FORM 8-K
CURRENT REPORT
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) JUNE 10, 2002
COMMISSION REGISTRANT; STATE OF INCORPORATION; IRS EMPLOYER
FILE NUMBER ADDRESS; AND TELEPHONE NUMBER IDENTIFICATION NO.
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1-9513 CMS ENERGY CORPORATION 38-2726431
(A Michigan Corporation)
Fairlane Plaza South, Suite 1100
330 Town Center Drive
Dearborn, Michigan 48126
(313) 436-9261
1-5611 CONSUMERS ENERGY COMPANY 38-0442310
(A Michigan Corporation)
212 West Michigan Avenue
Jackson, Michigan
(517) 788-1030
1-2921 PANHANDLE EASTERN PIPE LINE COMPANY 44-0382470
(A Delaware Corporation)
5444 Westheimer Road, P.O. Box 4967
Houston, Texas 77210-4967
(713) 989-7000
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
On June 10, 2002, CMS Energy Corporation ("CMS Energy"), Consumers Energy
Company ("Consumers"), and Panhandle Eastern Pipe Line Company ("Panhandle" and
collectively with CMS Energy and Consumers and all their respective
subsidiaries, the "Company") received a letter, attached hereto as Exhibit 99.1
and incorporated herein by reference, from Arthur Andersen LLP ("Arthur
Andersen") which indicates that the client-auditor relationship between Arthur
Andersen and the Company ceased. As previously disclosed on a Form 8-K dated
April 29, 2002, the Boards of Directors of CMS Energy and Consumers, on April
22, 2002, voted to discontinue the use of Arthur Andersen for the year ending
December 31, 2002. In a Form 8-K dated May 29, 2002, the Company stated that
Arthur Andersen would continue to be retained by CMS Energy in connection with
restating its financial statements as disclosed therein.
CMS Energy is currently in the process of completing the restatement that was
disclosed in the May 29, 2002 Form 8-K, which will involve amending its 2001
Form 10-K and restating its financial statements for 2000 and 2001 to eliminate
from revenue and expense all of the effects of round trip trades. These round
trip trades are also currently the subject of an investigation by a Special
Committee of the Board of Directors of CMS Energy.
As previously announced, Ernst & Young LLP ("Ernst & Young") has been retained
to audit the financial statements of the Company for the year ending December
31, 2002, including the separate financial statements of Consumers and
Panhandle, Ernst & Young has advised CMS Energy that it will audit, to the
extent necessary, the Company's restated financial statements for the years
ended December 31, 2000 and 2001. CMS Energy will publish restated financial
statements promptly upon completion of the investigation and required audit
work.
Following CMS Energy's announcement that it would restate its financial
statements for 2000 and 2001 to eliminate the effects of round trip energy
trades and form a Special Committee of its Board of Directors to investigate
these trades, Arthur Andersen informed the Audit Committee of CMS Energy (by
letter dated June 10, 2002, a copy of which is attached hereto as Exhibit 99.2
and incorporated herein by reference) that, in light of the uncertainty
regarding (a) when the Special Committee will complete its work, (b) what the
results of that work will be, and (c) whether the Special Committee's work will
have a related impact on previously stated financial statements, Arthur
Andersen's auditor reports related to the consolidated financial statements of
CMS Energy and subsidiaries as of and for the years ended December 31, 2000 and
2001 cannot be relied upon. Arthur Andersen further advised that given the
current situation at Arthur Andersen and the uncertain timing of when the
Special Committee will complete its work, that Arthur Andersen would be unable
to issue an opinion on the proposed restated financial statements as of and for
the years ended December 31, 2000 and 2001.
This letter applies only to Arthur Andersen's auditor reports related to the
consolidated financial statements of CMS Energy and subsidiaries as of and for
the years ended December 31, 2000 and 2001, and not to the separate audited
financial statements of Consumers and Panhandle for those years.
Arthur Andersen's reports on the Company's consolidated financial statements for
each of the fiscal years ended December 31, 2001 and December 31, 2000 did not
contain an adverse opinion or disclaimer of opinion, nor were they qualified or
modified as to uncertainty, audit scope or accounting principles.
During the fiscal years ended December 31, 2001 and December 31, 2000, and
through the date hereof, there were no disagreements with Arthur Andersen on any
matter of accounting principle or practice, financial statement disclosure, or
auditing scope or procedure which, if not resolved to Arthur Andersen's
satisfaction, would have caused Arthur Andersen to make reference to the subject
matter in connection with its report to the Audit Committee of the Board, or its
report on the Company's consolidated financial statements for such years.
Except as described above with respect to Arthur Andersen's indication that its
auditor reports related to the consolidated financial statements of CMS Energy
and subsidiaries as of and for the years ended December 31, 2000 and 2001 cannot
be relied upon, there were no reportable events as defined in Item 304(a)(1)(v)
of Regulation S-K. The Chairman of the Audit Committee of the Board of Directors
of CMS Energy has discussed this event with Arthur Andersen. CMS Energy has
authorized Arthur Andersen to respond fully to the inquiries of Ernst & Young
concerning this event.
During the Company's two most recent fiscal years ended December 31, 2000 and
December 31, 2001 and the subsequent interim period through June 10, 2002, the
Company did not consult with Ernst & Young regarding any matter or event
identified in Item 304(a)(2)(i) or (ii) of Regulation S-K.
The Company provided Arthur Andersen with a copy of the foregoing disclosures.
Attached as Exhibit 16.1 is a copy of Arthur Andersen's letter dated June 10,
2002.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
16.1 Arthur Andersen Letter dated June 10, 2002 confirming receipt of
foregoing disclosures.
99.1 Arthur Andersen Letter dated June 10, 2002 ceasing client-auditor
relationship.
99.2 Arthur Andersen Letter dated June 10, 2002 regarding Opinion Letters
for the years ending 2000 and 2001.
FORWARD LOOKING STATEMENTS
This Form 8-K contains "forward-looking statements" that are subject to risks
and uncertainties. They should be read in conjunction with the "Forward-Looking
Statement Cautionary Factors" in CMS Energy's, Consumers' and Panhandle's Form
10-K, Item 1 (incorporated by reference herein) that discusses important factors
that could cause CMS Energy's, Consumers Energy's and Panhandle's results to
differ materially from those anticipated in such statements.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrants have duly caused this report to be signed on their behalf by the
undersigned hereunto duly authorized.
CMS ENERGY CORPORATION
Dated: June 11, 2002 By: /s/ Alan M. Wright
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Alan M. Wright
Executive Vice President, Chief Financial
Officer and Chief Administrative Officer
CONSUMERS ENERGY COMPANY
Dated: June 11, 2002 By: /s/ Alan M. Wright
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Alan M. Wright
Executive Vice President, Chief Financial
Officer and Chief Administrative Officer
PANHANDLE EASTERN PIPE LINE COMPANY
Dated: June 11, 2002 By: /s/ William J. Haener
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Chairman of the Board
Exhibit Index
16.1 Arthur Andersen letter dated June 10, 2002 confirming receipt of
foregoing disclosures.
99.1 Arthur Andersen Letter dated June 10, 2002 ceasing client-auditor
relationship.
99.2 Arthur Andersen Letter dated June 10, 2002 regarding Opinion Letters
for the years ending 2000 and 2001.