8-K: ABVC BioPharma Changes Independent Auditors

ABVC BioPharma, Inc. has dismissed Simon & Edward, LLP and engaged Kreit & Chiu CPA LLP as its new independent registered public accounting firm.

Summary

• ABVC BioPharma, Inc. announced on July 2, 2026, that its Audit Committee approved the dismissal of Simon & Edward, LLP (S&E) as its independent registered public accounting firm.
• The company has engaged Kreit & Chiu CPA LLP (KC) to serve as its independent registered public accounting firm for the fiscal year ending December 31, 2026.
• S&E served as the company's auditor from October 17, 2024, to June 30, 2026.
• S&E's reports for the fiscal years ended December 31, 2024, and 2025, did not contain adverse opinions or disclaimers, but did include an explanatory paragraph regarding the company's ability to continue as a going concern.
• There were no disagreements with S&E on accounting principles, financial statement disclosures, or auditing procedures during the period.
• The company did identify material weaknesses in its internal control over financial reporting.
• ABVC BioPharma has provided S&E with a copy of the disclosure and requested a letter of agreement, which has been filed as Exhibit 16.1.
• The company did not consult with KC on any matters or reportable events prior to the engagement.

Sentiment

Score: 4

Explanation: StockSavvy.ai views this as a neutral to slightly negative filing due to the change in auditors coinciding with 'going concern' warnings and 'material weaknesses' in internal controls from the previous auditor.

Positives

• No disagreements with the former auditor on accounting principles or practices.
• The former auditor's reports did not contain adverse opinions or disclaimers, except for a going concern explanatory paragraph.

Negatives

• The company's ability to continue as a going concern was noted in the former auditor's reports for fiscal years 2024 and 2025.
• Material weaknesses in the company's internal control over financial reporting were identified.

Risks

• The company's ability to continue as a going concern, as noted by the previous auditor, suggests potential financial instability.
• Identified material weaknesses in internal control over financial reporting could lead to future accounting errors or misstatements.

Future Outlook

The company has engaged Kreit & Chiu CPA LLP as its independent registered public accounting firm for the fiscal year ending December 31, 2026.

Management Comments

• The company has provided S&E with a copy of the disclosure and requested that S&E furnish a letter addressed to the U.S. Securities and Exchange Commission (the Commission) stating whether or not it agrees with the above statements.

Industry Context

StockSavvy.ai notes that auditor changes are common in the life sciences sector, often occurring when companies are undergoing significant financial scrutiny or restructuring. The mention of 'going concern' and 'material weaknesses' by the outgoing auditor warrants close attention from investors.

Corporate Governance

Stakeholder Impact

• Shareholders: May be concerned about the 'going concern' note and 'material weaknesses' in internal controls, potentially impacting investor confidence.
• Creditors: May scrutinize the company's financial health more closely due to the going concern disclosure.
• Regulators: Will review the auditor change and the reasons cited, particularly the material weaknesses.

Next Steps

• Kreit & Chiu CPA LLP will serve as the independent registered public accounting firm for the fiscal year ending December 31, 2026.
• Simon & Edward, LLP is expected to provide a letter to the SEC confirming their agreement with the statements made in the filing.

Key Dates

Recommendation

The change in auditors, coupled with the previous auditor's 'going concern' note and identified 'material weaknesses' in internal controls, introduces uncertainty. While there were no disagreements with the former auditor, these disclosures warrant a cautious 'hold' until the new auditor's findings and the company's remediation efforts become clearer.

Keywords

auditor change, ABVC BioPharma, Simon & Edward, LLP, Kreit & Chiu CPA LLP, Form 8-K, going concern, internal controls, SEC filing