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
December 5, 1997
Date of Report (Date of earliest event reported)
SECURITY CAPITAL GROUP INCORPORATED
(Exact Name of registrant as specified in its charter)
Maryland 1-13355 36-3692698
(State or other (IRS Employer
jurisdiction of (Commission File Identification
incorporation) Number) Number)
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125 Lincoln Avenue
Santa Fe, New Mexico 87501
(Address of principal executive offices)
(505) 982-9292
(Registrant's telephone number)
Not applicable
(Former name or former address, if changed since last report)
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Item 4. Changes in Company's Certifying Accountant.
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For the fiscal year ended 1996, Arthur Andersen LLP ("Arthur
Andersen"), the principal accountant for Security Capital Group
Incorporated (the "Company") expressed reliance upon the report of Ernst &
Young LLP ("Ernst & Young") with respect to the financial statements of
Homestead Village Incorporated ("Homestead"), a subsidiary of the Company.
For the fiscal year ending 1997, Arthur Andersen is not expected to express
reliance upon the report of Ernst & Young with respect to the financial
statementsof Homestead.
On December 5, 1997, Homestead dismissed Ernst & Young as
Homestead's principal accountant to audit Homestead's financial statements
and engaged Arthur Andersen as Homestead's principal accountant to audit
Homestead's financial statements for the fiscal year ending December 31,
1997. The decision to change accountants was approved by the Audit
Committee of the Board of Directors of Homestead.
Ernst and Young's report on the financial statements of Homestead,
for the fiscal year ending December 31, 1996, did not contain an adverse
opinion or a disclaimer of opinion and was not qualified or modified as to
uncertainty, audit scope, or accounting principles. In connection with the
audit of Homestead's financial statements for the fiscal year ended
December 31, 1996 and in subsequent interim periods, there has never been
any disagreement with Ernst & Young on any matter of accounting principle
or practice, financial statement disclosure, or auditing scope or
procedure, which disagreement, if not resolved to the satisfaction of Ernst
& Young, would have caused it to make reference to the subject matter of
the disagreement in connection with its report. In addition, there has
never been a reportable event as described in paragraph (a)(1)(v) of Item
304 of Regulation S-K, promulgated under the Securities Exchange Act of
1934 (a "Reportable Event").
Prior to engaging Arthur Andersen, Homestead had never consulted
Arthur Andersen concerning either (i) the application of accounting
principles to a specified completed or uncompleted transaction; (ii) the
type of audit opinion that might be rendered on Homestead's financial
statements; (iii) a written report or oral advice that the new accountant
concluded was an important factor considered by Homestead in reaching a
decision as to an accounting, auditing or financial reporting issue; or
(iv) any matter that was the subject of a Reportable Event.
The letter from Ernst & Young evidencing its agreement with the
statements made by Homestead herein is attached as Exhibit 99.1.
Item 7. Exhibits.
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(c) Exhibits
99.1 Letter from Ernst & Young.
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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 hereunto duly authorized.
Date: December 5, 1997 SECURITY CAPITAL GROUP INCORPORATED
By: /s/ Jeffrey A. Klopf
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Name: Jeffrey A. Klopf
Title: Senior Vice President and
Secretary
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December 12, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Gentlemen:
We have read Item 4 of Form 8-K dated December 5, 1997, of Security Capital
Group Incorporated and are in agreement with the statements contained in the
third paragraph on page two therein. We have no basis to agree or disagree
with other statements of the registrant contained therein.
/s/ ERNST & YOUNG LLP
