Attached files
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| EX-16 - Ubiquiti Inc. | ex16-12082016_011211.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT PURSUANT TO
SECTION 13
or 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported): December 5,
2016
UBIQUITI
NETWORKS, INC.
(Exact name of
registrant as specified in its charter)
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Delaware
(State or other
jurisdiction of incorporation)
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001-35300
(Commission File
Number)
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32-0097377
(IRS Employer
Identification No.)
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2580
Orchard Parkway
San Jose, CA 95131
(Address of
principal executive offices, including zip code)
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(408) 942-3085
(Registrant’s
telephone number, including area code)
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N/A
(Former name or
former address, if changed since last report)
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Check the
appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
☐
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Written
communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425) |
☐
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Soliciting material
pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12) |
☐
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b)) |
☐
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c)) |
Item
4.01
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Changes
in Registrant’s Certifying Accountant. |
Previous
independent registered public accounting firm
On December 5,
2016, the Audit Committee (the “Audit Committee”) of
Board of Directors (the “Board”) of Ubiquiti Networks,
Inc. (the “Company”) determined to change the
Company’s independent registered public accounting firm
effective as of December 5, 2016, and on December 5, 2016, the
Company dismissed PricewaterhouseCoopers LLP (“PwC”),
the Company’s then current independent registered public
accounting firm.
The reports of PwC
on the Company’s financial statements for the fiscal years
ended June 30, 2015 and 2016 did not contain an adverse opinion or
disclaimer of opinion, and such reports were not qualified or
modified as to uncertainty, audit scope, or accounting
principles.
During the fiscal
years ended June 30, 2015 and 2016, and the subsequent interim
period through December 5, 2016, the Company has not had any
disagreements with PwC on any matter of accounting principles or
practices, financial statement disclosure or auditing scope or
procedure, which disagreements, if not resolved to PwC’s
satisfaction, would have caused PwC to make reference thereto in
their reports on the Company’s financial statements for such
years.
During the fiscal
years ended June 30, 2015 and 2016, and the subsequent interim
period through December 5, 2016, there were no reportable events,
as defined in Item 304(a)(1)(v) of Regulation S-K, except as set
forth below.
As reported in its
Annual Reports on Form 10-K for the years ended June 30, 2015 and
2016, management concluded that the Company did not maintain
effective internal control over financial reporting as of June 30,
2015 and 2016, respectively, due to the material weaknesses
described below.
Management
determined that the Company did not maintain an effective control
environment, attributable to a lack of sufficient, competent
personnel necessary for effective financial reporting. This
resulted in the lack of comprehensive and up-to-date accounting
policies and procedures, skepticism on the part of key accounting
personnel, internal control training, leadership and adequate
communication of roles and responsibilities. Growth in the
complexity of the business without commensurate growth in the
capabilities of the finance and accounting organization contributed
to this deficiency.
The Company’s
failure to maintain an effective control environment contributed to
a second deficiency in the form of ineffectively designed and
maintained controls required for safeguarding of the
Company’s funds and timely detection of improper transactions
in the general ledger. Specifically, the Company’s
disbursement authorization policies were not updated timely for
changes in personnel and positions, nor were authorization
requirements clearly stated, including those for non-routine
transactions.
The Company’s
failure to maintain an effective control environment also
contributed to a third deficiency in the form of ineffectively
designed and maintained controls over user access and transaction
privileges to modify and post entries to the general ledger and
subsidiary ledgers. In particular, the scope of user access and
transaction privileges to the general ledger and subsidiary ledgers
is not sufficiently restricted to provide reasonable assurance of
effective process and review controls over postings to the general
ledger. Additionally, general ledger changes were completed without
due consideration of collateral impacts on segregation of duties
controls.
The subject matter
of these material weaknesses was discussed by the Audit Committee
with PwC. The Audit Committee has authorized PwC to respond
fully to the inquiries of the successor independent registered
public accounting firm concerning these material
weaknesses.
The Company
provided PwC with a copy of this disclosure as set forth under this
Item 4.01 and requested PwC to furnish a letter addressed to the
Securities and Exchange Commission stating whether or not it agrees
with the above statements and, if not, stating the respects in
which it does not agree. A copy of the response letter from PwC is
attached hereto as Exhibit 16.1.
New
independent registered public accounting firm
On December 7,
2016, the Audit Committee engaged KPMG LLP (“KPMG”) to
serve as the independent registered public accounting firm for the
Company, effective as of such date.
During the fiscal
years ended June 30, 2015 and 2016, and through the effective date
of their engagement, the Company did not consult with KPMG
regarding (a) the application of accounting principles to a
specified transaction, either completed or proposed or (b) the type
of audit opinion that might be rendered on the Company’s
financial statements, in either case where a written report was
provided to the Company or oral advice provided that KPMG concluded
was an important factor considered by the Company in reaching a
decision as to any accounting, auditing or financial reporting
issues. Additionally, during the fiscal years ended June 30, 2015
and 2016, and through the effective date of their engagement, the
Company did not consult with KPMG regarding any other matter that
was either the subject of a disagreement between the Company and
its former auditor or was a reportable event (as described in Item
304(a)(1)(iv) or Item 304(a)(1)(v) of Regulation S-K,
respectively).
Item
8.01
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Other
Events. |
As a result of its
change of independent registered public accounting firms, the Board
has determined to withdraw Proposal 2 from the shareholder vote at
the Company’s upcoming annual meeting of stockholders on
December 14, 2016 (the “Annual Meeting”). Proposal 2
was to ratify the appointment of PwC as the Company’s
independent registered public accounting firm for the fiscal year
ending June 30, 2017. The Company does not intend to submit at the
Annual Meeting any other proposal for ratification of the
appointment of its independent registered public accounting
firm.
Item
9.01
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Financial
Statements and Exhibits. |
(d) Exhibits
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Exhibit No.
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Description
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16.1
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Letter from
PricewaterhouseCoopers LLP dated December 7, 2016.
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SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
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Date:
December 8, 2016
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Ubiquiti
Networks, Inc.
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By:
/s/ Robert J.
Pera
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Name: Robert
J. Pera
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Title: Chief
Executive Officer
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