Pacific Coast Oil Trust (NYSE:ROYT) Files An 8-K Changes in Registrant’s Certifying Accountant
Item 4.01 Changes in Registrants Certifying Accountant.
On October 4, 2019, PricewaterhouseCoopers LLP (PwC) resigned as the independent registered public accounting firm of Pacific Coast Oil Trust (the Trust).
The reports of PwC on the Trusts financial statements (which were prepared in conformity with the modified cash basis of accounting) for the fiscal years ended December 31, 2017 and December 31, 2018 contained no adverse opinions or disclaimers of opinions and were not qualified or modified as to uncertainty, audit scope, or accounting principles.
The Trust has no board of directors or audit committee or similar committee of a board of directors. The Bank of New York Mellon Trust Company, N.A., as trustee of the Trust (the Trustee), did not recommend or approve PwCs resignation.
During the fiscal years ended December 31, 2017 and December 31, 2018, and the subsequent interim period through October 4, 2019, there were (i) no disagreements between the Trust and PwC 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 PwC, would have caused PwC to make reference to the subject matter of the disagreement in PwCs reports on the Trusts financial statements for such years, and (ii) no reportable events as that term is defined in Item 304(a)(1)(v) of Regulation S-K, except that PwC advised the Trust that information had come to PwCs attention that causes PwC to be unwilling to be associated with the Trusts financial statements in the future. As previously disclosed, NewBridge Resources Pacific LLC, which is wholly owned by NewBridge Resources Group LLC, which is owned 50% by Scott Y. Wood and 50% by K4 Oil LLC, recently acquired Pacific Coast Energy Holdings LLC (PCEH). PCEH is the sole member of the general partner of Pacific Coast Energy Company, LP (PCEC), which is the sponsor of the Trust. PCEC, which owns the oil and natural gas properties in which the Trust owns certain net profits and royalty interests conveyed by PCEC, provides to the Trust such accounting, bookkeeping and informational services and other services necessary for the preparation of the reports the Trust is required to file with the Securities and Exchange Commission (the SEC). PwC has informed the Trustee that its resignation is the result of the change of ownership of PCEH.
The Trust has not yet identified a successor independent registered public accounting firm. The Trustee has discussed the matter described above with PwC, and the Trustee has authorized PwC to respond fully to the inquiries of the successor independent registered public accounting firm concerning the matter. The Trust anticipates that the Trust may be unable to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 on a timely basis.
The Trust also anticipates that a successor independent registered public accounting firm will be required to re-audit all periods necessary for the inclusion of financial statements in the Trusts Annual Report on Form 10-K for the year ending December 31, 2019, and the Trust will bear the additional costs of re-auditing these periods.
The Trust provided PwC with a copy of the disclosures it is making in this Current Report on Form 8-K (the Report) prior to the time the Report was filed with the SEC. The Trust requested that PwC furnish a letter addressed to the SEC stating whether or not it agrees with the statements made herein. A copy of PwCs letter, dated October 10, 2019, is attached hereto as Exhibit 16.1.
Item 9.01. Financial Statements and Exhibits.