UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) March 4, 2005
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ENERGY WEST, INCORPORATED
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(Exact name of registrant as specified in its charter)
MONTANA 0-14183 81-0141785
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1 First Avenue South, Great Falls, Montana 59401
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (406) 791-7500
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
| | Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
| | Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
| | Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
| | Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 4.01 Changes in Registrant's Certifying Accountant.
(a) Dismissal of Independent Accounting Firm.
(i) Pursuant to its normal review of its outside audit requirements,
the Audit Committee of the Board of Directors of the Company
requested proposals for its independent auditor services.
Pursuant to the award of services to another firm, the Company
dismissed Deloitte & Touche LLP (the "principal accountant") as
its independent accountant on March 4, 2005.
(ii) Except as otherwise disclosed herein, none of the principal
accountant's reports on the consolidated financial statements of
the Company for the Company's two most recent fiscal years
contained an adverse opinion or a disclaimer of opinion, or was
qualified or modified as to uncertainty, audit scope, or
accounting principles. In its unqualified opinion dated September
30, 2003, the principal accountant noted that effective July 1,
2002, the Company adopted the provisions of Statement of
Financial Accounting Standards ("SFAS") No. 143, Accounting for
Asset Retirement Obligations. In its unqualified opinion dated
December 16, 2004, the principal accountant noted that the
consolidated financial statements for fiscal years 2003 and 2002
had been restated.
(iii)The decision to change independent accountants was approved by
the Audit Committee of the Board of Directors of the Company.
(iv) During the preceding two fiscal years and any subsequent interim
period preceding the dismissal of the principal accountant, the
Company had no disagreements with the principal accountant on any
matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements,
if not resolved to the satisfaction of the principal accountant,
would have caused the principal accountant to make reference to
the subject matter of the disagreements in connection with the
principal accountant's reports.
(v) Except as otherwise disclosed herein, none of the reportable
events listed in paragraphs (a) (1) (v) (A) - (D) of Item 304 of
Regulation S-K occurred during the two most recent fiscal years
and any subsequent interim periods preceding the dismissal of the
principal accountant. On September 29, 2004, the Company issued a
press release announcing that the previously issued consolidated
financial statements for the fiscal years ended June 30, 2002 and
June 30, 2003 and the first three quarters of the fiscal year
ended June 30, 2004 should not be relied upon because of errors
in those financial statements and that the Company likely would
restate those financial statements to make the necessary
accounting adjustments. In connection with the Company's audit
for fiscal 2004, and after discussions between the Audit
Committee and the principal accountant, the Company
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corrected its accounting with regard to certain natural gas
agreements following a review which identified accounting
treatment issues with the agreements. The Company's principal
accountant advised the Company that it had identified a material
weakness in the Company's internal control over financial
reporting in connection with energy contracts. During fiscal year
2004 and the first part of fiscal year 2005, the Company
implemented changes in the internal control over financial
reporting to address the material weakness. Those changes
involved implementation of procedures respecting the contracting
for gas under natural gas purchase and sale agreements, including
establishing a separation between the deal-making function and
the accounting and contract administration functions,
establishment of record systems and procedures that require
reconciliation of actual performance by the contracting parties
against the prices, quantities and other material terms specified
in the agreements, and redundant documentation for every
agreement regarding its classification pursuant to SFAS No. 133.
The procedures are designed to make sure that all material
obligations entered into on behalf of the Company or its
subsidiaries receive proper review and that those agreements are
enforced and performed according to their terms and conditions.
The procedures are also designed to make sure that the Company
complies with applicable accounting requirements. The Company has
authorized the principal accountant to respond fully to the
inquiries of the new independent accountant, Hein & Associates
LLP, concerning the material weakness and related restatement of
the Company's consolidated financial statements for fiscal years
2002 and 2003 and the first three quarters of fiscal 2004.
(vi) The Company has requested that the principal accountant furnish a
letter stating whether or not the principal accountant agrees
with the above statements. A copy of this letter will be filed as
an exhibit to a current report on Form 8-K within two business
days of its receipt.
(b) Engagement of New Independent Accountants.
(i) On March 4, 2005, the Company engaged Hein & Associates LLP (the
"new independent accountant") to audit the Company's consolidated
financial statements. The new independent accountant was not
consulted on any matter described in Item 304(a)(2) of Regulation
S-K during the Company's two most recent fiscal years and
subsequent interim periods preceding the engagement of the new
independent accountant. Although Hein & Associates LLP was not
consulted on the application of accounting principles in regards
to the derivative accounting related to natural gas contracts,
the Company did engage Hein & Associates LLP as a consultant to
review the work that the Company completed in its internal
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analysis of these contracts. The results of the procedures
performed by management, and consulted on by Hein & Associates
LLP, were reported in its Annual Report on Form 10-K for the year
ended June 30, 2004. There were no differing views on the
analysis of the Company's natural gas contracts among Hein &
Associates LLP, Deloitte & Touche LLP or the Company.
Additionally, Hein & Associates LLP did not consult or advise the
Company on any changes to its internal controls related to the
material weakness noted by Deloitte & Touche LLP. The new
independent accountant has reviewed and approved the content of
this report on Form 8-K.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ENERGY WEST, INCORPORATED
By: /s/ John C. Allen
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John C. Allen
Senior Vice President and
General Counsel
Date: March 10, 2005
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