FAB Universal changes accounting firms in face of investigation

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FAB Universal has replaced its accounting firm with a new company that will complete an audit of the Pittsburgh digital content provider’s 2013 books that has been delayed by an investigation of the company’s accounting practices.

In a securities filing Tuesday, FAB said it replaced Friedman LLP with KCCW Accountancy Corp.

The company said the investigation prevented FAB personnel from providing certain information Friedman sought in preparing the audit. Friedman also said it would not issue an opinion on FAB’s financial statements until the investigation is completed and balances in some of the company’s Chinese bank accounts are confirmed.

Trading of FAB shares was halted in November after critics accused the company of failing to disclose a $16.3 million bond offering and exaggerating the magnitude of its Chinese operations. The company subsequently restated its financial statements to reflect the debt and admitted that it had discovered “certain deficiencies” with its accounting practices.

It has hired an outside law firm to investigate the irregularities.

FAB’s failure to file 2013 financial statements prompted the New York Stock Exchange to threaten to delist the company’s shares. The Tuesday filing did not indicate whether the company had complied with the exchange’s April 17 deadline to file a plan for meeting listing standards.

FAB disclosed last week that it is seeking a hearing to appeal the delisting.

An NYSE spokeswoman declined comment.

Len Boselovic: 412-263-1941 or lboselovic@post-gazette.com

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