StarTek, Inc. (NYSE:SRT) Files An 8-K Changes in Registrant’s Certifying Accountant
Item 4.01Changes in Registrant’s Certifying Accountant.
(a) Introductory Note
As previously disclosed, StarTek, Inc. (“StarTek” or the “Company”), is a party to that certain Transaction Agreement, dated March 14, 2018, as amended on July 3, 2018 (the “Transaction Agreement”), by and among the Company, CSP Alpha Holdings Parent Pte Ltd, a Singapore private limited company (the “Aegis Stockholder”) and CSP Alpha Midco Pte Ltd, a Singapore private limited company (“Aegis”), to which the Company agreed to acquire all of the outstanding capital stock of Aegis from the Aegis Stockholder, in exchange for the issuance of 20,600,000 shares of the common stock of the Company to the Aegis Stockholder, and in addition, the Aegis Stockholder agreed to purchase additional newly issued shares of our common stock at a price of $12.00 per share for an additional payment of $2,000,000. The transactions contemplated by the Transaction Agreement are referred to herein as the “Aegis Transactions.”
For accounting purposes, the Aegis Transactions are treated as a reverse acquisition and Aegis is considered the accounting acquirer. Aegis previously followed a March 31 fiscal year end. Upon filing of the 8-K/A on October 5, 2018, the fiscal year end of the Company was changed back to December 31 by the Board of Directors (the “Board”) of the Company. Consequently, the fiscal year ending December 31, 2018 comprises of 9-months of operations from April 1, 2018 to December 31, 2018. The previous fiscal year of Aegis (and the Company following the Aegis Transactions) comprises of 12-months of operations from April 1, 2017 to March 31, 2018.
(b) Previous independent registered public accounting firm.
On March 18, 2019, the Audit Committee (the “Audit Committee”) of the Board determined to change StarTek’s independent accounting firm and notified Plante & Moran PLLC, StarTek’s current independent registered public accounting firm, of its dismissal.
The reports of Plante & Moran PLLC on our consolidated financial statements as of and for the nine month transition period ended December 31, 2018 contained no adverse opinion or disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles.
During the two most recent audit periods ended December 31, 2018 and December 31, 2017 (which period is different from the March 31 fiscal year end of Aegis, as Plante & Moran PLLC was not the independent accounting firm of Aegis at such time and the fiscal year end of the Company prior to the Aegis Transactions was December 31) and through March 18, 2019, the Company has not had any disagreements (as that term is defined in Item 304(a)(1)(iv) of Regulation S-K and related instructions) with Plante & Moran PLLC on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to Plante & Moran PLLC’s satisfaction, would have caused them to make reference thereto in their reports on the Company’s financial statements for such periods. During the two most recent audit periods ended December 31, 2018 and December 31, 2017 (which period is different from the March 31 fiscal year end of Aegis, as Plante & Moran PLLC was not the independent accounting firm of Aegis at such time and the fiscal year end of the Company prior to the Aegis Transactions was December 31) and through March 18, 2019, there were no reportable events, as defined in Item 304(a)(1)(v) of Regulation S-K, except for the material weakness identified in the Company’s internal control over financial reporting related to the design and operation of control activities which was disclosed in Management’s Report on Internal Control over Financial Reporting in Item 9A of the 2018 Form 10-KT filed by the Company on March 14, 2019.
The Company provided Plante & Moran PLLC with a copy of this disclosure as set forth under this Item 4.01 and was requested to furnish a letter addressed to the Securities and Exchange Commission stating whether or not it agrees with the above statements. A copy of the letter from Plante & Moran PLLC is attached hereto as Exhibit 16.1.
(c) Newly appointed independent registered public accounting firm.
On March 18, 2019, the Audit Committee approved the appointment of BDO India LLP (“BDO”) as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2019, subject to completion of its standard client acceptance procedures.
BDO India LLP was a component auditor for the nine-month period ended December 31, 2018 to audit the Company’s significant business component (Aegis) and was involved in assessing the application of accounting principles and audit issues.
During the two most recent audit periods ended December 31, 2018 and December 31, 2017 (which period is different from the March 31 fiscal year end of Aegis, as Plante & Moran PLLC was not the independent accounting firm of Aegis at such time and the fiscal year end of the Company prior to the Aegis Transactions was December 31) and through March 18, 2019, the effective date of the engagement, except as set forth above, the Company did not consult with BDO regarding (a) the application of accounting principles to a specified transaction, (b) the type of audit opinion that might be rendered on the Company’s financial statements by BDO, in either case where written or oral advice provided by BDO would be an important factor considered by the Company in reaching a decision as to any accounting, auditing or financial reporting issues or (c) any other matter that was the subject of a disagreement between StarTek and its former auditor or was a reportable event (as described in Items 304(a)(1)(iv) or Item 304(a)(1)(v) of Regulation S-K, respectively).
Item 9.01.Financial Statements and Exhibits.
(d) Exhibits:
The following exhibit is filed herewith:
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16.1 |
Letter of Plante & Moran, PLLC
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StarTek, Inc. Exhibit
EX-16.1 2 srt_ex161srtpr3-22×19.htm EXHIBIT 16.1 Exhibit Exhibit 16.1March 22,…
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About StarTek, Inc. (NYSE:SRT)
StarTek, Inc. (STARTEK) is a customer engagement business process outsourcing (BPO) services company, which is delivering customer care solutions. The Company operates its business in three segments, based on the geographic regions: Domestic, Nearshore, and Offshore. Its Domestic segment includes the operations of approximately 10 facilities in the United States and one facility in Canada. Its Offshore segment includes the operations of approximately four facilities in the Philippines. Its Nearshore segment includes the operations of approximately two facilities in Honduras and one facility in Jamaica. Its service offerings include customer care, sales support, inbound sales, complex order processing, accounts receivable management, technical and product support, up-sell and cross-sell opportunities, and other industry-specific processes.