8-K: Community Trust Bancorp Changes Independent Auditor to BDO for Fiscal Year 2025

Community Trust Bancorp has replaced its independent auditor, Forvis Mazars, with BDO, effective for the fiscal year ending December 31, 2025.

Summary

• Community Trust Bancorp, Inc. has changed its independent registered public accounting firm.
• The Board of Directors approved the dismissal of Forvis Mazars, LLP, effective after the completion of the 2024 fiscal year audit.
• BDO, LLP has been engaged as the new independent auditor for the fiscal year ending December 31, 2025.
• The change is effective beginning with the review of the condensed consolidated financial statements for the quarter ending March 31, 2025.
• There were no disagreements or reportable events with Forvis Mazars during the fiscal years ended December 31, 2023 and 2022, and the subsequent interim period.
• Forvis Mazars' audit reports for 2023 and 2022 did not contain any adverse opinions, disclaimers, or qualifications.
• The company did not consult with BDO on any accounting or auditing matters prior to their engagement.

Sentiment

Score: 7

Explanation: The document indicates a routine change in auditors with no apparent issues, suggesting a neutral to slightly positive sentiment. The lack of disagreements with the previous auditor is a positive sign.

Positives

• The transition to a new auditor appears to be smooth, with no reported disagreements with the previous auditor.
• The company has secured a new auditor, BDO, in a timely manner.
• The audit reports of Forvis Mazars for the past two years were clean, with no adverse opinions or qualifications.

Risks

• The change in auditors could introduce some short-term uncertainty as the new auditor becomes familiar with the company's financials.
• There is a risk of potential delays in the audit process during the transition period.

Future Outlook

The company will file an amendment to this report with the specific date of dismissal of Forvis Mazars and an update to the disclosures required by Item 304(a) of Regulation S-K.

Management Comments

• The Board of Directors approved a change to the company's independent registered public accounting firm.
• The company notified Forvis Mazars of its dismissal effective immediately following the completion of its audit of the company's consolidated financial statements as of and for the fiscal year ending December 31, 2024.
• The company notified BDO of its formal decision to engage BDO as the company's independent registered public accounting firm for the fiscal year ending December 31, 2025.

Industry Context

Changes in auditors are not uncommon, but they can be significant events for publicly traded companies. This change may be part of a routine review process or a strategic decision by the company.

Comparison to Industry Standards

• The process of changing auditors is generally consistent with industry standards, requiring approval from the Board and Audit Committee.
• The company's disclosure of no disagreements with the previous auditor is a positive sign, aligning with best practices.
• Many companies in the financial sector use large firms such as BDO for their auditing needs, indicating this is a standard practice.

Stakeholder Impact

• Shareholders may experience a slight increase in uncertainty during the transition period.
• Employees in the finance and accounting departments will need to work with the new auditor.
• The change in auditors is not expected to have a significant impact on customers or suppliers.

Next Steps

• The company will file an amendment to this report with the specific date of dismissal of Forvis Mazars.
• BDO will begin its services with the review of the financial statements for the quarter ending March 31, 2025.

Key Dates

Keywords

auditor, accounting, BDO, Forvis Mazars, financial statements, audit, Community Trust Bancorp