IEA INCOME FUND VIII
8-K, 1997-02-07
WATER TRANSPORTATION
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<PAGE>   1





                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549



                                    FORM 8-K

                                 CURRENT REPORT

                        PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


      Date of Report (date of earliest event reported):  February 3, 1997



                              IEA INCOME FUND VIII
             (Exact name of registrant as specified in its charter)



<TABLE>
<S>                                  <C>                      <C>  
         California                         0-17942               94-3046886
(State or other jurisdiction                                  (IRS Employer
of incorporation or organization)    (Commission File No.)    Identification No.)
</TABLE>


        444 Market Street, 15th Floor, San Francisco, California  94111
                (Address of principal executive offices)        (zip code)

      Registrant's telephone number, including area code:  (415) 677-8990
<PAGE>   2
Item 4.          Changes in Registrant's Certifying Accountant.

                 (a)      On February 3, 1997, Arthur Andersen, London,
England, resigned as auditors of The Cronos Group, a Luxembourg corporation
headquartered in Orchard Lea, England (the "Parent Company") (NASDAQ -- CRNSF).
The Parent Company is the indirect corporate parent of Cronos Capital Corp.,
the General Partner of the Registrant.  In its letter of resignation, Arthur
Andersen states that it was unable to obtain adequate information in response
to inquiries it had made in connection with its audit of the Parent Company for
the year ended December 31, 1996.  In connection with its resignation,  Arthur
Andersen also prepared a report pursuant to the provisions of Section 10A(b)(2)
of the Securities Exchange Act of 1934, as amended, for filing by the Parent
Company with the SEC.  In this report, Arthur Andersen explains, based upon the
information it then had available, that:

                          (i)     A disbursement of $1.5 million by the Parent
Company and subsequent correspondence from the Parent Company's bank concerning
the repayment of the disbursement to the Parent Company may have violated laws
and regulations to which the Parent Company is subject, including U.S.
securities laws, and that these matters may have a material effect upon the
1996 financial statements of the Parent Company;

                          (ii)    Senior management of the Parent Company had
not taken, and the Board of Directors of the Parent Company had not caused
senior management to take, timely and appropriate remedial actions with respect
to these matters; and

                          (iii)   The circumstances of these matters and
failure to take remedial action warranted Arthur Andersen's resignation as
outside auditors of the Parent Company.

                  In its letter of resignation to the Parent Company, Arthur
Andersen states that it is resigning as auditors of the Parent Company and of
all other entities affiliated with the Parent Company.  While its letter of
resignation is not addressed to the General Partner or the Registrant, Arthur
Andersen has confirmed to the General Partner that its resignation as auditors
of the entities referred to in its letter of resignation can be read to include
Cronos Capital Corp. and the Registrant.

                  The General Partner also understands that the three outside
directors on the Parent Company's six-member Board of Directors have resigned.

                  The Registrant does not, at this time, have sufficient
information to respond to the concerns raised by Arthur Andersen with respect to
its 1996 audit of the Parent Company.  However, the General Partner of the
Registrant does not believe, based upon the information currently available to
it, that Arthur Andersen's resignation was triggered by any concern over the
accounting policies and procedures followed by the Registrant.

                 (b)      The Registrant has yet to retain a new auditor.
<PAGE>   3
Item 5.          Other Events.

                 See Item 4 above.


Item 7.          Financial Statements and Exhibits.

                 (a)      Financial statements of businesses acquired.  Not
                          applicable.

                 (b)      Pro forma financial information.  Not applicable.

                 (c)      Exhibits.

                          16.1    Letter of resignation from Arthur Andersen to
                                  the Board of Directors of the Cronos Group,
                                  dated February 3, 1997.

                          16.2    Report of Arthur Andersen pursuant to Section
                                  10A(b)(2) of the Securities Exchange Act of
                                  1934, as amended, dated February 3, 1997,
                                  addressed to the Board of Directors of the
                                  Cronos Group.




                                   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.


                                         IEA INCOME FUND VIII

                                         By:    CRONOS CAPITAL CORP.
                                                The General Partner



                                         By:    /s/  DENNIS J. TIETZ
                                                -------------------------------
                                                Dennis J. Tietz
                                                President



Date:  January 7, 1997
<PAGE>   4
                                 EXHIBIT INDEX



<TABLE>
<CAPTION>
Exhibit
   No.                                 Description                                   Method of Filing
- --------                               -----------                                   ----------------
 <S>                 <C>                                                             <C>
 16.1                Letter of resignation from Arthur Andersen to the Board of      Filed with this document
                     Directors of the Cronos Group, dated February 3, 1997.

 16.2                Report of Arthur Andersen pursuant to Section 10A(b)(2)         Filed with this document
                     of the Securities Exchange Act of 1934, as amended, dated
                     February 3, 1997, addressed to the Board of Directors of
                     the Cronos Group.
</TABLE>

<PAGE>   1
                                                                  EXHIBIT 16.1



                                     ARTHUR
                                    ANDERSEN


                                                         -----------------------
                                                         1 Surrey Street
                                                         London WC2R 2PS
                                                         0171 438 3000 Telephone
                                                         0171 831 1133 Facsimile
3 February 1997

The Board of Directors
The Cronos Group
35 Rue Glesener
L-1631 Luxembourg

Dear Sirs:

We have concluded that we have not received a satisfactory response from the
Board to our letters of 9 January 1997, 16 January 1997, and 24 January 1997.
The "collective response from the Board" contained in the letter to us dated 28
January 1997 and signed by Mr. Eriksen on behalf of himself and Mr. Palatin did
not appropriately address or explain the issues and inconsistencies which were
set out in our letters.  We were subsequently informed by Mr. Palatin in a
telephone conversation on 31 January 1997 that no further explanations would be
forthcoming or investigations undertaken.

Since we have been, and continue to be, unable to obtain the information and
explanations we require for the purposes of our 31 December 1996 audit of the
Group, the circumstances no longer exist in which we will be able to perform
such an audit in accordance with generally accepted auditing standards.
Further, as we informed you in our previous letters, we are now obliged to
submit a report to you pursuant to our obligations under Section 10A(b)(2) of
the United Stated Securities Exchange Act of 1934, as amended by Title III of
the United States Private Securities Litigation Reform Act of 1995.

Accordingly:

1       We hereby resign with immediate effect as auditors of the consolidated
        Cronos Group and of its holding company, The Cronos Group societe 
        anonyme, and of all other entities within the Cronos Group.

2       We enclose the report referred to above arising from our
        responsibilities under US Federal securities laws.  The Board is
        required to notify the United States Securities and Exchange Commission
        of the receipt and contents of this report, together with certain other
        specified information, not later than one business day after the report
        has been received and to provide us with a copy of such notice.  We
        assume that the Board will be taking US legal advise as to the
        fulfilment of its reporting obligation.



Yours faithfully



ARTHUR ANDERSEN



<PAGE>   1
                                                                   EXHIBIT 16.2
                                     ARTHUR
                                    ANDERSEN


                                                       -----------------------
                                                       PO Box 55
                                                       1 Surrey Street
                                                       London WC2R 2NT
                                                       0171 438 3000 Telephone
                                                       0171 831 1133 Facsimile

                                                       Direct line 0171 438 3120
                            
3 February 1997

The Board of Directors
The Cronos Group
35 Rue Glesener
L-1631 Luxembourg


                            PRIVATE AND CONFIDENTIAL

Dear Sirs

RE:     Report Required by Section 10A(b)(2) of the United States Securities
        Exchange Act of 1934, as Amended by Title III of the United States
        Private Securities Litigation Reform Act of 1995

We are submitting this report to you in response to our obligations under
Section 10A(b)(2), of the US Securities Exchange Act of 1934, as amended by
Title III of the US Private Securities Litigation Reform Act of 1995.

We refer to our letter of 24 January 1997 to the Board concerning certain
matters which have come to our attention during the course of our audit at 31
December 1996, and for which we have been unable to obtain satisfactory
explanation and support. In our letter of 24 January 1997, we stated that we
require a response from the Board on the matters referred to in our letters of
9 January 1997 and 16 January 1997, by 5pm on Tuesday, 28 January 1997 (London
time). We have considered the information received and conclude that we have
not received a response that appropriately addresses the matters cited in those
communications. Accordingly, as we previously informed you, we are required by
US Federal securities laws to submit this report to you.

We have concluded, based on the information we have as of the date of this
letter, that

(a)     The disbursement of US $1.5 million and the subsequent correspondence
        from National Westminster Bank concerning repayment of that disbursement
        (copies of which you have previously received) may have violated laws
        and regulations to which Cronos is subject, including US Federal
        securities laws, and that these matters may have a material effect on
        the 1996 financial statements of Cronos.

(b)     Senior management has not taken, and the Board of Directors has not
        caused senior management to take, timely and appropriate remedial
        actions with respect to these matters; and
<PAGE>   2
                          [ARTHUR ANDERSEN LETTERHEAD]

                                      -2-
The Board of Directors                                           3 February 1997

(c)     The circumstances of these matters and failure to take remedial action
warrants our resignation from the engagement and we have so resigned.

By receipt of this report, we hereby advise you that under Section 10A(b)(3) of
the Securities Exchange Act of 1934, the Board is required to inform the US
Securities and Exchange Commission by notice not later than one business day
after receipt of this report that this report has been received, and provide us
with a copy of such notice.

Under Section 10A(b)(3), if we do not receive a copy of the notice referred to
above by close of business UK time on 4 February 1997 we are required to, and
will furnish a copy of this report to the SEC within one business day
following failure to receive notice.

Yours faithfully

/s/ Arthur Andersen
- ----------------------


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