This excerpt taken from the OSTK DEF 14A filed Apr 2, 2009.
Change in Independent Registered Public Accounting Firm
The Board of Directors has appointed Grant Thornton LLP as independent accountants to audit the Company's financial statements for the fiscal year ending December 31, 2009. PricewaterhouseCoopers LLP ("PwC") had previously served as the Company's independent accountants from 1999 until March 23, 2009, at which time the Company dismissed PwC as the Company's independent accountants. The decision to dismiss PwC was recommended and approved by the Audit Committee of the Company's Board of Directors (the "Audit Committee") on March 23, 2009 as the result of a competitive proposal process.
The reports of PwC on the consolidated financial statements of the Company for the years ended December 31, 2008 and December 31, 2007 did not contain an adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principle. During the Company's two most recent fiscal years ended December 31, 2008 and 2007 and through March 23, 2009, there were no 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 to the subject matter of such disagreements in connection with its reports on the Company's consolidated financial statements for such years. During the Company's two most recent fiscal years ended December 31, 2008 and 2007 and through March 23, 2009, there was one "reportable event" as defined under Item 304(a)(1)(v) of Regulation S-K. In 2008 the Company and Audit Committee discussed with PwC the existence of a material weakness in the Company's internal control over financial reporting and disclosure controls and procedures, as more fully described in the Company's Annual Report on Form 10-K/A for the year ended December 31, 2007, Quarterly Report on Form 10-Q/A for the three months ended March 31, 2008, Quarterly Report on Form 10-Q/A for the three months ended June 30, 2008 and Quarterly Report on Form 10-Q for the three months ended September 30, 2008, each filed November 10, 2008 with the Securities and Exchange Commission (the "SEC"). Management of the Company concluded that the material weakness was remediated as of December 31, 2008. The Company authorized PwC to
respond fully to the inquiries of the new independent registered public accounting firm related to the material weakness.
The Company provided PwC with a copy of the statements made in the preceding paragraph and requested PwC to furnish the Company with a letter addressed to the SEC stating whether or not PwC agrees with the above statements. A copy of PwC's letter to the SEC dated March 24, 2009 was attached as Exhibit 16.1 to the Company's Report on Form 8-K filed with the SEC on March 24, 2009.
The Company has not consulted with Grant Thornton LLP during its two most recent fiscal years or during any subsequent interim period prior to its appointment as auditor regarding any matters described in Item 304(a)(2)(i) or Item 304(a)(2)(ii) of Regulation S-K.
Although ratification of the Audit Committee's selection of Grant Thornton LLP is not required under our bylaws or other legal requirements, the Company is submitting the appointment of Grant Thornton LLP to the stockholders as a matter of good corporate practice. If the stockholders do not ratify the appointment of Grant Thornton LLP, the Audit Committee will reconsider whether or not to retain Grant Thornton LLP. Even if the stockholders ratify the selection of Grant Thornton LLP, the Audit Committee may appoint a different independent registered public accounting firm or replace Grant Thornton LLP with a different independent registered public accounting firm at any time if the Audit Committee determines that it is in the best interests of the Company and the stockholders to do so.
Representatives of Grant Thornton LLP are expected to attend the annual meeting to respond to appropriate questions and will have an opportunity to make a statement if they so desire. For additional information regarding the Company's relationship with its independent registered public accounting firms, please refer to the Report of the Audit Committee on page 24.
The aggregate fees and out-of-pocket expenses PricewaterhouseCoopers LLP billed us for each of the last two fiscal years for professional services for the audits of our annual financial statements, the effectiveness of internal control over financial reporting and reviews of financial statements included in our Reports on Form 10-K and Form 10-Q and amendments thereto and for their services assisting us with our responses to accounting comments from the Staff of the SEC and to the SEC's investigation into our accounting and for services in connection with our registration statements and other matters were $761,000 in 2007 and $820,100 in 2008.
PricewaterhouseCoopers LLP did not bill us any fees in the last two fiscal years for assurance and related services that are reasonably related to the performance of the audit or review of the Company's financial statements and are not reported above under the caption "Audit Fees."
PricewaterhouseCoopers LLP did not bill us any fees in the last two fiscal years for compliance, tax advice, or tax planning.
PricewaterhouseCoopers LLP did not bill us any fees in the last two fiscal years for products and services provided by PricewaterhouseCoopers LLP, other than the services reported above, except for $2,400 in each of 2007 and 2008 for the use of proprietary software.
The Audit Committee has considered the role of PricewaterhouseCoopers LLP in providing us with the services described above, and has concluded that those services were compatible with their independence from management and from the Company.