SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
Date of Report: June 25, 1999
HEALTHWATCH, INC.
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Exact Name of Registrant
9040 Roswell Road, Suite 470, Atlanta, Georgia 30350
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Address of Principal Executive Offices
(770) 641-5555
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Registrant's Telephone Number
Minnesota 0-11476 84-0916792
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(State of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
Former Name/Address: N/A
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ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
On June 4, 1999, HealthWatch, Inc. (the "Company") dismissed its
independent auditors, Silverman Olson Thorvilson & Kaufman LTD
("Silverman Olson"), and on the same date authorized the engagement of
Tauber & Balser, P.C. ("Tauber & Balser") as its independent auditors for
the fiscal year ended June 30, 1999. Tauber & Balser, was formally engaged
by the Company on June 4, 1999. Each of these actions were approved by the
Board of Directors of the Company. Because the Company recently relocated its
corporate headquarters to Atlanta, Georgia, the Board of Directors concluded
that it would be more economical to use a regional firm based in Atlanta,
such as Tauber & Balser, to perform its audit for the current fiscal year.
Tauber & Balser also acts as independent auditors for HALIS, Inc., an affiliate
of the Company, and in which the Company owns in excess of 20 percent of its
outstanding common stock.
Silverman Olson audited the financial statements for the Company for the
fiscal years ended June 30, 1998 and 1997. The reports of Silverman Olson on
the financial statements of the Company for the fiscal years ended June 30, 1998
and June 30, 1997 each contained an additional paragraph which modified each of
the reports to emphasize that Silverman Olson believed there was substantial
doubt about the Company's ability to continue as a going concern. Except as
set forth in the preceding sentence, the reports on those audits did not contain
any adverse opinions or a disclaimer of opinions, nor was it qualified as to
uncertainty, audit scope, and accounting principles.
In connection with the audit of the fiscal year ended June 30, 1998,
and for the unaudited interim period through June 4, 1999, there were no
disagreements with Silverman Olson on any matter of accounting principle or
practice, financial statement disclosure, or audit procedure or scope.
Additionally, Silverman Olson did not advise the Company that (i) the
internal controls necessary for the Company to develop reliable financial
statements did not exist; (ii) information had come to its attention
that led it to no longer be able to rely on management's representations,
or that made it unwilling to be associated with the financial statements
prepared by management; (iii) there existed a need to expand significantly
the scope of its audit, or that information had come to the attention of
Silverman Olson during the fiscal periods, which, if further investigated,
may (a) materially impact the fairness or reliability of either: a previously
issued audit report or the underlying financial statements, or the financial
statements issued or to be issued covering the fiscal period subsequent to
the date of the most recent financial statements covered by an audit report
(including information that may prevent it from rendering an unqualified
audit report on those financial statements), or (b) cause Silverman Olson
to be unwilling to rely on management's representations or be associated
with the Company's financial statements, and due to the dismissal of
Silverman Olsen, did not so expand the scope of its audit or conduct such
further investigation; or (iv) information had come to the attention of
Silverman Olson that it concluded materially impacts the fairness or
reliability of either (a) a previously issued audit report or the underlying
financial statements, or (b) the financial statements issued or to be issued
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covering the fiscal period subsequent to the date of the most recent financial
statements covered by an audit report (including information that, unless
resolved to the satisfaction of Silverman Olson would prevent it from
rendering an unqualified audit report on those financial statements), and due
to the dismissal of Silverman Olson, the issue has not been resolved to the
satisfaction of Silverman Olson prior to its dismissal.
Further, during the fiscal year ended June 30, 1998 and the unaudited
interim period through June 4, 1999, neither the Company nor any of its
representatives sought the advice of Tauber & Balser regarding 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.
The Company has requested that Silverman Olson furnish it with a letter
addressed to the Securities and Exchange Commission stating whether it agrees
with the above statements. A copy of Silverman Olson's letter to the
Securities and Exchange Commission is filed as Exhibit 16.1 to this Form 8-K.
ITEM 7. EXHIBITS.
(c) Exhibits:
The following exhibits are filed herewith:
16.1 - Letter regarding Change in Certifying Accountant.
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SIGNATURES
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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.
HEALTHWATCH, INC.
By: /s/ Paul W. Harrison
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Paul W. Harrison, Chairman and
President
Dated: June 25, 1999
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EXHIBIT INDEX
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Exhibit No. Description of Exhibit
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16.1 Letter regarding change in certifying accountant
Exhibit 16.1
[Letterhead of Silverman Olson
Thorvilson & Kaufman LTD]
Securities and Exchange Commission
450 5th Street, N.W.
Washington, D.C. 20549
Gentlemen:
We have read and agree with the comments in Item 4 of Form 8-K of HealthWatch,
Inc. dated June 25, 1999.
Sincerely yours
/s/ Silverman Olson Thorvilson & Kaufman LTD
Silverman Olson Thorvilson & Kaufman LTD
Minneapolis, Minnesota
June 28, 1999
