Business Context and Reporting Period
Company: Spectral AI, Inc. (Nasdaq: MDAI, MDAIW)
Filing Type: Form 8-K (Current Report)
Date of Report: May 29, 2025
Reporting Period: Immediate event reporting regarding changes in the independent registered public accounting firm.
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 audit firm transitions.
Material Changes Versus Prior Period
- Dismissal of Auditor: KPMG LLP was dismissed as the independent registered public accounting firm effective May 29, 2025. KPMG had served the Company since 2021.
- Engagement of Successor: Forvis Mazars Group ("Forvis") was engaged as the new independent registered public accounting firm for the fiscal year ending December 31, 2025.
- Audit History: KPMG's audit reports for the fiscal years ended December 31, 2024, and 2023, did not contain adverse opinions, disclaimers, or qualifications regarding uncertainties, scope, or accounting principles.
Guidance, Risks, and Contingencies
Reportable Events and Internal Controls: The filing discloses that KPMG communicated material weaknesses in the Company's internal control over financial reporting, which were previously reported in the Company's 2024 and 2023 Form 10-K filings. These weaknesses include:
- 2024 Weakness: Financial close process controls where accounts did not consistently operate effectively or lacked appropriate evidence for timely and precise reconciliations, transactions, and journal entries.
- 2023 Weaknesses:
- Lack of communication within management regarding complex and unusual arrangements.
- Inadequately designed controls for recording operating expenses, related accruals, and unbilled revenue in the correct period.
- Financial close process controls similar to those identified in 2024.
Disagreements: The Company states there were no disagreements with KPMG on accounting principles, practices, or audit scope during the two most recent fiscal years and the interim period through May 29, 2025, other than the aforementioned reportable events regarding internal controls.
Investor Verification Checklist
- Verify the content of the letter from KPMG LLP (Exhibit 16.1) to confirm they agree with the Company's statements regarding the dismissal and reportable events.
- Review the Company's most recent Form 10-K (2024) to assess the status of remediation efforts for the disclosed material weaknesses in internal controls.
- Monitor future filings for the transition timeline and initial audit scope defined by the new auditor, Forvis Mazars Group.
- Confirm whether the change in auditors impacts the Company's ability to meet Nasdaq listing requirements or debt covenants.