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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (date of earliest event reported): September 5, 2000
TECHNOLOGY FUNDING VENTURE CAPITAL FUND VI, LLC.
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(Exact name of Registrant as specified in its charter)
Commission File No. 814-124
Delaware 94-3266666
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2000 Alameda de las Pulgas, Suite 250
San Mateo, California 94403
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(Address of principal executive offices) (Zip Code)
(650) 345-2200
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(Registrant's telephone number, including area code)
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Item 4. Changes in Registrant's Certifying Accountant.
The Fund has received a letter from KPMG LLP dated September 20, 2000 in
response to its request that KPMG LLP furnish a letter stating whether
or not they agree with the statements made in our Form 8-K filed on
September 12, 2000. The letter which is included in Item 7 below
contains the following factual errors:
General: KPMG LLP's letter refers to the Fund's "Managing General
Partners." The Fund is organized as a limited liability company and has
no general or limited partners. Therefore, the reference is not clear.
As to Paragraph 2, Sentence 1: KPMG LLP was not precluded from
completing its review of the unaudited June 30, 2000 financial
statements. In fact, the Fund, on its own initiative, engaged an
independent third party to provide guidance to the Investment Managers
regarding the Fund's Valuation Policy. That report was available in a
draft form on Saturday, August 12, 2000 and in final, signed form
including the specific reference allowing KPMG LLP to rely on said
report on August 14, 2000. As detailed below, the Investment Managers
responded fully to all requests for documentation and, in fact, have
made documentation available to KPMG LLP so that the review could be
completed.
As to Paragraph 2, Sentence 2: At no time prior to Saturday, August 12,
2000, did KPMG LLP inform us that they would require any evidential
material from any independent third party in order to complete their
review of the June 30, 2000 financial statements. Contrary to the
statement in KPMG LLP's letter, the oral advice was that an independent
appraisal would be required if KPMG LLP were asked to perform an interim
audit related to a proposed transaction which would require audited
financial statements to be included in an SEC filing. This oral advice
was not related in any way to the review of the June 30, 2000 financial
statements.
As to Paragraph 2, Sentences 3, 4, 5 and 6: During conference calls on
August 8 and 10, 2000 which included the KPMG LLP engagement partners as
well as other KPMG LLP partners, we identified and listed the
credentials of the independent third party retained by the Fund and
described the nature of the documentation to be obtained from
independent third parties which documentation would be one of the
factors the Investment Managers would rely upon in valuing securities in
good faith as of June 30, 2000. While we believe the documentation
adequately supports the fair values determined by the Investment
Managers, at no time did we represent to KPMG LLP that it would
constitute adequate documentation for their purposes since they had made
no request prior to August 12, 2000 for any evidential material from any
independent third party in order to complete their review of the June
30, 2000 financial statements. Since no documentation had been
requested by KPMG LLP for their use, the original terms of our
engagement with the third party prevented us from distributing their
report to anyone other than the Investment Managers and Independent
General Partners of the Fund. In an effort to be responsive to KPMG
LLP's August 12, 2000 request, KPMG LLP's partner on site was
immediately given the opportunity to review the draft report. As
described in the Form 8-K filed on September 12, 2000, the terms of our
engagement with the third party were revised in order to respond to KPMG
LLP's request made on August 12, 2000 and the report, which does not
differ in substance or conclusion from the draft read by the KPMG LLP
partner prior to our 10-Q filing except to include a statement that KPMG
LLP could rely on said report, was issued in final form on August 14,
2000.
As to Paragraph 2, Sentence 9: On August 12, 2000, when the KPMG LLP
partner informed the Fund's Controller that they would not be able to
complete the review unless the final signed version of the report was
received with the statement that KPMG LLP could rely on that report, the
Controller asked the KPMG LLP partner what the consequences would be of
their not completing the review. He stated that there were none other
than that they would be unable to issue a report on the review until
they had the independent third party's draft report in a final form
which was acceptable to them. The terms of KPMG LLP's quarterly review
engagement did not call for the issuance of a report. He further stated
that in the event we decided we would need a report, they would be able
to issue one when the independent third party's final report was made
available to them. At no time on August 12, 2000, did the KPMG LLP
partner inform the Controller, or anyone else affiliated with the
Investment Managers, that the non-completion of the review would result
in either a reportable event under Regulation S-K or in their
resignation. On August 31, 2000, we asked KPMG LLP whether there was a
disagreement or reportable event which should be addressed in the Form
8-K; the KPMG LLP partner stated that he didn't know at that time. On
September 5, 2000, the KPMG LLP partner informed us that they believed
there was no disagreement but the non-completion of the quarterly review
constituted a reportable event.
As to Paragraph 3, Sentence 2: KPMG LLP did not indicate in the August
30, 2000 conversation that they would complete the June 30, 2000 review
prior to resigning. In fact, the documentation requested on August 12,
2000 has been offered to them and they have refused to complete the
review.
There was, however, discussion on August 30, 2000 of one uncompleted
matter which KPMG LLP agreed to complete. That project is ongoing and
is expected to be completed within the next two weeks. In connection
with their engagement as our independent accountants in 1999, they were
to complete the three security counts required by Rule 17f-2 (f) of the
Investment Company Act of 1940. On August 22, 2000, we were provided
their reports on the 1999 security counts and learned that they had
performed only two of the required three counts during 1999. On August
30, 2000, as well as several occasions previously, KPMG LLP had promised
to determine how to remedy their failure to perform three counts and
what filings, if any, might be required. To date, they have not
informed us of their conclusions.
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Item 7. Exhibits
Exhibit No. Description
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16 Letter from KPMG LLP dated September 20, 2000.
SIGNATURE
Pursuant to the requirement 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.
Technology Funding Venture Capital Fund VI, LLC.
By: Technology Funding Inc.
Technology Funding Ltd.
Investment Managers
Date: September 25, 2000 By: /s/ Charles R. Kokesh
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Charles R. Kokesh
President, Chief Executive Officer,
Chief Financial Officer and Chairman
of Technology Funding Inc. and
Managing General Partner of
Technology Funding Ltd.
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Exhibit 16
[LETTERHEAD OF KPMG LLP]
September 20, 2000
United States Securities and
Exchange Commission
Washington, DC 20549
Re: Technology Funding Venture Capital Fund VI, LLC
Ladies and Gentlemen:
We were previously principal accountants for Technology Funding Venture
Capital Fund VI, LLC., and, under date of March 29, 2000, we reported on
the financial statements of Technology Funding Venture Capital Fund VI,
LLC as of and for the years ended December 31, 1999 and 1998. On
September 1, 2000, we resigned. We have read Technology Funding Venture
Capital Fund VI, LLC's ("the Fund") statements included under Item 4 of
its Form 8-K dated September 12, 2000, and we agree with such
statements, except that we are not in a position to agree or disagree
with Item 4(a)(iii) and except for certain matters included within Item
4(a)(v). We believe the following is a more accurate description of the
events leading to the resignation of KPMG LLP.
KPMG LLP was precluded from completing its review of the unaudited June
30, 2000 financial statements included in the Registrant's 10-Q filing
on August 14, 2000. On or about late July or early August 2000, KPMG
LLP orally advised the Fund's Managing General Partners that KPMG LLP
would be unable to complete its review of the unaudited June 30, 2000
financial statements unless KPMG LLP was provided with competent
evidential material from an independent third party supporting the
valuation of the investments reflected in the Fund's unaudited financial
statements for the period ended June 30, 2000. On or about August 11,
2000, KPMG LLP was advised by the Managing General Partners of the Fund
that they were expecting documentation from an independent third party
which the Managing General Partners of the Fund believed would
constitute sufficient competent evidential material to support the
valuation of the investments reflected in the Fund's unaudited financial
statements for the period ended June 30, 2000. On August 12, 2000, a
KPMG LLP partner was provided a document, purporting to be a draft
report from an independent third party, which the Managing General
Partners' Controller stated constituted the requested support. Although
KPMG LLP had been previously orally advised of the identity of the third
party, the document presented to the partner appeared to be in draft
format, was not presented on pre-printed stationery, and did not have a
signature block or otherwise disclose the identity of the preparer.
Additionally, the draft report indicated that its distribution and
reliance upon it was restricted to the addressee. The Managing General
Partners' Controller stated that KPMG LLP could not copy the draft
report. The KPMG LLP partner informed the Managing General Partners'
Controller that if the Fund wished KPMG LLP to consider this document as
an independent third party's support for the Fund's valuation of
investments, the report would have to be finalized, printed on the third
party's stationery, duly executed and the report could not be
restricted. The KPMG LLP partner did not state whether the report, if
finalized, would be sufficient evidence to allow KPMG LLP to complete
its review. KPMG LLP was not provided a final signed report prior to
the Registrant filing its Form 10-Q for the period ended June 30, 2000.
On August 14, 2000, KPMG LLP issued a letter to the Registrant stating
that KPMG LLP had been unable to complete the review of the Registrant's
unaudited June 30, 2000 financial statements.
On August 30, 2000, KPMG LLP advised the Registrant that upon further
consideration, the Fund's Managing General Partners would have to
provide KPMG LLP appraisals by an independent third party for each
significant investment to support the valuation of investments reflected
in the Fund's June 30, 2000 unaudited financial statements in order for
KPMG LLP to complete its review. KPMG LLP also advised the Managing
General Partners of the Fund on that date orally of its intent to resign
as the Fund's independent accountant subsequent to the completion of its
review of the Fund's unaudited June 30, 2000 financial statements. The
Fund indicated its intent to engage successor accountants. KPMG LLP
subsequently issued a letter resigning as independent accountants for
the Fund.
Very truly yours,
/s/ KPMG LLP
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KPMG LLP
