Business Context and Reporting Period
This Form 8-K is a current report filed by MIMEDX GROUP, INC. on August 4, 2017. The filing addresses a corporate governance event regarding the selection of the Company's independent registered public accounting firm for the fiscal year ending December 31, 2017.
Key Financial Metrics
The filing text does not provide specific values for revenue, profit, cash flow, margins, debt, or liquidity. This report focuses exclusively on the change in the external auditor and does not contain financial statement data.
Material Changes
- Change in Certifying Accountant: The Audit Committee appointed Ernst & Young LLP as the independent registered public accounting firm effective August 4, 2017.
- Dismissal of Prior Auditor: Cherry Bekaert LLP, the auditor for the fiscal year ended December 31, 2016, was dismissed effective August 4, 2017.
- Audit Disagreements: There were no disagreements with Cherry Bekaert regarding accounting principles, financial statement disclosures, or auditing scope during the 2015 and 2016 fiscal years or the interim period through August 4, 2017.
- Internal Control Weakness: Cherry Bekaert's report for the fiscal year ended December 31, 2016, noted a material weakness in internal controls over financial reporting. This weakness related to the design of controls over tax accounting, specifically a lack of adequate supervision and review of technical tax accounting performed by a third-party specialist in 2016.
Guidance, Outlook, and Risks
The filing does not contain forward-looking guidance, management commentary on future operations, or new risk factors. The primary disclosure relates to the transition of audit responsibilities and the historical context of the prior auditor's report on internal controls.
Investor Verification Checklist
- Verify the effective date of the engagement with Ernst & Young LLP (August 4, 2017).
- Confirm the status of the material weakness in tax accounting controls identified in the 2016 audit and whether remediation has been completed.
- Review the letter from Cherry Bekaert LLP (Exhibit 16.1) to ensure they concur with the Company's statements regarding the dismissal and lack of disagreements.
- Monitor future filings for the first financial statements audited by Ernst & Young LLP.