SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
July 31, 1997
________________________________________________
Date of Report (Date of earliest event reported)
CONTROLLED ENVIRONMENT AQUACULTURE
TECHNOLOGY, INC.
________________________________________________
(Exact name of registrant as specified in its charter)
Colorado 0-25868 84-1293167
________________________________________________
(State or other (Commission I.R.S.Employer
jurisdiction File Number) Identification No.)
of incorporation)
CEA TECH USA, Inc.
7 Waterfront Plaza, Suite 400
500 Ala Moana Blvd.
Honolulu, HI 96813
__________________________________________________________
(Address of Principal Office) (Zip Code)
(808)521-1801
__________________________________________________________
Issuer's telephone number, including area code
<PAGE>
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING
ACCOUNTANT
(a) DISMISSAL OF PRINCIPAL ACCOUNTANT.
The Company has previously reported the dismissal of Grant Thornton
LLP as the principal accountant to audit its financial statements. In its
filing, the Company indicated that there were no disagreements with its
former accountants of a nature which if not resolved to the satisfaction
of such former accountants would have caused it to make a reference to
the subject matter of the disagreements in connection with its reports.
The Company believes its statement was accurate.
Attached to this report as an exhibit is a letter from Grant Thornton LLP
indicating that it believes there were disagreements between the
Company and its accountants which were required to be reported in the
Form 8-K filing.
It is the position of the Company that the attached letter from its former
accountants does not, in many respects, accurately state the facts, and
that it was issued by the former accountants primarily as a result of the
fact that there is an on-going billing dispute between the parties. As
discussed below, there is no known disagreement between the Company
and its former accountants as to the accuracy of the financial statements
which were included in the Company's current filings.
On April 4, 1997, Grant Thornton issued its audit opinion regarding the
financial statements of the Company. Subsequent to the issuance of its
opinion, Grant Thornton advised the Company that the financial
statements should be modified to account for redeemable preferred stock
in a different manner, which caused a disagreement between the parties.
This disagreement arose after Grant Thornton issued its audit opinion
regarding the Company's financial statements, and was resolved to the
satisfaction of Grant Thornton within a short period of time. As a
result, one footnote to the Company's financial statements was modified.
Grant Thornton then requested the Company to file an amended report
on Form 10-KSB incorporating the revised financial statements, and
including the audit opinion of Grant Thornton regarding the revised
financial statements. The Company complied with this request by filing
an amended report on Form 10-KSB on May 12, 1997. There is no
known disagreement between the Company and Grant Thornton LLP as
to the accuracy of the financial statements included in the Company's 10-
KSB/A filed on May 12, 1997.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) The following exhibits are filed as part of this report:
Exhibit 16 - Letter on change in certifying accountant.
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.
CONTROLLED ENVIRONMENT AQUACULTURE TECHNOLOGY,
INC.
/s/__________________________________________
J. A. Garcia, President 8/27/97
(Signature) (Date)
<PAGE>
EXHIBIT 16 - LETTER ON CHANGE IN CERTIFYING
ACCOUNTANT.
GRANT THORNTON LLP
Suite 1000
1132 Bishop Street
Honolulu, HI 96813
August 18, 1997
Securities and Exchange Commission
Washington, DC 20549
Re: Controlled Environment Aquaculture Technology, Inc.
File No. 0-25868
Dear Sir or Madam:
We have read Item 4 of the Form 8-K of Controlled Environment
Aquaculture Technology, Inc. (the "Company") dated July 31, 1997.
We believe that it should be supplemented and, in part, amended as
follows.
With regard to the financial statements of the Company as of January 31,
1997 and for the year then ended and for the period from January 19,
1995 (date of inception) through January 31, 1997, there were
disagreements as to the accounting for redeemable preferred stock issued
by the Company. Such disagreements were not resolved to our
satisfaction at the time that the Company filed its Form 10-KSB. The
Company filed an amended Form 10-KSB after amending its written
preferred stock purchase agreement.
In addition, we believe that the following reportable items have been
omitted.
1. The Company filed its Form 10-KSB without ever receiving a
manually signed opinion from us at the time when disagreements had not
been resolved to our satisfaction. Thereafter, an amended Form 10-KSB
was filed without ever receiving a manually signed opinion from us.
2. We have previously notified the Company that the financial
statements as filed in the original Form 10-KSB were in error. We are
also concerned that these incorrect financial statements were included in
a private placement memorandum distributed by the Company. We have
requested that the Company provide us with a copy of its private
placement memorandum containing the corrected financial statements in
an attempt to resolve this concern. To date, we have not been provided
with such requested copy.
3. Subsequent to the Company's notification to us that we had been
terminated as the principal accountants to audit the Company's financial
statements, we discovered that the Company filed a Form S-8 on June
3, 1997, without obtaining our consent. In fact, on June 2, 1997, we
specifically declined to give our consent to the incorporation by
reference of our audit opinion in such registration statement.
4. In view of the matters described above, by letter dated August 6,
1997, we informed the Company that we have withdrawn our audit
report and that such report should not be relied upon by any party. We
also requested the Company to immediately remove our audit report and
any references to Grant Thornton LLP from the Form S-8 and any other
documents in which our name or audit report may appear and to notify
anyone to whom it has furnished our audit report that it did so without
our permission and that we have withdrawn such report.
We have no basis to comment on the information included in Item 4b.
Very truly yours,
/s/
GRANT THORNTON LLP
RYMorihara
lf
