8-K: Simulations Plus Changes Accounting Firms, Appoints Grant Thornton

Simulations Plus has dismissed Rose, Snyder & Jacobs LLC and appointed Grant Thornton LLP as its new independent registered public accounting firm, effective immediately.

Summary

• Simulations Plus has changed its independent registered public accounting firm.
• The Audit Committee approved the dismissal of Rose, Snyder & Jacobs LLC (RSJ) on April 15, 2025.
• The Audit Committee approved the appointment of Grant Thornton LLP as the new firm, effective immediately on April 15, 2025.
• There were no disagreements or reportable events with RSJ during the fiscal years ended August 31, 2024 and August 31, 2023, and the subsequent interim period.
• RSJ's audit report for the fiscal year ended August 31, 2024, did not contain an adverse opinion or disclaimer of opinion and was not qualified or modified.
• Simulations Plus did not consult Grant Thornton on accounting principles or audit opinions during the past two fiscal years and the subsequent interim period.
• RSJ provided a letter to the SEC agreeing with the statements made by Simulations Plus regarding their dismissal.

Sentiment

Score: 7

Explanation: The announcement is neutral to slightly positive. The change in accounting firms appears orderly, with no reported issues with the previous firm. The selection of Grant Thornton suggests a commitment to maintaining financial reporting standards.

Positives

• The transition to a new accounting firm appears to be smooth, with no reported disagreements with the previous firm.
• The audit report from the previous firm for the fiscal year ended August 31, 2024, was unqualified, indicating sound financial reporting.

Risks

• The change in accounting firms could potentially lead to increased scrutiny from investors until Grant Thornton establishes a track record with Simulations Plus.

Future Outlook

The company will be audited by Grant Thornton for the fiscal year ending August 31, 2025.

Industry Context

Changes in accounting firms are not uncommon, but investors often pay close attention to ensure a smooth transition and continued financial reporting integrity. The selection of Grant Thornton, a well-established firm, suggests a commitment to maintaining high standards.

Comparison to Industry Standards

• The process of selecting a new auditor through a competitive process is a standard practice in corporate governance.
• Companies like Certara and Schrodinger, which are also in the modeling and simulation space, typically engage large, reputable accounting firms to ensure credibility and compliance.
• The absence of disagreements with the previous auditor is a positive sign, aligning with industry best practices for auditor transitions.

Stakeholder Impact

• Shareholders may want to monitor the transition to the new accounting firm to ensure continued financial reporting quality.
• Employees in the finance and accounting departments will likely be involved in the transition process.

Key Dates

Keywords

accounting firm, Grant Thornton, Rose Snyder & Jacobs, audit committee, independent auditor, Simulations Plus, financial statements, auditing