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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
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FORM 8-K/A
Amendment No. 2
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Action of 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): SEPTEMBER 2, 2003
MERA PHARMACEUTICALS, INC.
(FORMERLY AQUASEARCH, INC. )
(Exact name of Registrant as specified in its charter)
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DELAWARE 33-23460-LA 04-368-3628
(State or other jurisdiction of (Commission File (IRS Employer Identification
incorporation or organization Number) Number)
777 SOUTH HIGHWAY 101, SUITE 215
SOLANA BEACH, CALIFORNIA 92075
(858) 847-0747
(Address and telephone number of principal executive offices)
73-4460 QUEEN KA'AHUMANU HIGHWAY, SUITE 110
KAILUA-KONA, HAWAII 96740
(808) 326-9301
(Address and telephone number of principal operations offices)
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ITEM 4. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT
On September 2, 2003 the Company engaged Jewett, Schwartz & Associates
("Jewett Schwartz") to audit its financial statements. The decision to engage
Jewett Schwartz was approved by the audit committee of the Company's board of
directors and ratified by the full Board.
Prior to its engaging Jewett Schwartz, the Company's financial statements
were audited by Buttke, Bersch and Wanzek, PC ("Buttke Bersch"). On September 5,
2003 the Company notified Buttke Bersch that it had been dismissed as the
Company's principal accountants. Buttke Bersch was initially engaged by the
Company on January 16, 2002. During its engagement, Buttke Bersch audited the
Company's financial statements for the fiscal years ended October 31, 2001 and
2002, and reviewed the Company's periodic filings on Form 10-Q and its current
filings on Form 8-K. During the period of January 16, 2002 through September 5,
2003, there were no disagreements between the Company and Buttke Bersch on any
matter of accounting principles or practices, financial statement disclosure or
auditing scope or procedure, which disagreement(s), if not resolved to the
satisfaction of Buttke Bersch, would have caused Buttke Bersch to make a
reference to the subject matter of the disagreement(s) in connection with its
audit of the Company's financial statements or its review of any periodic
filings.
Buttke Bersch's reports on the Company's financial statements for the
years ended October 31, 2001 and 2002 did not express any adverse opinions or
disclaimers of opinion or qualification or modification as to uncertainty, audit
scope or accounting principles. Buttke Bersch did express uncertainties about
the Company's ability to continue as a going concern in its audit reports for
the fiscal years ended October 31, 2001 and 2002.
During the interim period ended January 31, 2003, Buttke Bersch
provided the Company with comments and suggestions on the effectiveness of the
Company's controls and procedures. Based on this evaluation and review, our
chief executive officer and controller concluded that certain deficiencies
related to the lack of segregation of conflicting duties with respect to cash
and sales exist. Specific deficiencies in the cash area were that the interim
controller performed conflicting duties of opening mail, receiving and
disbursing monies, posting payments and performing bank reconciliations.
Specific deficiencies in the sales area were that the sales associate authorized
and initiated the approval of sales orders, facilitated inventory shipment,
determined certain sales pricing and maintained inventory. These deficiencies
existed primarily as a result of the Company's small staff, making segregation
of duties difficult. However, they have been addressed and corrected by the
Company through changes in internal controls described below. The identified
deficiencies did not result in any known errors or the need to make any
financial adjustments.
In order to address the deficiencies determined to exist by the
Company's chief executive officer and controller, as discussed above, the
Company changed certain of its internal controls related to the segregation of
duties. In the cash area, the Company changed its internal controls to replace
the interim controller as a bank account signatory with an employee who does not
perform conflicting functions. The Company implemented that corrective action in
February 2003. In the sales area, the Company changed its internal controls to
require that the sales associate receive approval from the president of the
Company's nutraceuticals division for all sales orders above a certain minimum
quantity, and that another employee who does not perform conflicting functions
maintain inventory. The Company implemented those corrective actions in February
2003.
A copy of a letter from Buttke Bersch addressed to the Securities and
Exchange Commission stating whether Buttke Bersch agrees or disagrees with the
above statements is attached as an exhibit to this Report on Form 8-K.
MERA PHARMACEUTICALS, INC.
Dated: November 12, 2003 By: /s/ Daniel P. Beharry
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Daniel P. Beharry
Chief Executive Officer
EXHIBIT NUMBER DESCRIPTION
16.1 Letter regarding change in certifying accountant, dated
October 29, 2003