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) May 26, 2000
1st SOURCE CORPORATION
(Exact name of registrant as specified in its charter)
INDIANA
(State or other jurisdiction of incorporation)
0-6233 35-1068133
(Commission File Number) (I.R.S. Employer
Identification No.)
100 North Michigan Street
South Bend, Indiana 46601
(Address of principal executive offices) (Zip Code)
(219) 235-2702
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address if changed since last report.)
Item 4. Changes in Registrant's Certifying Accountant
(a) (i) 1st Source Corporation ("Registrant") notified
PricewaterhouseCoopers ("PwC") on April 18, 2000 that it would
be conducting a request for proposals for a possible change in
independent accountants. Registrant invited PwC to submit a
proposal. On May 26, 2000, PwC informed the Registrant that it
would not be submitting a proposal in response to the
Registrant's request and, therefore, it declined to stand for
re-election as Registrant's independent accountant. PwC did
agree to complete the audits of three employee benefit plans
which are in process as of the date of this report.
(ii) The reports of PwC on the financial statements for the past
two fiscal years contained no adverse opinion or disclaimer of
opinion and were not qualified or modified as to uncertainty,
audit scope or accounting principle.
(iii) In connection with its audits for the two most recent fiscal
years and through May 26, 2000, there have been no
disagreements with PwC 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 PwC, would have caused them to make
reference thereto in their report on the financial statements
for such years, except for the matter described in the
following paragraph.
There was a disagreement with PwC concerning income
recognition on securitized loans in accordance with SFAS No.
125, "Accounting for Transfers and Servicing of Financial
Assets and Extinguishments of Liabilities." The disagreement
was resolved to PwC's satisfaction in mid- February, 2000
after the Registrant changed its method of estimating the
timing of cash flows and certain assumptions relating to the
securitized loans as well as the Registrant's retained
interests in such loans. These changes in the estimates used
resulted in a difference in the timing of revenue recognition,
but had no effect on total cash flows to be derived from the
securitized transactions. Such changes resulted in the
Registrant filing an amended Form 10-K for 1998, including a
revised auditor's report referring to the revisions, and
related amended Forms 10-Q for the affected periods. The
changes increased net earnings for 1998 from $31,020,000 to
$31,457,000 (a change of 1.4%) with no change in net
earnings for 1999. Management reported regularly to the Audit
Committee regarding these matters prior to reaching resolution
of the disagreement with PwC. The Audit Committee also
discussed the matter directly with PwC on April 18, 2000.
Registrant has authorized PwC to respond fully to inquiries of
its successor auditor concerning these matters.
(iv) During the two most recent fiscal years and through May 26,
2000, there have been no reportable events as defined in
Regulation S-K, Item 304 (a)(1)(v).
(v) The Registrant has requested that PwC furnish it with a letter
addressed to the SEC stating whether or not it agrees with the
above statements. A copy of such letter, dated June 1, 2000,
is filed as Exhibit 16 to this Form 8-K.
(b) Registrant's solicitation of proposals for a change in independent
accountants was conducted at the direction of the Audit Committee of
the Board of Directors. The Audit Committee expects to complete its
review of proposals from other accounting firms and to select a new
independent auditor by mid-June, 2000.
Item 7. Financial Statements and Exhibits
(c) The following exhibit is filed with this report:
Exhibit Number Title
-------------- -----
16 Letter from PricewaterhouseCoopers re:
Change in certifying accountant
SIGNATURES
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 thereunto duly authorized.
1st Source Corporation
----------------------
DATE 06/01/00 /s/ Christopher J. Murphy III
---------- ----------------------------------------
(Signature)
Christopher J. Murphy III
Chairman of the Board, President and CEO
DATE 06/01/00 /s/ Larry E. Lentych
---------- ----------------------------------------
(Signature)
Larry E. Lentych
Treasurer and Chief Financial Officer
4