Item 4.01. Changes in Certifying Accountant.
For accounting purposes, the merger (the “Merger”) of Aadi Bioscience, Inc. (f/k/a Aerpio Pharmaceuticals, Inc., herein after referred to as the “Company”) with Aadi Subsidiary, Inc. (f/k/a Aadi Bioscience, Inc., herein after referred to as “Old Aadi”), as described in the Company’s Current Reports on Form 8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on May 17, 2021 and August 27, 2021, respectively, is treated as a reverse acquisition and, as such, the historical financial statements of the accounting acquirer, Old Aadi, which have been audited by BDO USA, LLP (“BDO”), will become the historical financial statements of the Company.
On September 9, 2021, upon the determination of the audit committee (the “Audit Committee”) of the Board of Directors (the “Board”) of the Company that BDO will continue as the successor auditor of the Company, Ernst & Young LLP (“EY”), who served as the Company’s independent registered public accounting firm prior to the Merger, was informed that it would be dismissed as the Company’s independent registered public accounting firm. EY’s dismissal, which was approved by the Audit Committee, was not due to any reason related to the Company’s reporting or accounting operations, policies, or procedures.
The report of EY on the Company’s consolidated financial statements for the years ended December 31, 2020 and 2019 did not contain an adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles. During the years ended December 31, 2020 and 2019 and in the subsequent period between December 31, 2020 and the date of EY’s dismissal, there were no: (1) disagreements (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) between the Company and EY on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreement if not resolved to the satisfaction of EY would have caused EY to make reference thereto in its reports on the consolidated financial statements for such years, or (2) reportable events (as described in Item 304(a)(1)(v) of Regulation S-K).
We delivered a copy of this Current Report on Form 8-K to EY and requested that a letter addressed to the SEC stating whether or not it agrees with the statements made in response to this Item and, if not, stating the respects in which it does not agree. EY responded with a letter dated September 9, 2021, a copy of which is annexed hereto as Exhibit 16.1, stating that EY agrees with the statements set forth above.
On September 9, 2021, the Audit Committee also approved the engagement of BDO as the Company’s independent registered public accounting firm to audit the Company’s consolidated financial statements for the year ending December 31, 2021. As discussed above, BDO previously served as the independent auditors for Old Aadi, which was acquired by the Company on August 26, 2021 pursuant to the Merger.
During the years ended December 31, 2020 and 2019 and in the subsequent period between December 31, 2020 and the date of BDO’s engagement, neither the Company, nor anyone on the Company’s behalf, consulted with BDO regarding either (i) the application of accounting principles to a specified transaction, completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements, and neither a written report nor oral advice was provided to the Company that BDO concluded was an important factor considered by the Company in reaching a decision as to any accounting, auditing, or financial reporting issue or (ii) any matter that was either the subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) or a reportable event (as described in Item 304(a)(1)(v) of Regulation S-K).