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SAN DIEGO, CA – Presidio Property Trust, Inc. (NASDAQ:SQFT), a real estate investment trust (REIT), has announced the dismissal of its previous independent registered public accounting firm, Baker Tilly US, LLP, and the appointment of Moss Adams LLP as its new auditor. The change was effective as of Monday, August 19, 2024, as stated in a recent SEC filing.
The decision, made by the Audit Committee of Presidio Property Trust, came after the company identified material weaknesses in its internal control over financial reporting. These weaknesses pertained to a non-recurring significant transaction for income tax provision under ASC 740, Income Taxes.
Specifically, the company noted a lack of formal review and approval process in connection with the annual income tax provision and inadequate internal controls related to the income tax provision.
During the years ending December 31, 2023, and December 31, 2022, and the subsequent interim period, there were no disagreements with Baker Tilly on matters of accounting principles or practices, financial statement disclosures, or auditing scope or procedures that would have necessitated a mention in the audit reports.
Presidio Property Trust discussed the identified material weaknesses with Baker Tilly, and the Audit Committee has authorized full cooperation with the inquiries of the new auditor, Moss Adams, concerning this matter. Baker Tilly has provided a letter, dated August 21, 2024, to the SEC, agreeing with the statements made by Presidio Property Trust in the filing.
The engagement of Moss Adams as the new auditor was also confirmed on August 19, 2024, and they will commence auditing the company's consolidated financial statements for the year ending December 31, 2024. Prior to this engagement, the company had not consulted with Moss Adams on any accounting, auditing, or financial reporting issues that might have influenced their decision-making process.
InvestingPro Insights
As Presidio Property Trust, Inc. (NASDAQ:SQFT) confronts internal control weaknesses, investors may be eyeing the company's financial metrics with increased scrutiny. According to recent data from InvestingPro, Presidio Property Trust has a market capitalization of $7.75 million and trades at a low Price / Book multiple of 0.23, which could indicate the stock is undervalued relative to its book value. Despite challenges, the company maintains a significant dividend yield of 15.16%, a compelling factor for income-focused investors.
InvestingPro Tips suggest that while Presidio Property Trust pays a considerable dividend to shareholders, the stock has experienced high price volatility and has not been profitable over the last twelve months. It's also worth noting that the stock has seen a substantial decline over various time frames, including a 20.99% drop over the last month and a 45.33% fall over the last six months. These insights, along with over ten additional tips available on InvestingPro, could help investors make more informed decisions regarding their interest in SQFT.
Investors considering Presidio Property Trust should weigh these factors along with the company's efforts to enhance its financial reporting processes. For those seeking more detailed analysis and additional InvestingPro Tips, further information can be found at: https://www.investing.com/pro/SQFT.
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