Business Context and Reporting Period
Company: CB Financial Services, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: January 29, 2021
Reporting Period: The filing addresses events occurring on January 29, 2021, regarding the dismissal of the prior independent registered public accounting firm and the engagement of a new firm for the fiscal year ending December 31, 2021.
Key Financial Metrics
This filing does not contain financial performance data. There are no reported values for revenue, profit, cash flow, margins, debt, or liquidity in this document.
Material Changes
The primary material change reported is the replacement of the Company's independent registered public accounting firm:
- Dismissal: Baker Tilly US, LLP was dismissed effective upon completion of the audit for the fiscal year ended December 31, 2020.
- Engagement: BKD, LLP was selected to serve as the independent registered public accounting firm for the fiscal year ending December 31, 2021.
- Reasoning: The Audit Committee approved the change. The Company stated there were no disagreements with Baker Tilly regarding accounting principles, financial statement disclosure, or auditing scope/procedures.
Guidance, Outlook, Risks, and Contingencies
Historical Audit Opinions: Audit reports by Baker Tilly for the fiscal years ended December 31, 2019, and 2018 were unqualified and did not contain adverse opinions or disclaimers.
Reportable Events: The Company disclosed one reportable event during the relevant period: In the quarter ended March 31, 2019, Baker Tilly advised the Company of a material weakness in the design and operating effectiveness of internal controls over financial reporting. This weakness related to loan classification segments impacting commercial and industrial loans, commercial real estate loans, and residential real estate loans. This was previously disclosed in the Form 10-Q for the period ended March 31, 2019.
Consultations with New Firm: No consultations were held with BKD, LLP regarding accounting principles or reportable events prior to their engagement.
Investor Verification Checklist
- Verify the status of the material weakness in internal controls over financial reporting regarding loan classification segments disclosed in Q1 2019.
- Confirm the completion date of the 2020 fiscal year audit by Baker Tilly to determine the exact effective date of the dismissal.
- Review the letter from Baker Tilly US, LLP (Exhibit 16.1) to confirm their agreement with the Company's statements regarding the dismissal.
- Monitor future filings for the first audit opinion issued by BKD, LLP for the fiscal year ending December 31, 2021.