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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): April 7, 1997
CLARK REFINING & MARKETING, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-11392 43-1491230
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
8182 Maryland Avenue 63105-3721
St. Louis, Missouri (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including are code: (314) 854-9696
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Item 4. Changes in Registrant's Certifying Accountant
Effective April 7, 1997, Clark Refining & Marketing, Inc. (the
"Company") dismissed Coopers & Lybrand L.L.P ("C&L") as its independent
accountant previously engaged to audit its financial statements. On
April 8, 1997, the Company engaged Price Waterhouse LLP ("PW") as its
independent accountant to audit its financial statements. C&L's report
on the Company's financial statements for the years ended December 31,
1995 and 1996 did not contain an adverse opinion or a disclaimer of
opinion and was not qualified or modified as to uncertainty, audit
scope, or accounting principles. The decision to change independent
accountants was approved by the Company's Board of Directors.
The following disagreements as contemplated by Item 304 (a)(1)(iv)
of Regulation S-K occurred during the two most recent fiscal years and
subsequent interim periods preceding the dismissal of C&L:
a) In December 1995, Clark USA, Inc. ("Clark USA"), the Company's
parent, acquired an advance crude oil purchase receivable from a
subsidiary of Occidental Petroleum (the "Oxy Receivable"). In
connection with its audit for the year ended December 31, 1995, C&L
required Clark USA to obtain an independent appraisal of the
receivable. Clark USA believed such an independent appraisal was
unnecessary due to readily available alternative valuation methods
and the arms-length nature of the transaction. However, Clark USA
obtained the required independent appraisal which confirmed Clark
USA's original valuation. The Oxy Receivable was sold in October 1996
for a gain of $10.9 million.
b) In December 1995, Clark USA filed a registration statement for its 10
7/8% Notes with the Securities and Exchange Commission. As a result
of a review of this registration statement by the Commission, Clark
USA was required to change the accounting treatment for the Oxy
Receivable from the pro forma accounting information presented in a
private placement offering circular. The economic substance of the
Oxy Receivable was not impacted by this change. However, C&L
required Clark USA to disclose Clark USA's evaluation of the impact
of this accounting change. Clark USA provided disclosure which
indicated Clark USA believed the different accounting treatment would
not have a material adverse effect on Clark USA's financial position
or results of operations.
c) During 1996, the Company accounted for fixed purchase and sale
commitments on a mark to market basis for interim reporting. C&L
assisted the Company in evaluating the use of this method in 1996,
but determined that it was not appropriate. The Company ultimately
agreed with this conclusion and as a result, did not utilize this
method in the financial statements of the Company for the year ended
December 31, 1996. The utilization of this method for interim
reporting did not result in a material impact on the consolidated
financial statements for any interim period.
d) During 1996, the Company evaluated its ability to realize its
alternative minimum tax ("AMT") credit carryforward. For the year
ended December 31, 1996, C&L concluded that a valuation reserve
against this AMT credit carryforward was required and the Company
ultimately concurred.
Neither the Board of Directors nor a subcommittee of the Board of
Directors discussed these disagreements with C&L. C&L has been
authorized to fully respond to any inquiries from PW regarding these
matters.
During the years ended December 31, 1995 and 1996 and subsequent
interim periods, there were no reportable events as defined under Item
304 (a)(1)(v) of Regulation S-K and the Company did not consult with PW
regarding the application of accounting principles to a specified
transaction, or regarding the type of audit opinion that might be
rendered on the Company's financial statements or any disagreements as
defined in Item 304 (a)(2)(i) and Item 304 (a)(2)(ii) of Regulation S-K,
except as noted below:
1. PW was not consulted regarding the need for an independent appraisal
of the Oxy Receivable as discussed in a) above. Clark USA requested
PW to gather information regarding industry practice for the
accounting for transactions similar to the Oxy Receivable. Clark USA
did not request PW to
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express an opinion and PW was not engaged to, and did not provide an opinion
on the accounting for this transaction. PW shared publicly available
information with Clark USA regarding certain significant factors considered
by another company in evaluating the accounting treatment for a transaction
with certain similar features.
2. The Company requested PW to gather information regarding industry
practice for the accounting for fixed commitments as discussed in c)
above. The Company did not request PW to express an opinion and PW
was not engaged to, and did not provide an opinion on the accounting
for fixed commitments. After conducting an industry survey, PW
advised the Company that no companies in the survey were utilizing
this accounting treatment.
PW was given the opportunity to review the disclosures in Item 4 of this
Form 8-K.
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EXHIBIT INDEX
16.1 Letter from Coopers & Lybrand L.L.P. dated April 15, 1997
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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: April 17, 1997 CLARK REFINING & MARKETING, INC.
By: /s/ Dennis R. Eichholz
Dennis R. Eichholz
Controller and Treasurer
Exhibit 16.1
[Coopers & Lybrand Letterhead]
April 15, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Gentlemen:
We have read the statements made by Clark Refining & Marketing, Inc. (copy
attached), which we understand will be filed with the Commission, pursuant to
Item 4 of Form 8-K, as part of the Company's Form 8-K report for the month
of April 1997. We agree with the statements concerning our Firm in such 8-K.
We agree with the statements concerning our Firm in such 8-K, except that we
were previously informed that the requisite number of Board resolutions of
Clark USA, Inc. "the Company's parent" confirming our dismissal were received
on April 4, 1997.
Very truly yours,
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
mrl/ymf
Attachment
