Item 4.01 Changes in Registrant's Certifying Accountant.
(a) On March 16, 2022, Cardiff Lexington Corp. (the "Company") dismissed
Rosenberg Rich Baker Berman PA ("RRBB") as the Company's independent registered
public accounting firm.
RRBB was engaged as the Company's independent registered public accounting firm
on or about June 23, 2021. As described in the Company's Form 12b-25s filed with
the Securities and Exchange Commission (the "Commission") on August 24, 2021 and
November 12, 2021 relating, respectively, to the Company's Quarterly Reports on
Form 10-Q for the quarters ended June 30, 2021 and September 30, 2021, which are
incorporated herein by reference, RRBB was unable to complete its review of the
Company's June 30, 2021 and September 30, 2021 financial statements as they were
evaluating issues that they believed could result in material errors in the
Company's financial statements for the years ended December 31, 2019 and
December 31, 2020, and within the interim periods within those fiscal years.
Working with the Company's prior auditors as well as outside consultants, the
Company concluded that its previously issued consolidated financial statements
as of and for the year ended December 31, 2020 included in our Annual Report on
Form 10-K (the "2020 10-K") and the Company's unaudited condensed consolidated
financial statements for the three months ended and 2021 year-to-date period
ended March 31, 2021 (the "2021 Q-1 10-Q") should no longer be relied upon.
Reference is made to the Company's Current Report on Form 8-K filed with the
Commission on February 17, 2022 to that effect, which is incorporated herein by
this reference. should no longer be relied upon. Amendments to the 2021 10-K and
the 2021 Q-1 10-Q (collectively, the "Amendments") were filed on February 18,
2022.
After filing the Amendments, the Company, on February 21, 2022, furnished
information to RRBB in order to begin the process of obtaining a review of the
Quarterly Reports on Form 10-Q for the quarters ended June 30, 2020 and
September 30, 2021. At that time, the Company was advised that "[a]t this point,
we don't have the capacity to get back into procedures over the revised
financial information you provided. We expect to begin our procedures during the
first week of April 2022, however if that changes, we will let you know." The
Company was further advised that "prior to beginning any audit procedures on the
company's financial statements for the year ended December 31, 2021, we need to
complete the reviews of the June 30th and September 30th financial statements
for filing of the 10Q's."
Accordingly, the decision was made to dismiss RRBB. This decision was made by
the Company's board of directors.
As indicated above, RRBB never issued a report on the Company's financial
statements for the fiscal years ended December 31, 2021 and 2020 - as a result,
there was no adverse opinion or a disclaimer of opinion and there was no opinion
that was qualified or modified as to uncertainty, audit scope, or accounting
principles.
Furthermore, from June 23, 2021 to the present, there were no disagreements with
RRBB on any matter of accounting principles or practices, financial statement
disclosure or auditing scope or procedure, which disagreements, if not resolved
to RRBB's satisfaction, would have caused RRBB to make reference to the subject
matter of the disagreement in connection with its reports on the Company's
financial statements for such periods.
From June 23, 2021 to the present, there we no "reportable events" as that term
is described in Item 304(a)(1)(v) of Regulation S-K.
The Company has provided RRBB with a copy of the disclosure contained herein,
prior to its filing with the Securities and Exchange Commission (the
"Commission"), and requested that RRBB furnish the Company a letter addressed to
the Commission stating whether or not it agreed with the statements herein and,
if not, stating the respects in which it does not agree. RRBB's letter to the
Commission is attached hereto as Exhibit 16.1.
(b) On March 16, 2021, the Board of Directors approved the appointment of
Grassi & Co., CPAs, P.C. ("Grassi") as the Company's independent registered
public accounting firm. During the Company's two most recent fiscal years
through March 16, 2022, neither the Company nor anyone acting on the Company's
behalf consulted Grassi with respect to any of the matters or reportable events
set forth in Item 304(a)(2)(i) and (ii) of Regulation S-K.
Item 9.01. Financial Statements and Exhibits.
Number Exhibit
16.1 Rosenberg Rich Baker Berman PA letter dated March 16, 2022
104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
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