| Item 4.01 | Changes in Registrant’s Certifying Accountant |
The Audit Committee (the “Audit Committee”) of the Board of Directors of Amplify Energy Corp. (the “Company”), with the assistance of the Company’s management, recently completed a competitive process to select the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2020 (“Fiscal 2020”). The Audit Committee invited multiple firms to participate in this process. At the conclusion of this process, on January 22, 2020, the Audit Committee appointed Deloitte & Touche LLP (“Deloitte”) as the Company’s independent registered public accounting firm for Fiscal 2020, subject to execution of an engagement letter. This action will result in the dismissal of KPMG LLP (“KPMG”), who is currently serving as the Company’s independent auditors, upon completion of their audit of the Company’s consolidated financial statements as of and for the year ended December 31, 2019 and the effectiveness of internal control over financial reporting as of December 31, 2019, and the issuance of their reports thereon.
The audit reports of KPMG on the consolidated financial statements of Amplify Energy Corp. and subsidiaries as of and for the years ended December 31, 2018 and 2017 did not contain an adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles, except as follows:
KPMG’s report on the consolidated financial statements of Amplify Energy Corp. and subsidiaries as of and for the years ended December 31, 2018 and 2017, contained a separate paragraph stating that, “As discussed in note 2 to the consolidated financial statements, on April 14, 2017, the United States Bankruptcy Court for the Southern District of Texas entered an order confirming the plan for reorganization, which became effective on May 4, 2017. Accordingly, the accompanying consolidated financial statements have been prepared in conformity with Accounting Standards Codification Topic 852, Reorganizations, for the Successor as a new entity with assets, liabilities and a capital structure having carrying amounts not comparable with prior periods (Predecessor) as described in note 1.”
The audit reports of KPMG on the effectiveness of internal control over financial reporting as of December 31, 2018 and 2017 did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles.
During the fiscal years ended December 31, 2018 and 2017, and the subsequent interim periods through January 22, 2020 there were no: (1) disagreements (as defined in Item 304(a)(1)(iv) of RegulationS-K and the related instructions) with KPMG on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which if not resolved to the satisfaction of KPMG would have caused KPMG to make reference thereto in its reports on the consolidated financial statements for such years, or (2) reportable events (as described in Item 304(a)(1)(v) of RegulationS-K).
The Company delivered a copy of this Current Report on Form8-K to KPMG on January 22, 2020 and requested that a letter addressed to the Securities and Exchange Commission stating whether or not it agrees with the statements made in response to this Item and, if not, stating the respects in which it does not agree. KPMG responded with a letter dated January 24, 2020, stating that KPMG agrees with the statements set forth above, a copy of which is filed as Exhibit 16.1 to this Current Report on Form8-K and is incorporated by reference herein.
During the years ended December 31, 2018 and 2017, and the subsequent interim periods through January 22, 2020, neither the Company nor anyone on their behalf consulted with Deloitte, regarding either (i) the application of accounting principles to a specific transaction, completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements, and neither a written report nor oral advice was provided to the Company that Deloitte concluded was an important factor considered by the Company in reaching a decision as to any accounting, auditing or financial reporting issue or (ii) any matter that was either the subject of a disagreement (as defined in Item 304(a)(1)(iv) of RegulationS-K and the related instructions) or a reportable event (as described in Item 304(a)(1)(v) of RegulationS-K).
The Company’s stockholders entitled to vote at the Company’s 2020 annual meeting of stockholders will be asked to ratify the selection of Deloitte as the Company’s independent registered public accounting firm for Fiscal 2020.
