REDONDO BEACH, Calif., Feb. 22, 2005 (PRIMEZONE) -- CorpHQ Inc. (Pink Sheets:COHQ) today announced that its board had accepted the resignation of its auditor of eight years, Henry Schiffer CPA Corporation. The letter of resignation, together with CorpHQ's Voluntary Report of an Unscheduled Material Event, has been posted at http://www.pinksheets.com/quote/finance.jsp?symbol=COHQ.
The letter stated, "Unfortunately, we have concluded that we are not comfortable providing audit services to public companies without first registering with the PCAOB... Therefore, we must respectfully decline from providing auditing services to CorpHQ, Inc. until we are registered with the PCAOB."
The letter further stated, "This was a very difficult decision on our part, and should in no way be perceived as an adverse relationship or financial statement issue... there have been no material disagreements between CorpHQ Inc. and (our firm) on any matter of accounting principles, financial statement disclosure, internal controls or auditing scope or procedure. Please accept our apologies in this matter."
"While this is certainly a surprise and a disappointment, our board has previously prepared the company for such an event," said Steve Crane, CEO of CorpHQ. "In early 2004, our board engaged Jessie Palpallatoc to independently evaluate our internal controls and to prepare reviewed financial statements on a quarterly basis. Ms. Palpallatoc is a fully-licensed California certified public accountant."
Crane added, "Per our normal procedure, she has already begun work on CorpHQ's fiscal year 2004 financial statements. Instead of handing her work off to the auditor as she has in the past, she will issue reviewed financial statements to our board of directors. We will incorporate that financial statement in our Annual Report, which is scheduled for release on or about March 15, 2005. We will begin interviewing auditors immediately and would hope to be able to post audited financial statements for the 2004 fiscal year within 90 days."
Kenneth S. August, one of our Directors and the President of August Law Group, P.C., Legal Counsel for CorpHQ, Inc., commented, "It is a shame that the fallout of the large public company scandals of recent years has now resulted in such fear and apprehension across all sectors of the financial markets that a small, non-reporting company which is not yet subject to the periodic reporting requirements of the Securities Act of 1934, but wishes to provide as much of the same information to its shareholders on a voluntary basis as it can, must settle for less than an audited financial statement because its auditor of eight years cannot find assurance that it doesn't have to be registered with the PCAOB before providing an audit to the company. Once again, it is the shareholders of the small public company who lose out by not receiving the best-quality information, as a result of the high costs of providing that information now even by those who are not required to file reports under the prevailing statutory regime."
About CorpHQ Inc.
CorpHQ Inc. operates as a holding company and business incubator; we organize, invest in, and provide comprehensive management support and a variety of resources to high-potential companies. CorpHQ also acquires interests in and provides consultation to selected companies that are synergistic with its portfolio companies.
CorpHQ provides periodic Voluntary Financial Reports on its operations at http://www.pinksheets.com/quote/finance.jsp?symbol=COHQ.
Forward-Looking Statements
"Any statements made in this press release which are not historical facts contain certain forward-looking statements, as such term is defined in the Private Litigation Reform Act of 1995, concerning potential developments affecting the business, prospects, financial condition and other aspects of the company to which this release pertains. These forward looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results of the specific items described in this release, and the company's operations generally, to differ materially from what is projected in such forward-looking statements. Although such statements are based upon the best judgments of management of the company as of the date of this release, significant deviations in magnitude, timing and other factors may result from business risks and uncertainties including, without limitation, the company's dependence on third parties, general market and economic conditions, technical factors, the availability of outside capital, receipt of revenues and other factors, many of which are beyond the control of the company. Although we believe that the expectations reflected in the forward looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of such statements, and we disclaim any obligation to update information contained in any forward-looking statement."
This press release is available at www.corphq.com and http://www.pinksheets.com/quote/quote.jsp?symbol=COHQ.