-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JbbvY0n8Tcj/dTKLAys5OXa6pSrASVxRPIjAPBuwlxCwiZqFCX35hPeGSwJzES/U DXJodnhay9Xj1H+b94fyeQ== 0000950149-97-000224.txt : 19970211 0000950149-97-000224.hdr.sgml : 19970211 ACCESSION NUMBER: 0000950149-97-000224 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970203 ITEM INFORMATION: Changes in registrant's certifying accountant ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970207 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: IEA INCOME FUND VII CENTRAL INDEX KEY: 0000803511 STANDARD INDUSTRIAL CLASSIFICATION: WATER TRANSPORTATION [4400] IRS NUMBER: 942966976 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-16834 FILM NUMBER: 97520601 BUSINESS ADDRESS: STREET 1: 444 MARKET ST 15TH FLR CITY: SAN FRANCISCO STATE: CA ZIP: 94111 BUSINESS PHONE: 4156778990 8-K 1 FORM 8-K 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (date of earliest event reported): February 3, 1997 IEA INCOME FUND VII (Exact name of registrant as specified in its charter) California 0-16834 94-2966976 (State or other jurisdiction (IRS Employer of incorporation or organization) (Commission File No.) Identification No.)
444 Market Street, 15th Floor, San Francisco, California 94111 (Address of principal executive offices) (zip code) Registrant's telephone number, including area code: (415) 677-8990 2 Item 4. Changes in Registrant's Certifying Accountant. (a) On February 3, 1997, Arthur Andersen, London, England, resigned as auditors of The Cronos Group, a Luxembourg corporation headquartered in Orchard Lea, England (the "Parent Company") (NASDAQ -- CRNSF). The Parent Company is the indirect corporate parent of Cronos Capital Corp., the General Partner of the Registrant. In its letter of resignation, Arthur Andersen states that it was unable to obtain adequate information in response to inquiries it had made in connection with its audit of the Parent Company for the year ended December 31, 1996. In connection with its resignation, Arthur Andersen also prepared a report pursuant to the provisions of Section 10A(b)(2) of the Securities Exchange Act of 1934, as amended, for filing by the Parent Company with the SEC. In this report, Arthur Andersen explains, based upon the information it then had available, that: (i) A disbursement of $1.5 million by the Parent Company and subsequent correspondence from the Parent Company's bank concerning the repayment of the disbursement to the Parent Company may have violated laws and regulations to which the Parent Company is subject, including U.S. securities laws, and that these matters may have a material effect upon the 1996 financial statements of the Parent Company; (ii) Senior management of the Parent Company had not taken, and the Board of Directors of the Parent Company had not caused senior management to take, timely and appropriate remedial actions with respect to these matters; and (iii) The circumstances of these matters and failure to take remedial action warranted Arthur Andersen's resignation as outside auditors of the Parent Company. In its letter of resignation to the Parent Company, Arthur Andersen states that it is resigning as auditors of the Parent Company and of all other entities affiliated with the Parent Company. While its letter of resignation is not addressed to the Managing General Partner or the Registrant, Arthur Andersen has confirmed to the Managing General Partner that its resignation as auditors of the entities referred to in its letter of resignation can be read to include Cronos Capital Corp. and the Registrant. The Managing General Partner also understands that the three outside directors on the Parent Company's six-member Board of Directors have resigned. The Registrant does not, at this time, have sufficient information to respond to the concerns raised by Arthur Andersen with respect to its 1996 audit of the Parent Company. However, the Managing General Partner of the Registrant does not believe, based upon the information currently available to it, that Arthur Andersen's resignation was triggered by any concern over the accounting policies and procedures followed by the Registrant. (b) The Registrant has yet to retain a new auditor. 3 Item 5. Other Events. See Item 4 above. Item 7. Financial Statements and Exhibits. (a) Financial statements of businesses acquired. Not applicable. (b) Pro forma financial information. Not applicable. (c) Exhibits. 16.1 Letter of resignation from Arthur Andersen to the Board of Directors of the Cronos Group, dated February 3, 1997. 16.2 Report of Arthur Andersen pursuant to Section 10A(b)(2) of the Securities Exchange Act of 1934, as amended, dated February 3, 1997, addressed to the Board of Directors of the Cronos Group. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. IEA INCOME FUND VII By: CRONOS CAPITAL CORP. The Managing General Partner By: /s/ DENNIS J. TIETZ ------------------------------- Dennis J. Tietz President Date: January 7, 1997 4 EXHIBIT INDEX
Exhibit No. Description Method of Filing - -------- ----------- ---------------- 16.1 Letter of resignation from Arthur Andersen to the Board of Filed with this document Directors of the Cronos Group, dated February 3, 1997. 16.2 Report of Arthur Andersen pursuant to Section 10A(b)(2) Filed with this document of the Securities Exchange Act of 1934, as amended, dated February 3, 1997, addressed to the Board of Directors of the Cronos Group.
EX-16.1 2 LETTER OF RESIGNATION FROM ARTHUR ANDERSEN 1 EXHIBIT 16.1 ARTHUR ANDERSEN ----------------------- 1 Surrey Street London WC2R 2PS 0171 438 3000 Telephone 0171 831 1133 Facsimile 3 February 1997 The Board of Directors The Cronos Group 35 Rue Glesener L-1631 Luxembourg Dear Sirs: We have concluded that we have not received a satisfactory response from the Board to our letters of 9 January 1997, 16 January 1997, and 24 January 1997. The "collective response from the Board" contained in the letter to us dated 28 January 1997 and signed by Mr. Eriksen on behalf of himself and Mr. Palatin did not appropriately address or explain the issues and inconsistencies which were set out in our letters. We were subsequently informed by Mr. Palatin in a telephone conversation on 31 January 1997 that no further explanations would be forthcoming or investigations undertaken. Since we have been, and continue to be, unable to obtain the information and explanations we require for the purposes of our 31 December 1996 audit of the Group, the circumstances no longer exist in which we will be able to perform such an audit in accordance with generally accepted auditing standards. Further, as we informed you in our previous letters, we are now obliged to submit a report to you pursuant to our obligations under Section 10A(b)(2) of the United Stated Securities Exchange Act of 1934, as amended by Title III of the United States Private Securities Litigation Reform Act of 1995. Accordingly: 1 We hereby resign with immediate effect as auditors of the consolidated Cronos Group and of its holding company, The Cronos Group societe anonyme, and of all other entities within the Cronos Group. 2 We enclose the report referred to above arising from our responsibilities under US Federal securities laws. The Board is required to notify the United States Securities and Exchange Commission of the receipt and contents of this report, together with certain other specified information, not later than one business day after the report has been received and to provide us with a copy of such notice. We assume that the Board will be taking US legal advise as to the fulfilment of its reporting obligation. Yours faithfully ARTHUR ANDERSEN EX-16.2 3 REPORT OF ARTHUR ANDERSEN 1 EXHIBIT 16.2 ARTHUR ANDERSEN ----------------------- PO Box 55 1 Surrey Street London WC2R 2NT 0171 438 3000 Telephone 0171 831 1133 Facsimile Direct line 0171 438 3120 3 February 1997 The Board of Directors The Cronos Group 35 Rue Glesener L-1631 Luxembourg PRIVATE AND CONFIDENTIAL Dear Sirs RE: Report Required by Section 10A(b)(2) of the United States Securities Exchange Act of 1934, as Amended by Title III of the United States Private Securities Litigation Reform Act of 1995 We are submitting this report to you in response to our obligations under Section 10A(b)(2), of the US Securities Exchange Act of 1934, as amended by Title III of the US Private Securities Litigation Reform Act of 1995. We refer to our letter of 24 January 1997 to the Board concerning certain matters which have come to our attention during the course of our audit at 31 December 1996, and for which we have been unable to obtain satisfactory explanation and support. In our letter of 24 January 1997, we stated that we require a response from the Board on the matters referred to in our letters of 9 January 1997 and 16 January 1997, by 5pm on Tuesday, 28 January 1997 (London time). We have considered the information received and conclude that we have not received a response that appropriately addresses the matters cited in those communications. Accordingly, as we previously informed you, we are required by US Federal securities laws to submit this report to you. We have concluded, based on the information we have as of the date of this letter, that (a) The disbursement of US $1.5 million and the subsequent correspondence from National Westminster Bank concerning repayment of that disbursement (copies of which you have previously received) may have violated laws and regulations to which Cronos is subject, including US Federal securities laws, and that these matters may have a material effect on the 1996 financial statements of Cronos. (b) Senior management has not taken, and the Board of Directors has not caused senior management to take, timely and appropriate remedial actions with respect to these matters; and 2 [ARTHUR ANDERSEN LETTERHEAD] -2- The Board of Directors 3 February 1997 (c) The circumstances of these matters and failure to take remedial action warrants our resignation from the engagement and we have so resigned. By receipt of this report, we hereby advise you that under Section 10A(b)(3) of the Securities Exchange Act of 1934, the Board is required to inform the US Securities and Exchange Commission by notice not later than one business day after receipt of this report that this report has been received, and provide us with a copy of such notice. Under Section 10A(b)(3), if we do not receive a copy of the notice referred to above by close of business UK time on 4 February 1997 we are required to, and will furnish a copy of this report to the SEC within one business day following failure to receive notice. Yours faithfully /s/ Arthur Andersen - ---------------------- -----END PRIVACY-ENHANCED MESSAGE-----