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) March 23, 1998
MB Software Corporation
(Exact name of registrant as specified in its charter)
Colorado 0-11808 59-2219994
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(State or other jurisdiction (Commission File (IRS Employer
incorporation) Number) Identification No.)
2225 E. Randol Mill Road Suite 305, Arlington, Texas 76011
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 817-633-9400
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Item 4. Change in Registrant's Certifying Accountant
a)(1) Dismissal of Independent Accountant
(i) On February 27, 1998, the Registrant advised Hein + Associates,
LLP that the Registrant intended to retain a different
independent accounting firm for the audit of its financial
statements for the year ending December 31, 1997. Hein +
Associates, LLP had been engaged as the principal accountants to
audit the Registrant's financial statements.
(ii) Hein + Associates, LLP had not issued an opinion on any of the
Registrant's financial statements for any of the preceding two
years.
(iii)(B) The change of principal auditor for Registrant's financial
statements for the year ended December 31, 1997 was approved by
consent by the board of directors. The Board of Directors was
informed of all the reasons for the change.
(iv) Hein + Associates had been retained by the Registrant as the
principle auditor for the Registrant's year ended December 31,
1997 and had not issued any type report on the Registrant's
financial statements for the years ended December 31, 1996 or
December 31, 1995. No disagreements existed between the
Registrant and Hein + Associates for the interim period through
February 27, 1997, (the date of termination). Hein + Associates,
LLP raised issues regarding historical treatment of booking of
income received pursuant to a promissory note, justification of
goodwill balances and collectibility and write downs of accounts
receivable, which issues would require substantial investigation
by Hein + Associates, an expansion of the scope of the audit and
the incurrence of fees by the Registrant substantially in excess
of the fees initially quoted by Hein + Associates. The Registrant
believes its historical financial statements are accurate and
does not believe additional investigation to be warranted with
respect to any of the issues raised. Hein + Associates is
authorized to discuss all matters with the successor auditor. At
the time of dismissal, no additional investigation was conducted
with respect to any of these matters.
a(2) Engagement of New Independent Accountant
(i) As of March 10, 1998, the Registrant has retained Killman,
Murrell & Company, P.C., as the new Auditors.
a(3) Request for response from former Principal Accountant
(i) Exhibit 1 to this Form 8-K.
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Item 5. Other Matters
On March 6 1998, Thomas Mark Wilkins, Chief Financial Officer and
Director of the Company resigned from all positions with the Company
and its subsidiaries, citing differences with positions taken by the
Company in connection with its public disclosures. Mr. Wilkins was
responsible for the hiring of Hein + Associates and the Company
believes his resignation was related to the Company's unwillingness to
pay for the additional investigations required by Hein.
Item 7. Financial Statements and Exhibits
Exhibit Number Description
Exhibit 1 Letter from Hein + Associates, LLP to the
Securities and Exchange Commission pursuant to
Item 304(a)(3)of Regulation S-K.
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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 hereunto duly authorized.
MB Software Corporation
Date: March 23, 1998
/s/Scott A. Haire
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Scott A. Haire, Chairman of the Board,
Chief Executive Officer
And President (Principal Financial
Officer)
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INDEX TO EXHIBITS
Exhibit Number Description
Exhibit 1 Letter from Hein + Associates, LLP to the
Securities and Exchange Commission pursuant to
Item 304(a)(3) of Regulation S-K.
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HEiN +ASSOCIATES LLP
Certified Public Accountants and Consultants
with offices in Denver, Houston and Los Angeles.
Telephone (972) 458-2296 Fax (972) 788-4943
12770 Coit Road, Suite 1150 Dallas, Texas 75251
March 1O, 1998
Securities and Exchange commission
450 Fifth Street
Washington D.C. 20549
Gentlemen:
We have read Item 4 of the MB Software Corporation Form 8 K (Commission File No.
0-11808) dated March 4, 1998. We do not disagree with the comments made
regarding us, however, we have the following additions and clarification with
respect to the comments made:
With respect to Regulation SK Item 304 (a) (1)(v)(C), we advised the Registrant
that information had come to our attention that if further investigated may have
materially impacted the fairness or reliability of previously issued quarterly
financial statements and the year end financial statements under audit. The
items of which we advised the Company were as follows:
1. $400,000 of income was recorded on a $400,000 note receivable for the sale
of a dental practice. We advised the Company the transaction appeared to be
an installment sale and that some amount of basis in the sold asset should
be removed from the Company's books.
2. A reduction in the carrying value of certain healthcare accounts
receivable, that appeared to be recorded gross of expected credit
adjustments, would be necessary.
3. Collectibility concerns existed with respect to in excess of $1 million of
accounts receivable of an acquired business.
4. Goodwill balances in excess $1 million would need to be justified in
accordance with SFAS No. 121. especially in light of the Company's
apparently material operating losses incurred in 1997.
Very truly yours,
/s/ Hein+Associates LLP
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HEIN+ASSOCIATES LLP
Member of MOORES ROWLAND INTERNATIONAL with associated firms throughout the
world.
