Shares of Fremont General (FMT) slumped late Monday after the company announced Grant Thornton has resigned as the industrial bank's independent public accounting firm.
Fremont said that since Grant Thornton's hiring in August 2006, "there has not been any disagreement between the Company and Grant Thornton on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreement, if not resolved to the satisfaction of Grant Thornton, would have caused Grant Thornton to make reference to the subject matter of the disagreement in connection with its audit report."
Fremont said Grant Thornton had decided to significantly expand the scope of its audit of Fremont, in light of Fremont's "current operating environment and the industry in which it operates."
"At no time did the Company either fail to provide to Grant Thornton any requested information on a timely basis or communicate to Grant Thornton that it was opposed to any additional procedures or testing or to Grant Thornton's request to expand the audit scope," Fremont said in a press release.
Fremont said its Audit Committee will commence the process of selecting an independent registered public accounting firm to replace Grant Thornton as the Company's principal accountant. There can be no assurance that the Company will be able to retain a new independent registered public accounting firm.
Shares of Fremont fell nearly 11% in after-hours trading to $5.82.