Item 4.01. Changes in Registrant’s Certifying Accountant.
The Audit Committee of the Board of Directors (the “Audit Committee”) of Brown-Forman Corporation (the “Company”), with the assistance of management, issued a Request for Proposal (“RFP”) regarding the Company’s engagement of an independent registered public accounting firm to audit the Company’s consolidated financial statements for its fiscal year ending April 30, 2021 (the “2021 Audit”). Thereafter, the Audit Committee conducted a comprehensive, competitive RFP process. The Audit Committee invited several firms to participate in this RFP process, including PricewaterhouseCoopers LLP (“PwC”), the Company’s current independent registered public accounting firm.
(a) Previous Independent Registered Public Accounting Firm
On February 19, 2020, the Audit Committee dismissed PwC, which is currently serving as the Company’s independent registered public accounting firm, effective upon completion of its audit of the Company’s consolidated financial statements as of and for the fiscal year ending April 30, 2020 and the issuance of its reports thereon (the “2020 Audit”).
The audit reports of PwC on the Company’s consolidated financial statements for each of the two most recent fiscal years ended April 30, 2018 and April 30, 2019 did not contain an adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles.
During the Company’s two most recent fiscal years ended April 30, 2018 and April 30, 2019, and during the subsequent interim period from May 1, 2019 through February 19, 2020, (i) there were no disagreements (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions thereto) between the Company and PwC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements, if not resolved to PwC’s satisfaction, would have caused PwC to make reference to the subject matter of the disagreements in connection with its reports on the Company’s consolidated financial statements for such fiscal years, and (ii) there were no reportable events (as described in Item 304(a)(1)(v) of Regulation S-K).
In accordance with Item 304(a)(3) of Regulation S-K, the Company provided PwC with a copy of this Current Report on Form 8-K and requested that PwC furnish the Company with a letter addressed to the Securities and Exchange Commission stating whether it agrees with the statements made by the Company herein and, if not, stating the respects in which it does not agree. A copy of PwC’s letter, dated February 25, 2020, is attached as Exhibit 16.1 to this Current Report on Form 8-K.
(b) New Independent Registered Public Accounting Firm
On February 19, 2020, the Audit Committee approved the engagement of Ernst & Young LLP (“EY”) as the Company’s independent registered public accounting firm for the Company’s 2021 Audit, subject to completion of EY’s customary pre-acceptance and independence procedures and the execution of an engagement letter. The change in the Company’s independent registered public accounting firm from PwC to EY will be effective upon the completion of the 2020 Audit.
During the two most recent fiscal years ended April 30, 2018 and April 30, 2019, and during the subsequent interim period from May 1, 2019 through February 19, 2020, neither the Company nor anyone on its behalf consulted with EY regarding (i) the application of accounting principles to a specified
transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s consolidated financial statements, and neither a written report nor oral advice was provided to the Company that EY concluded was an important factor considered by the Company in reaching a decision as to any accounting, auditing, or financial reporting issue, (ii) any matter that was either the subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instruction thereto), or (iii) any reportable event (as described in Item 304(a)(1)(v) of Regulation S-K).