Business Context and Reporting Period
This Form 8-K Current Report is filed by Capital Southwest Corporation on June 12, 2017. The report discloses a change in the Company's 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 regarding the external auditor.
Material Changes
- Dismissal of Previous Auditor: The Audit Committee approved the dismissal of Grant Thornton LLP as the independent registered public accounting firm, effective June 12, 2017.
- Engagement of New Auditor: The Company engaged RSM US LLP as its new independent registered public accounting firm, effective immediately on June 12, 2017.
- Audit Opinions: Grant Thornton's reports for fiscal years ended March 31, 2017, and 2016 were unqualified and did not contain adverse opinions, disclaimers, or modifications regarding uncertainty, scope, or accounting principles.
- Disagreements: There were no disagreements with Grant Thornton on accounting principles, practices, or auditing scope during the relevant periods.
Outlook, Risks, and Contingencies
Internal Control History: The filing references a material weakness in internal control over financial reporting related to the preparation and review of the statement of cash flows (specifically the classification of cash receipts and payments) that existed through September 30, 2015. Management and Grant Thornton concurred that this weakness was remediated as of March 31, 2016, following personnel and control changes in fiscal 2016.
Consultation with New Auditor: The Company confirms no consultations occurred with RSM US LLP regarding accounting principles or reportable events prior to their engagement.
Investor Verification Checklist
- Verify the effective date of the auditor transition (June 12, 2017).
- Confirm the identity of the successor auditor (RSM US LLP).
- Review the attached letter from Grant Thornton LLP (Exhibit 16.1) for any additional commentary on the dismissal.
- Check subsequent filings to ensure the new auditor's first report aligns with the remediated internal controls status.