Item 4.01
Changes in Registrant’s Certifying Accountant.
On December 3
0, 2016, the Company received notice from its independent registered public accounting firm, GHP Horwath, P.C. (“GHP”), that GHP has chosen not to stand for re-appointment as the Company’s auditor, and effective as of December 30, 2016, the client-auditor relationship between the Company and GHP Horwath, P.C. shall cease. The resignation of GHP was not recommended by the Company’s audit committee nor was the audit committee’s approval required.
GHP has informed us that its employees will join another independent registered public accounting firm effective January 1, 2017. The Company is currently evaluating retention of another independent registered public accounting firm, which will be subject to the approval of the Company
’s audit committee.
We had engaged GHP as our independent registered public accounting firm on October 29, 2015, following the dismissal of our prior independent account, Sadler, Gibb & Associates, LLC (“Sadler Gibb”) on October 26, 2015, as disclosed in our Form 8-K filed with the Commission on November 5, 2015 (the “Sadler Gibb 8-K”). The Sadler Gibb 8-K is incorporated herein by reference.
The audit report of GHP on the Company
’s financial statements for the fiscal year ended December 31, 2015 contained no adverse opinion or disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principles. For related disclosure relating to the fiscal year ended December 31, 2014, refer to the Sadler Gibb 8-K.
From October 29, 2015, and subsequently through December 3
0, 2016, there were no “disagreements” (as described in Item 304(a)(1)(iv) of Regulation S-K) with GHP on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of GHP, would have caused it to make reference in connection with its opinion to the subject matter of the disagreement.
From October 29, 2015 and subsequently through December 3
0, 2016, there was one “reportable event” within the meaning of Item 304(a)(1)(v) of Regulation S-K, relating to disclosure of material weaknesses in the Company’s internal control over financial reporting. As previously reported in the Company’s Form 10-K filed March 30, 2016, the following control deficiency was identified that represents a material weakness as of December 31, 2015; inadequate segregation of duties due to a limited number of employees among whom duties can be allocated
. The lack of segregation of duties is due to the limited resources of the Company. For related disclosure relating to the fiscal year ended December 31, 2014, and the subsequent period through October 26, 2015, refer to the Sadler Gibb 8-K.
In accordance with Item 304(a)(3) of Regulation S-K, we furnished GHP with a copy of this Form 8-K, providing GHP with the opportunity to furnish the Company with a letter addressed to the Commission stating whether it agrees with the statements made by the Company herein in response to Item 304(a) of Regulation S-K as the same pertain to GHP and, if not, stating the respect in which it does not agree. A copy of GHP
’s response is filed as Exhibit 16.1 to this Report.