Canopy Growth Corp. Announces Resignation of KPMG LLP as Independent Registered Public Accounting Firm

Strategic Insights -

KPMG LLP, the independent registered public accounting firm for Canopy Growth Corporation, has declined to stand for reelection and resigned as the Company's independent registered public accounting firm, effective June 22, 2023. The Audit Committee of the board of directors of the Company accepted KPMG's resignation on the same date. The resignation comes after KPMG reported that Canopy Growth's consolidated financial statements for the fiscal years ended March 31, 2023, and March 31, 2022, included an explanatory paragraph related to the restatement of the consolidated financial statements for the fiscal year ended March 31, 2022. The report also highlighted the Company's material debt obligations, recurring losses from operations, and the need for additional capital to fund its operations, which raised substantial doubt about its ability to continue as a going concern.

Key Takeaways:

  • KPMG LLP, the independent registered public accounting firm for Canopy Growth Corporation, resigned as of June 22, 2023, citing substantial doubt about the Company's ability to continue as a going concern due to material debt obligations, recurring losses from operations, and the need for additional capital.
  • The Audit Committee of the board of directors accepted KPMG's resignation on the same date.
  • KPMG's resignation report included an explanatory paragraph related to the restatement of Canopy Growth's consolidated financial statements for the fiscal year ended March 31, 2022.
  • The Company's consolidated financial statements for the fiscal years ended March 31, 2023, and March 31, 2022, did not contain an adverse opinion or a disclaimer of opinion, but were qualified due to the above-mentioned issues.
  • The Audit Committee discussed the reportable events with KPMG and authorized the firm to respond to inquiries by the successor independent registered public accounting firm.
  • PKFOD, a nationally recognized auditing firm, was engaged as the Company's independent registered public accounting firm for the fiscal year ending March 31, 2024.

Statistics:

  • Date of report: June 22, 2023
  • June 22, 2023, the date on which KPMG declined to stand for reelection and resigned as the Company's independent registered public accounting firm.
  • March 31, 2022: The date on which Canopy Growth reported restated consolidated financial statements.
  • Canopy Growth's consolidated financial statements for the fiscal years ended March 31, 2023, and March 31, 2022, include an explanatory paragraph related to the restatement of the consolidated financial statements for the fiscal year ended March 31, 2022.

Sources:

  • Form 8-K filed by Canopy Growth Corporation on June 27, 2023
  • Letter from KPMG LLP, dated June 27, 2023, filed as Exhibit 16.1 to the Form 8-K
  • Securities and Exchange Commission, Washington, D.C. 20549
  • COMTEX_436084338/2254/2023-06-27T19:05:18