PwC resigned as the publicly traded REIT's independent auditor without much explanation; however, in a February response to Mission West's request for an explanation, PwC said that Mission West's financial statements for 2001 and 2002 and 2003 "should no longer be relied upon."
Mission West, which maintains a re-audit will show no material adverse adjustments, has stated that by making such statements PwC "has acted recklessly, thereby exposing the company to undetermined costs and damages."
This week, Mission West revealed that it might be trying to prove that, saying the audit committee of its board of directors has retained independent counsel "to investigate matters asserted by PwC subsequent to its resignation," and that it is "unable to retain new independent accountants until that investigation is concluded."
Mission West says it hopes to hire a new independent accountant by the end of this month; however, the company did not provide a timeline for the issuance of the company's 10-K for 2003 or for the review of the previous two years' financial statements, which PwC has thrown into question.
On Feb. 2, when the resignation was announced, its share price ended the trading day at $13.13, up $0.16 from its previous close and on its way toward $14 per share. On Feb. 20, when PwC said Mission West's financial statements should not be trusted, the share price fell $0.65 to end the day at $13.25. On Tuesday, the company's share price closed at $12.87, up $0.06 from Monday's close on news of a first-quarter common stock cash dividend of $0.24 per share.
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