Section 4 - Matters Related to Accountants and Financial Statements
4.01 Changes in Registrant’s Certifying Accountant
Dismissal of SD Mayer and Associates, LLP
On October 3, 2019, GrowLife, Inc. (the “Company”)
dismissed SD Mayer and Associates, LLP as the Company’s independent registered public accounting firm. The decision to change
accountants was approved by the Company’s Audit Committee.
The SD Mayer reports on the Company’s
consolidated financial statements for the past two fiscal years did not contain an adverse opinion or a disclaimer of opinion and
were not qualified or modified as to uncertainty, audit scope or accounting principles, except that the audit report of SD Mayer
on the Company’s financial statements for fiscal years 2017 and 2018 contained an explanatory paragraph which noted that
there was substantial doubt about the Company’s ability to continue as a going concern.
During the Company’s fiscal years ended
December 31, 2017 and 2018 and through October 3, 2019, (i) there were no disagreements with SD Mayer on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to
SD Mayer’s satisfaction, would have caused SD Mayer to make reference to the subject matter of such disagreements in its
reports on the Company’s consolidated financial statements for such years, and (ii) there were no reportable events as defined
in Item 304(a)(1)(v) of Regulation S-K.
Engagement of BPM LLP
On October 3, 2019 the Company, upon the Audit
Committee’s approval, engaged the services of BPM LLP and as the Company’s new independent registered public accounting
firm to audit the Company’s consolidated financial statements as of December 31, 2019 and for the year then ended. BPM will
be performing reviews of the unaudited consolidated quarterly financial statements to be included in the Company’s quarterly
reports on Form 10-Q going forward.
During each of the Company’s two most
recent fiscal years and through the date of this report, (a) the Company has not engaged BPM as either the principal accountant
to audit the Company’s financial statements, or as an independent accountant to audit a significant subsidiary of the Company
and on whom the principal accountant is expected to express reliance in its report; and (b) the Company or someone on its behalf
did not consult with BPM with respect to (i) either: the application of accounting principles to a specified transaction, either
completed or proposed; or the type of audit opinion that might be rendered on the Company’s financial statements, or (ii)
any other matter that was either the subject of a disagreement or a reportable event as set forth in Items 304(a)(1)(iv) and (v)
of Regulation S-K.