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): August 23, 2005
THE READER'S DIGEST ASSOCIATION, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-10434 13-1726769
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification Number)
Pleasantville, New York 10570-7000
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(914) 238-1000
Check the appropriate box below if the Form 8-K is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
[ ] Written communication 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 240.14a-2(b)) [ ] Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Page 1 of 6 pages.
ITEM 4.01. Changes in Registrant's Certifying Accountant
After The Reader's Digest Association, Inc. ("RDA") completed its fiscal year
ended June 30, 2005, the Audit Committee of RDA's Board of Directors determined
that the Committee would issue a request for proposals regarding the engagement
of an independent registered public accounting firm to audit RDA's financial
statements for the fiscal year ending June 30, 2006. The request for proposals
was issued on August 3, 2005 to several large, international public accounting
firms, including KPMG. On August 23, 2005, KPMG informed RDA that KPMG would not
submit a proposal and would not stand for re-appointment to the RDA engagement
upon the completion of RDA's audit for the fiscal year ended June 30, 2005.
KPMG's reports on RDA's consolidated financial statements for the fiscal years
ended June 30, 2004 and 2003 did not contain an adverse opinion or a disclaimer
of opinion and were not qualified or modified as to uncertainty, audit scope, or
accounting principles.
On August 29, 2005, KPMG presented an update to the RDA Audit Committee on the
status of the audits for the fiscal year ended June 30, 2005. KPMG has not
advised RDA that KPMG's reports on RDA's consolidated financial statements for
the fiscal year ended June 30, 2005 will contain an adverse opinion or a
disclaimer of opinion or will be qualified or modified as to uncertainty, audit
scope, or accounting principles. In addition, KPMG has not advised RDA that
KPMG's report on RDA management's assessment of the effectiveness of internal
control over financial reporting and the effectiveness of RDA's internal control
over financial reporting as of June 30, 2005 will contain an adverse opinion or
a disclaimer of opinion or will be qualified or modified as to uncertainty,
audit scope, or accounting principles. KPMG has advised RDA that KPMG expects to
deliver the above-mentioned reports to RDA by the end of this week.
During the fiscal years ended June 30, 2005 and 2004 and during the subsequent
interim period through August 23, 2005, there were no disagreements between RDA
and KPMG on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreement, if not
resolved to the satisfaction of KPMG, would have caused KPMG to make reference
to the subject matter of the disagreement in KPMG's reports. During the fiscal
years ended June 30, 2005 and 2004 and during the subsequent interim period
through August 23, 2005, there have been no "reportable events" (as defined in
Item 304(a)(1)(v) of Regulation S-K under the Securities Exchange Act of 1934).
RDA provided KPMG with a copy of this Form 8-K prior to filing it with the
Securities and Exchange Commission ("SEC"), and RDA requested KPMG to furnish
RDA with a letter addressed to the SEC stating whether KPMG agrees with the
foregoing statements made by RDA in response to Item 304(a) of Regulation S-K
and, if not, stating the respects in which KPMG does not agree. A copy of KPMG's
letter, dated August 29, 2005, furnished in response to RDA's request, is filed
as Exhibit 16.1 to this Form 8-K.
RDA will continue reviewing the proposals submitted by the other public
accounting firms that are participating in the review and will announce the
Audit Committee's selection of RDA's independent auditor for fiscal 2006 after
the process has been completed.
ITEM 9.01 Financial Statements and Exhibits.
(c) Exhibits
Filed herewith is the following:
Exhibit Number Description
16.1 Letter of KPMG LLP to the Securities and Exchange
Commission dated August 29, 2005.
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 hereunto duly authorized.
THE READER'S DIGEST ASSOCIATION, INC.
(Registrant)
Date: August 29, 2005
/s/ Michael S. Geltzeiler
Michael S. Geltzeiler
Senior Vice President and
Chief Financial Officer
EXHIBIT INDEX
Exhibit Number Description
16.1 Letter of KPMG LLP to the Securities and Exchange
Commission dated August 29, 2005.