Harvest Capital Credit Corporation (NASDAQ:HCAP) Files An 8-K Changes in Registrant’s Certifying Accountant
Changes in Registrant’s Certifying Accountant.
Previous Independent Registered Public Accounting Firm
On March 18, 2019, the Audit Committee (the “Audit Committee”) of the Board of Directors of Harvest Capital Credit Corporation (the “Company”) approved the decision to change independent registered public accounting firms. On March 18, 2019, the Company notified PricewaterhouseCoopers LLP (“PwC”) that they are dismissed as the Company’s independent registered public accounting firm, effective as of that date.
The reports of PwC on the Company’s consolidated financial statements for the fiscal years ended December 31, 2018 and 2017 did not contain an adverse opinion or a disclaimer of opinion, and they were not qualified or modified as to uncertainty, audit scope, or accounting principles.
During the fiscal years ended December 31, 2018 and 2017, and during the subsequent interim period through March 18, 2019, there were (1) no disagreements with PwC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of PwC, would have caused it to make reference thereto in their reports on the financial statements, and (2) no “reportable events” as that term is defined in Item 304(a)(1)(v) of Regulation S-K, except that, as disclosed in Item 9A to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017, management concluded that the Company’s disclosure controls and procedures were not effective as of December 31, 2017 as a result of a material weakness in internal control over financial reporting related to an ineffective control environment as material financial information from one of our portfolio companies was not promptly supplied to our financial staff by certain senior investment professionals. Beginning in the first quarter of 2018, the Company adopted a corrective action plan and added new and/or enhanced existing controls. As a result of the enhanced controls implemented during the first three quarters of 2018, management concluded that the material weakness was remediated as of September 30, 2018 and that its disclosure controls and procedures were effective as of September 30, 2018 and December 31, 2018.
The Audit Committee previously discussed the above-described “reportable event” with PwC, and the Company has authorized PwC to respond fully to any inquiries from the successor independent registered public accounting firm.
The Company has provided PwC with a copy of the disclosures required by Item 304(a) of Regulation S-K contained in this Current Report on Form 8-K (this “Form 8-K”) and requested that PwC furnish the Company with a letter addressed to the U.S. Securities and Exchange Commission (the “SEC”) stating whether or not it agrees with the statements made herein. A copy of PwC’s letter dated March 22, 2019 is filed as Exhibit 16.1 to this Form 8-K.
New Independent Registered Public Accounting Firm
On March 21, 2019, the Company engaged RSM US LLP (“RSM”) as its new independent registered public accounting firm, subject to completion of RSM’s client acceptance process. The decision to engage RSM as the Company’s independent registered public accounting firm was approved by the Company’s Audit Committee. During the years ended December 31, 2018 and 2017, and during the subsequent interim period through March 18, 2019, neither the Company nor anyone on its behalf has consulted with RSM regarding either: (1) 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 consolidated financial statements, and no written report or oral advice was provided that RSM concluded was an important factor considered by the Company in reaching a decision as to the accounting, auditing or financial reporting issue; or (2) any matter that was either the subject of a “disagreement,” as that term is defined in Item 304(a)(1)(iv) of Regulation S-K or a “reportable event,” as that term is defined in Item 304 (a)(1)(v) of Regulation S-K, except that the Company engaged RSM in the second quarter of 2018 to provide consulting and compliance services in preparation for complying with the full requirements of Section 404 of the Sarbanes-Oxley Act, and those services were completed upon conclusion of the audit for fiscal year 2018.
Financial Statements and Exhibits.
Harvest Capital Credit Corp Exhibit
EX-16.1 2 ex_138602.htm EXHIBIT 16.1 ex_138602.htm Exhibit 16.1 March 22,…
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About Harvest Capital Credit Corporation (NASDAQ:HCAP)
Harvest Capital Credit Corporation is an externally managed, closed-end, non-diversified management investment company. The Company operates as a business development company and provides customized financing solutions for small to mid-sized companies. Its investment objective is to generate both current income and capital appreciation by making direct investments in the form of subordinated debt, senior debt, and to a lesser extent, minority equity investments in privately-held the United States small to mid-sized companies. Its investment portfolio includes over 56.8% of senior secured term loans, 40.8% of junior secured term loans, 1.3% of equity investments and 1.1% of collateralized loan obligation (CLO) equity at fair value. It may also invest in other investments, such as loans to larger, publicly-traded companies, high-yield bonds and distressed debt securities. It may also invest in debt and equity securities issued by CLO funds. HCAP Advisors LLC is its investment adviser.