Business Context and Reporting Period
This Form 8-K is a current report filed by Ventrus Biosciences, Inc. (not Assembly Biosciences, Inc.) on January 13, 2011. The filing addresses a change in the company's independent registered public accounting firm. The registrant is incorporated in Delaware and maintains its principal executive offices in New York, New York.
Key Financial Metrics
This filing does not contain financial performance data such as revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on corporate governance and auditing matters.
Material Changes
- Dismissal of Accountant: On January 13, 2011, Ventrus dismissed J.H. Cohn LLP, which had served as the independent auditor since August 31, 2009.
- Engagement of New Accountant: On January 18, 2011, Ventrus appointed EisnerAmper LLP as the new independent registered public accounting firm for the year ended December 31, 2010.
- Audit History: J.H. Cohn's reports for the periods ended December 31, 2009 and 2008 did not contain adverse opinions or disclaimers. However, the reports included an explanatory paragraph regarding the company's ability to continue as a going concern.
- Disagreements: There were no disagreements with J.H. Cohn regarding accounting principles, practices, or auditing scope during the two years ended December 31, 2010.
Management Commentary, Risks, and Contingencies
Material Weaknesses: J.H. Cohn identified material weaknesses in Ventrus's financial reporting process prior to dismissal. These weaknesses included:
- Lack of accounting expertise.
- Inadequate segregation of duties.
- Lack of independent review over financial reporting.
Going Concern Risk: The previous auditor's reports highlighted uncertainty regarding the company's ability to continue as a going concern, a significant risk factor for investors.
Consultations: Ventrus confirmed that no consultations occurred with the new auditor, EisnerAmper, regarding reportable events or accounting matters prior to their engagement.
Investor Verification Checklist
- Verify the status of the "going concern" warning issued by the previous auditor and any subsequent capital raises or operational changes addressing this risk.
- Review the specific remediation plans Ventrus has implemented to address the material weaknesses in internal controls (expertise, segregation of duties, independent review).
- Confirm the timeline for the transition of audit responsibilities from J.H. Cohn to EisnerAmper and the scope of the new firm's initial review.
- Check for any subsequent filings (e.g., 10-K or 10-Q) that provide the financial data missing from this 8-K to assess the company's current liquidity and solvency.