Ventas dismisses Ernst & Young as auditor, engages KPMG

Ventas announced that the company has dismissed Ernst & Young as its public accounting firm, effective July 5, due to E&Y’s determination that it was not independent solely as a result of an inappropriate personal relationship between an E&Y partner and Ventas’s former Chief Accounting Officer and Controller. Ventas also announced that, following such dismissal, its Audit Committee has engaged KPMG LLP as the company's independent public accounting firm. E&Y has advised the company that, solely due to the inappropriate personal relationship, it determined that it was not independent of the company during the periods in question. As a result of such determination, E&Y stated that it was obligated under applicable law and professional standards to withdraw, and it has withdrawn, its audit reports on the company’s financial statements for the years ended December 31, 2012 and 2013, and its review of the company’s results for the quarter ended March 31, 2014. E&Y’s decision to withdraw such audit reports and review was made exclusively due to the personal relationship in question, and not for any reason related to Ventas’s financial statements, its accounting practices, the integrity of Ventas’s controls or for any other reason. Ventas believes that the company’s financial statements present fairly, in all material respects, the financial condition, results of operations and cash flows of the company as of the end of and for the referenced periods, and may continue to be relied upon. The company also believes that its internal control over financial reporting was effective during those periods. Ventas noted that the senior E&Y partner on the Ventas account, who signed the 2012 and 2013 audit reports, was not the individual involved in the inappropriate personal relationship. As the company’s new independent public accounting firm, KPMG has been engaged to complete a re-audit and re-review of the relevant periods. The company will devote all necessary resources to facilitate KPMG’s completion of its work on an expedited basis. There can be no assurance that KPMG will reach the same conclusions as E&Y regarding the application of accounting standards, management estimates or other factors affecting the company’s financial statements. The company also announced the separation of Robert J. Brehl from his position as Ventas’s Chief Accounting Officer and Controller in relation to these matters. Brehl’s separation from the company was not due to any disagreement with the company regarding its financial reporting or accounting operations, policies or practices. Richard A. Schweinhart, Executive Vice President and CFO of the company, has assumed Brehl’s responsibilities and will serve as the company’s Acting Chief Accounting Officer. To the extent requested by the company and the Ventas Board of Directors, Schweinhart has also agreed to modify and/or defer his previously announced retirement plans to ensure completion of the re-audit work and a smooth transition to his successor.