Why is Southern Copper Corp. changing its auditor from Arthur Andersen to Deloitte & Touche?

Southern Copper Corp. is changing its auditor as part of a decision to seek proposals from various independent auditing firms. This is a proactive step to evaluate its auditing services. Arthur Andersen LLP was dismissed, and Deloitte & Touche LLP has been appointed, subject to shareholder ratification.

Were there any disagreements or issues with Arthur Andersen that led to the dismissal?

No, the company explicitly stated that there were no disagreements with Arthur Andersen on any matters of accounting principles or practices, financial statement disclosure, or auditing scope or procedure. Furthermore, there were no 'reportable events' as defined by SEC regulations during the past two fiscal years and up to the date of dismissal.

What does it mean that Arthur Andersen's previous reports were unqualified?

An unqualified audit report means that Arthur Andersen expressed a positive opinion on the fairness of Southern Copper Corp.'s financial statements for the preceding two years. It indicates that the financial statements were presented fairly, in accordance with generally accepted accounting principles, and there were no significant issues or limitations identified by the auditors.

Will Arthur Andersen be completely out of the picture after the transition?

While Arthur Andersen LLP is no longer the principal auditor, Southern Copper Corp. intends to continue using Arthur Andersen for certain services during 2002 to ensure an orderly transition of auditors. This suggests a phased handover of responsibilities.

SCCO 8-K SEC Disclosure

Summary

Southern Peru Copper Corporation (SCCO) has announced a significant change in its independent auditors. On April 25, 2002, the Board of Directors, on the recommendation of the Audit Committee, approved the appointment of Deloitte & Touche LLP as the company's independent auditors for 2002. This decision involves the dismissal of Arthur Andersen LLP. The company stated that the change was initiated by a decision to seek proposals from various auditing firms. Importantly, SCCO reported no disagreements or "reportable events" with Arthur Andersen concerning accounting principles, financial statement disclosures, or auditing procedures during the past two fiscal years and up to the dismissal date. Arthur Andersen's previous audit reports for SCCO were unqualified. The appointment of Deloitte & Touche LLP is contingent upon shareholder ratification at the upcoming 2002 Annual Meeting.

Key Highlights

1Southern Peru Copper Corporation (SCCO) is changing its independent auditors, dismissing Arthur Andersen LLP and appointing Deloitte & Touche LLP for the 2002 fiscal year.
2The decision to change auditors was prompted by the company's proactive approach in seeking proposals from multiple auditing firms.
3No disagreements on accounting principles, financial statement disclosures, or auditing procedures occurred between SCCO and Arthur Andersen during the last two fiscal years and the interim period leading up to April 25, 2002.
4Arthur Andersen's audit reports for SCCO's financial statements in the prior two years were unqualified, meaning they did not express any reservations or limitations.
5The appointment of Deloitte & Touche LLP is subject to shareholder approval at the 2002 Annual Meeting of Shareholders.
6SCCO intends to utilize Arthur Andersen for certain transitional services during 2002 to ensure an orderly change.
7SCCO confirmed no prior consultations with Deloitte & Touche LLP regarding matters specified in Regulation S-K Item 304(a)(2)(i) and (ii) during the relevant periods.

SOUTHERN COPPER CORP/ 8-K Report (Apr 30, 2002)

Summary

Key Highlights

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