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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 (Date of earliest event reported): September 17, 1998
THE CERPLEX GROUP, INC.
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(Exact name of registrant as specified in charter)
Delaware 0-9725 75-1539534
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1382 Bell Avenue, Tustin, California 92780
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(Address of principal executive offices) (Zip Code)
(714) 258-5300
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(Registrant's telephone number including area code)
Not Applicable
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(Former name or former address, if changed since last report.)
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ITEM 4. CHANGES IN REGISTRANTS' CERTIFYING ACCOUNTANT.
(a) Previous independent accountants
(i) On September 16, 1998, The Cerplex Group, Inc., formerly
Aurora Electronics, Inc., (the "Company") dismissed Arthur
Andersen LLP ("Arthur Andersen") as its independent accountants.
(ii) The reports of Arthur Andersen on the financial statements of
the Company for the past two fiscal years 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; provided, however, Arthur Andersen's opinion for the
year ended September 30, 1997 contained in a separate paragraph
stating the following:
The accompanying consolidated financial statements had been
prepared assuming that the Company would continue as a going
concern. As discussed in Note A to the consolidated financial
statements, the Company had experienced declining revenues,
significant operating losses, had negative working capital and a
deficit in stockholders equity. In addition, since a
recapitalization of the Company in March 1996, the Company had
relied upon the financial support of its largest shareholder for
additional capital and to maintain its existing credit facilities.
The Company's losses were expected to continue for the foreseeable
future and the Company would require additional funding and
financial support from its largest shareholder or another third
party. There could be no assurance that such additional funding
and financial support would be available on acceptable terms, or
that such funds, if available, would enable the Company to
continue operating. These matters raised substantial doubt about
the Company's ability to continue as a going concern. Management's
plans in regard to these matters were also described in Note A.
The financial statements did not include any adjustments relating
to the recoverability and classification of asset carrying amounts
or the amount of classification of liabilities that might result
should the Company be unable to continue as a going concern.
(iii) The dismissal of Arthur Andersen was approved by the Board
of Directors of the Company on July 28, 1998.
(iv) In connection with its audits for the two most recent fiscal
years and through September 16, 1998, there have been no
disagreements with Arthur Andersen on any matter of accounting
principles or practices, financial statement disclosure, or
auditing scope or procedure, which disagreements, if not resolved
to the satisfaction of Arthur Andersen
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would have caused them to make reference thereto in their report
on the financial statements for such years.
(v) During the two most recent fiscal years and through September
16, 1998, there have been no reportable events (as defined in
Regulation S-K Item 304(a)(1)(v)) with Arthur Andersen.
(vi) The Company requested that Arthur Andersen furnish a letter
addressed to the Securities and Exchange Commission stating that
it agrees with the above statements. A copy of such letter, dated
September 17, 1998, is filed as Exhibit 99.1 to this Form 8-K.
(b) On September 17, 1998, the Company engaged the firm of KPMG Peat
Marwick LLP as independent accountants for the fiscal year ending
September 30, 1998.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.
Not applicable.
(b) PRO FORMA FINANCIAL INFORMATION.
Not applicable.
(c) EXHIBITS. See Exhibit Index following signature page.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: September 17, 1998
THE CERPLEX GROUP, INC.
By: /s/ Steven L. Korby
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Steven L. Korby
Chief Financial Officer
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
No. Document
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<S> <C>
99.1 Letter from Arthur Andersen.
</TABLE>
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EXHIBIT 99.1
September 17, 1998
Office of the Chief Accountant
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Dear Sir/Madam:
We have read section (a) (i, ii, iv, and v) of Item 4 included in the Form 8-K
dated September 17, 1998 of the Cerplex Group, Inc. (the Company, formerly known
as Aurora Electronics, Inc.) filed with the Securities and Exchange Commission
and are in agreement with the statements contained therein. It should be noted
that we have had no involvement and have not consulted with the Company on any
accounting or reporting matters subsequent to January 12, 1998, the date of our
report on the September 30, 1997 financial statements.
Very Truly Yours,
ARTHUR ANDERSEN LLP
cc: Mr. Steve Korby, Chief Financial Officer, The Cerplex Group, Inc.
