SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K/A
AMENDMENT NO. 3 TO
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
November 13, 2002
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APPIANT TECHNOLOGIES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 0-21999 84-1360852
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
6663 Owens Drive, Pleasanton, CA 94588
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (925) 251-3200
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ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
(i) On November 13, 2002, PricewaterhouseCoopers LLP ('PwC") resigned as the
Company's independent accountants and advised the Company that its 2001
annual financial statements can no longer be relied upon due to an error
(see Exhibit 16 filed herein).
(ii) PwC's reports on our financial statements for the past two fiscal years
did not contain an adverse opinion or a disclaimer of opinion nor were
they qualified or modified as to uncertainty, audit scope or accounting
principle except that PwC's opinion on our 2001 financial statements
included an explanatory paragraph expressing substantial doubt regarding
our ability to continue as a going concern.
(iii) In connection with its audits for the two most recent fiscal years and
through November 13, 2002, there have been 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 the satisfaction of PwC would have caused them to make
reference thereto in their report on the financial statements for such
years.
(iv) During the two most recent fiscal years and through November 13, 2002, PwC
has advised management and the audit committee that it had identified one
material control weakness and two reportable conditions regarding the
Company's internal accounting controls.
Material Control Weakness: During the course of PwC's reviews and year-end
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audit, PwC noted that the Company did not establish policies and
procedures to ensure that sufficient competent personnel are recruited
into, and retained within, the finance function, sufficiently efficient to
ensure the ongoing strengthening of internal accounting controls and
processes. The existing resources of the finance function are sufficient
to deal with day-to-day operations, however, the position of corporate
controller changed on several occasions during the fiscal year which
resulted in a lack of continuity and supervision of the finance function.
In addition, the Company did not have a Chief Financial Officer for
approximately half of the year. As a result, the Company has been unable
to maintain and improve the control environment during the year, and
provide us with requested information and explanations on a timely basis.
In addition, in certain instances, the accounting staff did not have the
necessary knowledge to carry-out their duties in an efficient manner.
First Reportable Conditions: PwC reported that, the company did not have a
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formal document retention policy. Which was further compounded by the high
turnover of employees in the accounting department and subsequent lack of
supervision. As a result, accounting records and documents were not
readily available, which created inefficiencies for management and lack of
support for assertions in its financial statements. This was particularly
relevant in relation to areas such as goodwill amortization where records
have been continually re-created on a quarterly basis
Second Reportable Condition: During the course of the audit fieldwork, PwC
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noted that the quality of the Company's accounting records could be
significantly improved. Although basic records appeared to have improved,
since the prior year, PwC noted old, unsupported account balances and a
large numbers of reconciling items or reconciling items, which had not
been appropriately adjusted in the Company's general ledger. This resulted
in recording a substantial number of adjustments, some of which were
material, during the audit.
We have authorized PwC to respond fully to the inquiries of any successor
independent accountants concerning this matter.
(v) The Registrant has requested that PwC furnish it with a letter addressed
to the SEC stating whether or not it agrees with the above statements. A
copy of such letter, dated November 26, 2002, is filed as Exhibit 16 to
this Form 8-K.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Appiant Technologies, Inc.
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(Registrant)
Appiant Technologies, Inc.
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(Registrant)
Date: November 20, 2002 /s/ Douglas S. Zorn
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Douglas S. Zorn
Chief Executive Officer