Linwood, PA, Apr. 1--Foamex International Inc. dismissed Deloitte & Touche LLP (DET.XX) as its independent auditor on March 26, according to a Form 8-K filed Friday with the Securities and Exchange Commission.
The company named KPMG LLP as its new auditor.
According to the filing, the change was made following completion of a formal proposal process among several firms.
Foamex said that there weren't any disagreements with Deloitte & Touche during the most recent two fiscal years or the interim period.
The company said that Deloitte & Touche found reportable events in connection with its audit of the financial statements for the year ended Dec. 29, 2002.
Deloitte & Touche informed the company's audit committee on March 18, 2003, of problems related to the integration of the company's information technology systems and the design and operation of access and security controls of Foamex's information technology systems.
The auditor also informed the committee about the development of a formal process to review and approve journal entries; communication and financial reporting oversight with international subsidiaries and affiliates; and inventory procedures, processes and systems, including both performance and review, according to the filing.
Foamex said on March 9, Deloitte & Touche informed the company's audit committee of similar problems, except that the previous problems related to the development of a formal process to review and approve journal entries and communication and financial reporting oversight with international subsidiaries and affiliates weren't repeated.
Foamex said it is in the process of fixing the problems raised in the March 9 report.
According to the filing, in early 2003 the company began implementing a new enterprisewide information technology system, has addressed a number of the other technology security issues raised and has developed a plan to address the remaining matters.
The company said it also implemented improved inventory procedures in 2003 and has strengthened and is continuing to address the controls over the preparation of its quarterly financial reports.
