<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
October 10, 1997
------------------------------------------------
Date of Report (date of earliest event reported)
IN-HOUSE REHAB CORPORATION
----------------------------------------------------
Exact Name of Registrant as Specified in its Charter
Colorado 0-22155 84-0987697
- --------------------------- --------------- ----------------------
State or Other Jurisdiction Commission File IRS Employer Identifi-
of Incorporation Number cation Number
325 West Main Street, Suite 1400B, Louisville, Kentucky 40202
-------------------------------------------------------------
Address of Principal Executive Offices, Including Zip Code
(502) 568-8923
-------------------------------------------------
Registrant's Telephone Number, Including Area Code
<PAGE>
ITEM 4. CHANGES IN THE REGISTRANT'S CERTIFYING ACCOUNTANTS.
On October 10, 1997, In-House Rehab Corporation (the "Company") engaged
the firm of Strothman & Company PSC ("Strothman") as its independent
accountants for its fiscal year ended May 31, 1997, and to reaudit its
financial statements for the year ended May 31, 1996. Coopers & Lybrand
L.L.P. ("C&L"), which had served as the Company's independent accountants,
resigned on October 1, 1997. Information concerning the resignation of C&L
has previously been reported in a Report on Form 8-K dated October 1, 1997.
Neither the Company nor any person acting on its behalf consulted with
Strothman with regard to the application of accounting principles to a
specific completed or contemplated transaction, or the type of audit opinion
that might be rendered on the Company's financial statements.
Certain members of the Company's management contacted Strothman prior to
their being engaged as the new auditors for the Company. The Company's
management sought advice from Strothman to address the implications that the
Company was facing given that C&L had advised the Company that it may want to
consider dismissing them as the Company's auditors prior to the audit being
completed.
During the conversation between the Company's management and Strothman,
Strothman inquired as to why C&L would make such a suggestion. The Company's
management advised Strothman that it was management's opinion that it related
to the receivable due from Retirement Care Associates, Inc. ("RCA"). RCA is a
major customer and 27% shareholder of the Company.
Strothman advised the Company to continue to work with C&L to gain
resolution to the RCA receivable issue and to finalize the audit. The Company
continued to work with C&L through August and September of 1997 until C&L's
resignation on October 1, 1997.
The Company has requested that Strothman review the disclosures
contained herein and, if it desires to do so, provide the Company with a
letter addressed to the Securities and Exchange Commission containing any new
information, clarification of the Company's expressions of its views, or the
respects in which it does not agree with the statements made herein. However,
Strothman has not provided the Company with such a letter.
IN-HOUSE REHAB CORPORATION
Dated: October 17, 1997 By/s/ Robert J. Babine
Robert J. Babine,
Chief Financial Officer