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 18, 1997
Mercury Finance Company
(Exact name of registrant as specified in charter)
Delaware 1-10176 36-3627010
(State of other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
100 Field Drive, Lake Forest, Illinois 60045
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (847) 295-8600
N/A
(Former name or former address, if changed since last report)
Item 4. Changes in Registrant's Certifying Accountant.
On February 18, 1997, Mercury Finance Company (the "Company") advised KPMG
Peat Marwick LLP ("KPMG") that the Company was discontinuing KPMG's services as
the Company's independent accountants and was engaging Arthur Andersen LLP
("Arthur Andersen") as the Company's independent accountants. The decision to
discontinue KPMG and to engage Arthur Andersen was approved by the Audit
Committee of the Board of Directors as well as by the Board of Directors as a
whole.
On January 29, 1997, the Company announced the discovery of accounting
irregularities with respect to previously reported results for fiscal years 1993
through 1996. Results for 1996 had recently been announced by the Company, but
KPMG had not completed its audit of the 1996 financial statements. In
connection with KPMG's incomplete audit, KPMG advised the Company that
information had come to its attention that the Company's previously announced
unaudited results for 1996 were materially misstated. In addition, KPMG advised
the Company that information had come to its attention that materially impacted
the fairness and reliability of the Company's previously issued 1995 financial
statements and the related audit report. KPMG further informed the Company that
information had come to its attention that, subject to further investigation,
may have caused KPMG to have been unwilling to rely on representations of
management employed at the time of discovery of the accounting irregularities.
As a result of its dismissal, KPMG did not complete such further investigation.
KPMG's reports on the financial statements of the Company for the fiscal
years ended December 31, 1994 and 1995 did not contain an adverse opinion or a
disclaimer of opinion and were not qualified or modified as to uncertainty,
audit scope or accounting principles.
To the knowledge of the present executive management and the Board of
Directors of the Company, in connection with the audits of the Company's
financial statements for each of the two fiscal years ended December 31, 1994
and 1995, and in the subsequent interim period, there were no disagreements with
KPMG on any matters of accounting principles or practices, financial statement
disclosure or auditing scope and procedure which, if not resolved to the
satisfaction of KPMG, would have caused KPMG to make reference to the matter in
its reports.
Arthur Andersen has been and continues to be engaged by legal counsel to
the Special Committee of the Board of Directors in connection with the
investigation of the previously announced accounting irregularities at the
Company.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Description of Document
16. Letter dated February 25, 1997, from KPMG Peat Marwick
LLP to the Securities and Exchange Commission.
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.
Mercury Finance Company
Date: February 25, 1997 By: /s/ Bradley S. Vallem
Its: Assistant Vice President
and Treasurer
EXHIBIT 16
February 25, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Ladies and Gentlemen:
We were previously principal accountants for Mercury Finance Company and, under
the date of February 12, 1996 (except as to certain notes to financial
statements as to which the date was October 23, 1996), we reported on the
consolidated financial statements of Mercury Finance Company and subsidiaries as
of December 31, 1995 and 1994 and for each of the years in the three year period
ended December 31, 1995. On February 18, 1997, our appointment as principal
accountants was terminated. We have read Mercury Finance Company's statements
included under Item 4 of its Form 8-K dated February 25, 1997, and we agree with
such statements, except that we are not in a position to agree or disagree with
Mercury Finance Company's statements that (a) the decision to discontinue KPMG
Peat Marwick LLP and engage Arthur Andersen LLP was approved by the Audit
Committee of the Board of Directors as well as by the Board of Directors as a
whole and (b) Arthur Andersen LLP has been and continues to be engaged by legal
counsel to the Special Committee of the Board of Directors in connection with
the investigation of the previously announced accounting irregularities at the
Company.
Very truly yours,
/s/ KPMG PEAT MARWICK LLP
