate. Repeat with the remaining beef strips.
To make the sauce, in a bowl, whisk together the soy sauce, rice vinegar, sherry, sugar, sesame oil, and red pepper flakes.
In another pan, add 2 tablespoons of oil, the carrot, jalapeno, red pepper, scallions, ginger, and garlic. Cook over high heat. Pour in the sauce and cook until boiling.
Add a cornstarch slurry to thicken the sauce (1 tbsp cornstarch + 2 tbsp water). Transfer the beef strips back into the pan. Stir-fry until combined.