8-K: American Picture House Corp. Changes Accounting Firms: Olayinka Oyebola & Co. Dismissed, LAO Professionals Engaged

American Picture House Corporation (APHC) has dismissed Olayinka Oyebola & Co. as its independent auditor and engaged LAO Professionals, effective April 3, 2025.

Summary

• American Picture House Corporation (the 'Company') announced a change in its independent registered public accounting firm.
• Effective April 3, 2025, Olayinka Oyebola & Co. ('Olayinka') was dismissed as the Company's independent auditor, a decision approved by the Audit Committee.
• The OTC Markets advised the company that Olayinka is a prohibited service provider.
• During Olayinka's tenure, there were no disagreements on accounting principles, financial statement disclosure, or auditing scope that would have required mention in their report.
• For the years ended December 31, 2023 and 2024, and through April 3, 2025, there were no reportable events as described in Item 304(a)(1)(v) of Regulation S-K.
• The Company requested a letter from Olayinka to the Securities Exchange Commission agreeing with the disclosures, but as of the report date, Olayinka had not responded.
• Effective April 3, 2025, LAO Professionals ('LAO') was engaged as the Company's independent auditor for the third fiscal quarter of 2024, based on their ability to meet reporting requirements and alignment with the Company's needs.
• During the two most recent fiscal years and through April 7, 2025, the Company did not consult with LAO regarding accounting principles or the type of audit opinion.

Sentiment

Score: 4

Explanation: The sentiment is slightly negative due to the unusual circumstances surrounding the auditor change, specifically the 'prohibited service provider' designation. While the company is addressing the issue, it raises concerns about past compliance.

Positives

• The company proactively addressed the issue of using a prohibited service provider by dismissing Olayinka.
• The transition to a new auditor, LAO Professionals, was based on their ability to meet the Company's reporting requirements.
• There were no disagreements with the previous auditor on critical accounting or auditing matters.

Negatives

• The dismissal of Olayinka Oyebola & Co. was due to the OTC Markets advising that they are a prohibited service provider, which could raise concerns about previous compliance.
• Olayinka has not yet agreed nor declined to provide a letter to the SEC regarding the statements made in the filing, which could indicate potential issues.

Risks

• The delay in receiving a letter from Olayinka Oyebola & Co. to the SEC could lead to further scrutiny.
• The need to change auditors may cause temporary disruptions in financial reporting processes.
• The company's reliance on LAO Professionals to meet reporting requirements introduces a dependency on their performance.

Future Outlook

The document does not contain specific forward-looking statements regarding financial performance or future business activities.

Industry Context

Changes in auditors are relatively common, but the reason for the change (prohibited service provider) is unusual and could raise concerns. Companies typically seek to avoid any appearance of impropriety in their financial reporting, so this change is likely intended to address a compliance issue.

Comparison to Industry Standards

• Auditor changes are a normal part of corporate governance, but the circumstances surrounding this change are not typical.
• Companies like General Electric, which changed auditors from KPMG to Deloitte after over 100 years, often do so after a formal bidding process and for strategic reasons, not due to compliance issues.
• Smaller companies may face challenges in finding suitable auditors, but the OTC Markets' designation of Olayinka as a prohibited service provider is a specific and concerning issue.

Stakeholder Impact

• Shareholders may be concerned about the reason for the auditor change and its potential impact on the company's financial reporting.
• The change in auditors could affect the confidence of creditors and other stakeholders in the company's financial statements.

Next Steps

• The Company will file Exhibit 16.1 with a letter from Olayinka Oyebola & Co. upon receipt.
• LAO Professionals will serve as the independent registered public accounting firm for the third fiscal quarter of 2024.

Key Dates

Keywords

independent auditor, LAO Professionals, Olayinka Oyebola & Co., accounting firm, dismissal, engagement, American Picture House Corporation, auditor