8-K: Friedman Industries Announces Auditor Change to Baker Tilly Following Moss Adams Merger

Friedman Industries, Inc. has appointed Baker Tilly US, LLP as its new independent registered public accounting firm, succeeding Moss Adams LLP, due to a merger between Moss Adams and Baker Tilly.

Summary

• Friedman Industries, Inc. (the "Company") was notified on June 19, 2025, that its independent registered public accounting firm, Moss Adams LLP, merged with Baker Tilly US, LLP, effective June 3, 2025.
• Following the merger, Moss Adams LLP resigned as the Company's auditors.
• The Audit Committee of the Company's Board of Directors approved the appointment of Baker Tilly US, LLP as the successor independent registered public accounting firm.
• Moss Adams LLP's audit reports for the fiscal years ended March 31, 2025, and 2024, and their report on internal control over financial reporting as of March 31, 2025, did not contain any adverse opinions, disclaimers, qualifications, or modifications.
• There were no disagreements with Moss Adams LLP on accounting principles, financial statement disclosure, or auditing scope/procedure during the years ended March 31, 2025, and 2024, or the subsequent interim period.
• No reportable events requiring disclosure under Item 304(a)(1)(v) of Regulation S-K occurred during the specified periods.
• The Company did not consult with Baker Tilly US, LLP regarding accounting principles or audit opinions prior to their appointment.
• Moss Adams LLP provided a letter to the SEC, dated June 24, 2025, confirming their agreement with the statements made by Friedman Industries in the Form 8-K.

Sentiment

Score: 7

Explanation: The sentiment is positive as the auditor change is due to a merger, not performance issues, and there were no disagreements or adverse opinions, indicating good financial reporting practices.

Positives

• The transition of the auditing firm is due to a merger, indicating a standard business event rather than issues with the Company's financial reporting.
• Moss Adams LLP's audit reports for the years ended March 31, 2025, and 2024, and internal control report, contained no adverse opinions, disclaimers, qualifications, or modifications, indicating clean audits.
• There were no disagreements on accounting principles or auditing procedures with Moss Adams LLP, suggesting a smooth relationship and adherence to accounting standards.
• No reportable events were identified, reinforcing the absence of significant accounting or auditing issues.

Risks

• While the change is due to a merger, any change in an independent auditor carries a minor inherent risk of disruption to the audit process or a learning curve for the new firm, though this is mitigated by the continuity from the merger.

Management Comments

• The Company provided Moss Adams with a copy of this Current Report on Form 8-K prior to its filing with the Securities and Exchange Commission and requested that Moss Adams furnish the Company with a letter addressed to the Commission stating whether it agrees with the above statements.

Industry Context

Changes in a company's independent registered public accounting firm are common in the financial industry, often occurring due to mergers, acquisitions, or routine rotation policies. This specific change is a direct result of a merger between two accounting firms, which is a standard occurrence and typically does not signal underlying issues with the client company's financial health or reporting practices. The seamless transition and lack of disagreements or reportable events align with best practices for auditor changes.

Corporate Governance

Stakeholder Impact

• Shareholders: The change ensures continued independent oversight of financial statements, maintaining transparency and confidence in financial reporting.
• Management: Will work with a new auditing firm, requiring coordination for future audits.

Next Steps

• Baker Tilly US, LLP will serve as Friedman Industries, Inc.'s independent registered public accounting firm for future audits.

Key Dates

Recommendation

Keywords

Friedman Industries, FRD, SEC filing, Form 8-K, auditor change, independent registered public accounting firm, Moss Adams LLP, Baker Tilly US LLP, corporate governance, financial reporting, audit committee