Savient Pharmaceuticals (NASDAQ: SVNT), a $160 million biopharmaceutical company, announced on Friday that it had dismissed McGladrey & Pullen as its auditor. We view the auditor change as an improvement.
The company reported that there were no disagreements with McGladrey at the time of its dismissal. KPMG was selected as the new auditor.
The company, which has not reported any significant accounting issues since Dec-06, upgraded to a top-tier auditor. A new CFO in Sep-11 and a new auditor represent a fair amount of change on the finance/accounting side of the business. The risk is that the new CFO or KPMG have different views than their predecessors, which could somehow impact the company. Of note is the timing of the audit change, which comes after the stock has slid more than 80% from its high in late April.
Here is SVNT's SEC filing regarding the matter.