During Saba’s two most recent fiscal years ended May 31, 2012 and May 31, 2011, and during the subsequent interim period to January 17, 2013, there were no disagreements between Ernst & Young and Saba on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to Ernst & Young’s satisfaction, would have caused it to make reference to the subject matter of the disagreement in connection with its reports.Except with respect to the issue of material weaknesses referenced below, there were no “reportable events” under Item 304(a)(1)(v) of Regulation S-K that occurred during Saba’s two most recent fiscal years ended May 31, 2012 and May 31, 2011, and during the subsequent interim period to January 17, 2013. Saba’s management, in consultation with the Audit Committee, is in the process of evaluating Saba’s internal controls over financial reporting in light of matters identified in connection with its pending restatement and its review of its accounting practices. Saba’s ongoing evaluation of these matters is being discussed with Ernst & Young and is expected to be completed in the near future. Based on the results of the previously announced review of Saba’s accounting and time-recording practices in its professional services business, Saba’s management has concluded, consistent with the advice of Ernst & Young, there are material weaknesses in its internal control over financial reporting. Saba has not completed the preparation of its financial statements and other information required to complete the periodic reports for the fiscal years ended May 31, 2012, 2011 and 2010, as well as for the quarterly periods ended August 31, 2012 and November 30, 2012. Upon completion of the filing of its Forms 10-K and 10-Q applicable to such fiscal years and quarterly periods, Saba will file with the SEC any additional information required to be provided by an amendment to its Form 8-K filed with the SEC on January 18, 2013, pursuant to Items 304(a)(1)(ii), (iv), and (v) of Regulation S-K, as applicable.
The Audit Committee of Saba’s Board of Directors has discussed the subject matter of the above described reportable events with Ernst & Young, and will authorize Ernst & Young to respond fully to the inquiries of a successor auditor concerning the subject matter above.Saba continues to work to complete the restatement of its prior period financial results in order that it can file its overdue SEC periodic reports as soon as practicable. The Audit Committee of Saba’s Board of Directors has begun the process of selecting its new independent registered public accounting firm. About Saba Saba ( NASDAQ: SABA) enables organizations to build a transformative workplace that leverages the advent of social networking in business and the ubiquity of mobile to empower an organization’s most mission-critical assets – its people. Saba provides a set of people-centric enterprise solutions to various businesses and industries worldwide. Saba delivers cloud-based learning management, talent management, and social enterprise solutions to transform the way people work. Saba's premier customer base includes major global organizations and industry leaders in financial services, life sciences and healthcare, high tech, automotive and manufacturing, retail, energy and utilities, packaged goods, and public sector organizations. Headquartered in Redwood Shores, California, Saba has offices on five continents. For more information, please visit www.saba.com or call +1-877-SABA-101 or +1-650-779-2791. SABA, the Saba logo, and the marks relating to Saba products and services referenced herein are either trademarks or registered trademarks of Saba Software, Inc. or its affiliates. All other trademarks are the property of their respective owners. Safe Harbor This press release contains forward-looking statements within the meaning of the federal securities laws, including, without limitation, Saba’s identification of “reportable events” and Saba’s ability to comply with the April 4, 2013 NASDAQ deadline by completing the previously announced restatement and filing its outstanding annual report on Form 10-K and periodic reports on Form 10-Qs with the SEC, Saba’s ongoing evaluation of its internal controls over financial reporting, and Saba’s efforts to retain a new independent registered public accounting firm. Saba faces risks and uncertainties that could affect its ability to complete the restatement of its historical financial statements, file its delayed annual report on Form 10-K and periodic reports on Form 10-Qs and regain compliance with the NASDAQ listing requirements or could cause it to determine that additional material weaknesses exists with respect to its internal control over financial reporting. Readers should refer to the section entitled “Risk Factors” in the Form 10-K for the fiscal year ended May 31, 2011, and similar disclosures in subsequent reports filed with the SEC. The forward-looking statements and risks stated in this press release are based on information available to Saba today. Saba assumes no obligation to update them.