Honeywell International (NYSE: HON) announced in an Item 4.01 8-K yesterday that, after the 2014 annual report was filed, the company would be engaging Deloitte as its independent auditor.
On July 29, 2014, the Audit Committee approved the engagement of Deloitte & Touche LLP (D&T) as the Company’s independent registered public accounting firm for the Company’s fiscal year ended December 31, 2015 and the dismissal of PricewaterhouseCoopers LLP (“PwC”). The dismissal of PwC will become effective upon issuance by PwC of its reports on the consolidated financial statements as of and for the year ended December 31, 2014 and the effectiveness of internal control over financial reporting as of December 31, 2014 to be included in the filing of the related Form 10-K.
Honeywell is the largest US company to change auditors this year; its audit fees for fiscal 2013 topped $25 million. PwC has audited Honeywell since 1969. This may seem like a very long time, but there are about 100 other companies in the S&P 500 with auditor tenures longer than that. A couple, such as Procter & Gamble (NYSE: PG), have an auditor relationship going back to the 19th century – over 100 years!
Here is a sample of auditor tenures from S&P 500 companies.
It is interesting to note that just a few months ago the Audit Committee and the Board of Directors recommended the retention of PwC as the company’s auditor.
The Audit Committee and Honeywell’s Board of Directors believe that the continued retention of PwC as the Company’s independent registered public accounting firm is in the best interests of the Company and its shareowners. Honeywell has been advised by PwC that it will have a representative present at the Annual Meeting who will be available to respond to appropriate questions. The representative will also have the opportunity to make a statement if he or she desires to do so.
And the company’s shareholders resoundingly approved the appointment of PwC for the fiscal 2014 audit.
No issues were noted by either Honeywell or PwC in the disclosures relating to the departure, so we can only speculate about what may have led to this change.
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