Business Context and Reporting Period
Company: Flotek Industries, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: July 21, 2006
Principal Event: Change in the Company's certifying independent public accountant.
Financial Metrics
This filing is a current report regarding a change in auditors and does not contain financial statements, revenue, profit, cash flow, margin, debt, or liquidity data. The filing text does not provide a clear value for any financial metrics.
Material Changes
- Resignation of Former Auditor: UHY Mann Frankfort Stein & Lipp CPAs, LLP ("UMFSL") resigned as the Company's independent public auditors on July 21, 2006. This resignation coincides with UMFSL partners joining UHY LLP, a separate legal entity.
- Engagement of New Auditor: On July 21, 2006, the Company engaged UHY LLP as its new independent public auditor for the fiscal year ending December 31, 2006, and interim periods prior to that date.
- Audit History: UMFSL's reports for the past two years and interim periods contained no adverse opinions, disclaimers, or qualifications regarding uncertainty, scope, or accounting principles.
- Disagreements: There were no disagreements between the Company and UMFSL on accounting principles, practices, or auditing scope during the two most recent fiscal years or the interim period through July 21, 2006.
Guidance, Outlook, and Risks
Management Commentary: The decision to change principal accountants was approved by the Audit Committee of the Board. The Company confirmed it has not consulted with the new auditor (UHY) regarding accounting principles or audit opinions for the two most recent fiscal years or the interim period through July 21, 2006.
Risks and Contingencies: The filing does not disclose new material risks or contingencies beyond the administrative change in audit firm. The former auditor (UMFSL) provided a letter to the SEC agreeing with the Company's statements regarding the change.
Key Facts for Investor Verification
- Verify the independence and qualifications of the new auditor, UHY LLP.
- Confirm that the resignation of UMFSL was not due to any undisclosed disagreements or reportable events.
- Review the letter from UMFSL filed as Exhibit 16.1 to ensure no dissenting views were expressed regarding the Company's financial reporting.
- Monitor future filings for the impact of the auditor transition on the audit of the fiscal year ending December 31, 2006.