BURGERFI INTERNATIONAL, INC. Item 4.01. Change in Registrant's Certifying Accountant.
(a) Resignation of Independent Registered Public Accountants.
On
On
The reports of BDO on the Company's consolidated financial statements for the
fiscal years ended
During the fiscal years ended
2021. A material weakness related to the design and implementation of controls
over the accounting for income taxes. Specifically, management did not maintain
controls over the Company's assessment of its ability to realize historical
deferred tax assets on its acquired businesses in accordance with Section 382 of
the Internal Revenue Code and the Company's tax provision controls were not
designed to detect certain errors and omissions in calculating the impact of
certain transactions on the income tax provision during the period. This
material weakness resulted in the identification of errors that were corrected
in the consolidated financial statements included in the Company's Annual Report
on Form 10-K for the year ended
2020. A number of material weaknesses in our internal control over financial reporting, as follows:
• lack of controls over the financial closing and reporting process
relating to a sufficient segregation of duties in the preparation of our
financial statements and related notes, and, for period (the "Successor
Period") from December 16, 2020 until December 31, 2020 , the valuation
and recognition of stock-based compensation and warrant liabilities;
• lack of resources to perform and review the application of accounting
standards for revenue, leases, and variable interest entities ("VIEs");
• specifically with respect to VIEs, our internal control over financial
reporting failed to detect errors related to consolidating variable
interest entities for which we are the primary beneficiary;
• lack of effective controls over the accounting for deferred rent and
accounting for initial franchise fees and brand development revenue in
connection with the adoption of our new revenue recognition standard; and
• lack of controls during the Successor Period related to the valuation of
contingent consideration issued in the business combination with BurgerFi
International, LLC .
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The material weaknesses were discussed with the Audit Committee. The Company has
authorized BDO to respond fully to inquiries of
The Company has provided BDO with a copy of this Form 8-K and requested that BDO
provide the Company with a letter addressed to the
(b) Engagement of New Independent Registered Public Accountants.
As a result of the RFP process described above, on
During the two most recent fiscal years and through the date of engagement, the
Company has not consulted with
(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 financial statements, and neither a written report was
provided to the Company nor oral advice was provided that
(ii) Any matter that was either subject of "disagreement," as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instruction to Item 304 of Regulation S-K, or a "reportable event," as that term is explained in Item 304(a)(1)(v) of Regulation S-K.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits Exhibit Number Description 16.1 Letter from BDO, datedMay 12, 2022 104 Cover Page Interactive Data File (embedded within the Inline XBRL document). 3
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