Item 4.01. Changes in Registrant's Certifying Accountant.
(a) Dismissal of Independent Registered Public Accounting Firm
On April 15, 2023, the Board of Directors of Galaxy Next Generation, Inc. (the
"Company"), approved the dismissal of, and dismissed Somerset CPAs and Advisors
("Somerset") and Rodefer Moss & Co, PLLC ("Rodefer") was engaged to serve as the
independent registered public accounting firm of the Company for the year ending
June 30, 2023, effective immediately. The dismissal of Somerset and the
engagement of Rodefer was approved by the Company's Board of Directors. The
services previously provided by Somerset will now be provided by Rodefer.
Somerset's reports on the Company's consolidated financial statements for the
fiscal years ended June 30, 2022 and 2021 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, except as follows: Somerset's report on
the consolidated financial statements of the Company and subsidiaries as of and
for the years ended June 30, 2022 and 2021 contained a separate paragraph
stating that: "The accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going concern. As
discussed in Note 14 to the consolidated financial statements, the Company has
suffered recurring losses from operations, recurring negative operating cash
flows and has a net capital deficiency that raises substantial doubt about its
ability to continue as a going concern. Management's plans in regard to these
matters are also described in Note 14. The consolidated financial statements do
not include any adjustments that might result from the outcome of this
uncertainty. .
During the Company's two most recent fiscal years ended June 30, 2022 and 2021,
and the subsequent interim period from July 1, 2022 through April 15, 2023,
there were no disagreements ("disagreement" is defined in Item 304(a)(1)(iv) of
Regulation S-K and the related instructions to Item 304 of Regulation S-K)
between the Company and Somerset 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 Somerset, would have
caused Somerset to make reference to the subject matter of the disagreements in
connection with its reports on the Company's consolidated financial statements
for such years. In addition, during the Company's two most recent fiscal years
ended June 30, 2022 and 2021, and the subsequent interim period from July 1,
2022 through April 15, 2023, there were no "reportable events," as defined in
Item 304(a)(1)(v) of Regulation S-K.
As previously disclosed in Item 9A of the Company's Annual Reports on Form 10-K
for each of the fiscal years ended June 30, 2022 and 2021, the Company concluded
that its internal control over financial reporting was not effective as of June
30, 2022 and 2021 due to certain material weaknesses. The material weakness
relates to the fact that the Company's management is relying on external
consultants for purposes of preparing its financial reporting package; however,
the officers may not be able to identify errors and irregularities in the
financial reporting package before its release as a continuous disclosure
document.
The Company provided Somerset with a copy of the above disclosures and requested
that Somerset furnish the Company with a letter addressed to the Securities and
Exchange Commission stating whether or not it agrees with the statements made
above. A copy of Somerset's letter dated April 20, 2023 is attached as Exhibit
16.1 to this Current Report on Form 8-K.
(b) Appointment of New Independent Registered Public Accounting Firm
On April 15, 2023, the Company engaged Rodefer as the Company's independent
registered public accounting firm for the fiscal year ending June 30, 2023,
effective immediately. During the fiscal years ended June 30, 2022 and 2021 and
the subsequent interim period from July 1, 2022 through April 15, 2023, neither
the Company nor anyone on its behalf consulted with Rodefer regarding (i) the
application of accounting principles to any specified transaction, either
completed or proposed or the type of audit opinion that might be rendered on the
Company's consolidated financial statements, and neither a written report nor
oral advice was provided to the Company that Rodefer concluded was an important
factor considered by the Company in reaching a decision as to any accounting,
auditing, or financial reporting issue, or (ii) any matter that was either the
subject of a "disagreement," as defined in Item 304(a)(1)(iv) of Regulation S-K,
or a "reportable event," as defined in Item 304(a)(1)(v) of Regulation S-K.
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
Number Description
16.1 Letter from Somerset, dated April 20, 2023, addressed to the Securities
and Exchange Commission
104 Cover Page Interactive Data File (the cover page XBRL tags are embedded
within the inline XBRL document)
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