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__________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________
FORM 8-K/A-3
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
__________________________
Date of Report (Date of earliest event reported) November 3, 1998
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PHYSICAL SPA & FITNESS, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
0-26573 98-0203281
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(Commission File Number) (IRS Employer Identification No.)
12/F-15/F Lee Theatre Plaza, 99 Percival St., Causeway Bay, Hong Kong
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (852) 2572-8888
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ITEM 4. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT.
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The Board of Directors of the Registrant approved the engagement of
William D. Lindberg, CPA on June 2, 1999 to serve as the Registrant's
independent public auditor and to conduct the audit of the Company's financial
statements for the fiscal years ended 1996, 1997 and 1998. The decision to
change the certifying accountant was made by the Board of Directors of the
Registrant, and resulted from the fact that on November 3, 1998, Arthur Andersen
withdrew its previously issued audited reports for the years ended December 31,
1997 and December 31, 1996. The Registrant sent a termination letter to Arthur
Andersen dated November 3, 1998, and Arthur Andersen sent a resignation letter
to the Registrant dated as of the same date.
The audit reports provided by Arthur Andersen for the fiscal years
ended December 31, 1996 and 1997 did not contain any adverse opinion or
disclaimer of opinion nor was any report modified as to uncertainty, audit scope
or accounting principles. There were discussions between Arthur Andersen and the
Registrant with respect to the related party nature of certain transactions and
related disclosures undertaken by certain subsidiaries of the Registrant in the
fiscal year ended December 31, 1996. However, Arthur Andersen has never made any
recommendations to the Registrant as to what changes in the disclosure should be
made by the Registrant. Due to the fact that the relationship between Arthur
Andersen and the Registrant ceased as of November 3, 1998, the matter regarding
the related party transaction was never resolved to their satisfaction prior to
November 3, 1998.
Upon appointment of William D. Lindberg, CPA, the Registrant authorized
the former accountant, Arthur Andersen, to respond fully to the inquiries of the
successor accountant concerning the issue of the related party transaction with
respect to the fiscal year ended December 31, 1996.
Except as disclosed above, there have been no other past disagreements
between the Registrant and Arthur Andersen on any matter of accounting
principles or practices, financial statement disclosure or auditing, scope or
procedure for the fiscal years ended December 31, 1996, December 31, 1997 and
the interim period ended November 3, 1998.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
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(c) Exhibits
16.1 Letter from Arthur Andersen & Co., to the SEC.
16.2 Letter from William D. Lindberg, CPA to the SEC.
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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.
Dated: September 17, 1999 PHYSICAL SPA & FITNESS, INC.
By: /S/ Ngai Keung Luk
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Ngai Keung Luk
Chairman and Chief Executive Officer
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EXHIBIT 16.1
Arthur Andersen & Co.
Certified Public Accountants
21/F Edinburgh Tower The Landmark
15 Queen's Road Central
Hong Kong
Tel. 852 2852 0222
Fax. 852 2815 0548
September 17, 1999
Securities and Exchange Commission
450 Fifth Street N.W.
Washington, D.C. 20549
USA
Dear Sirs:
We have read Item 4 of the Report on Form 8-K/A-3 of Physical Spa & Fitness,
Inc. and we agree with statements contained therein as they relate to our firm.
Very truly yours,
/s/Arthur Andersen & Co.
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EXHIBIT 16.2
William D. Lindberg
Certified Public Accountant
1064 Clipper Court
Costa Mesa, California 92627
Tel./Fax. (949) 548-6546
September 17, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
I have read Item 4 of the Report on Form 8-K/A-3 of Physical Spa &
Fitness, Inc. and I agree with statements contained therein as they relate to my
firm. I discussed with Arthur Andersen the issue of related party transaction
with respect to fiscal year ended December 31, 1996, and inquired what changes
they recommended in the disclosure in the financial statements for that year.
Arthur Andersen & Co., indicated that they have not studied the issue in depth
and they were not in a position to make any recommendations as to any changes in
the financial statements for fiscal year ended December 31, 1996, or for any
other year on which they had rendered an opinion.
Very truly yours,
/s/William D. Lindberg
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