Business Context and Reporting Period
Company: PDF Solutions, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: November 10, 2009
Reporting Period: The filing addresses events occurring on November 10, 2009, regarding the change of 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 is strictly a disclosure of a change in the Company's certifying accountant.
Material Changes
- Dismissal of Auditor: On November 10, 2009, the Board of Directors unanimously approved the dismissal of Deloitte & Touche LLP as the Company's independent registered public accounting firm.
- Appointment of New Auditor: On November 10, 2009, the Audit Committee approved the appointment of PricewaterhouseCoopers LLP (PWC) as the new independent registered public accounting firm for the fiscal year ending December 31, 2009, subject to a formal engagement letter.
- Audit History: Deloitte's reports for the years ended December 31, 2008, and 2007 did not contain adverse opinions or disclaimers. However, the reports included a modification regarding accounting principles related to the Company's sabbatical program (EITF 06-02) and the measurement of tax benefits for uncertain tax positions (FIN 48).
- Disagreements: The Company reported no disagreements with Deloitte on accounting principles, financial statement disclosures, or auditing scope during the two most recent fiscal years or the subsequent period through November 10, 2009.
Guidance, Outlook, and Risks
Management Commentary: The change in auditors resulted from a competitive request for proposal process. The Audit Committee reviewed auditor independence and concluded that PWC has no commercial relationships that would impair its independence.
Consultations: The Company did not engage PWC in any prior consultations regarding accounting principles or audit opinions during the fiscal years ended December 31, 2008 and 2007, or the subsequent period.
Risks/Contingencies: No specific financial risks or contingencies are detailed in this filing beyond the standard disclosure of the auditor change.
Investor Verification Checklist
- Verify the content of the letter from Deloitte & Touche LLP (Exhibit 16.1) to confirm their agreement with the Company's statements regarding the dismissal and lack of disagreements.
- Confirm the execution of the formal engagement letter with PricewaterhouseCoopers LLP.
- Review the Company's most recent 10-K or 10-Q filings to understand the financial impact of the accounting principle modifications (sabbatical program and uncertain tax positions) noted in Deloitte's prior reports.
- Monitor future filings for the first audit report issued by PWC for the fiscal year ending December 31, 2009.