Leslie's, Inc. Replaces Auditor EY with Grant Thornton Amidst Persistent Internal Control Weaknesses
LESL is trading near its 52-week low of $1.36 (12% above the low).
Summary
Leslie's, Inc. has changed its independent auditor from Ernst & Young to Grant Thornton, a move that follows EY's adverse opinions on the company's internal controls for two consecutive years due to material weaknesses.
Key Events · Corporate Governance and Compliance · LESL
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Auditor Change Approved
The Audit Committee appointed Grant Thornton LLP as the new independent registered public accounting firm for the fiscal year ending October 3, 2026.
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Ernst & Young Dismissed
Ernst & Young LLP (EY) was dismissed as the company's auditor, effective upon completion of their interim review for the quarter ended January 3, 2026.
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Persistent Internal Control Weaknesses
EY had issued adverse opinions on the company's internal control over financial reporting for fiscal years 2024 and 2025, citing material weaknesses in inventory, asset impairment, and vendor rebate processes.
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No Other Disagreements Cited
The company stated there were no other "disagreements" or "reportable events" with EY, as defined by Regulation S-K, beyond the disclosed material weaknesses.
Analysis · LESL · Trade & Services
This 8-K details Leslie's, Inc.'s decision to appoint Grant Thornton LLP as its new independent auditor, replacing Ernst & Young LLP (EY). While the company states there were no disagreements with EY on accounting principles or audit scope, EY had issued adverse opinions on the company's internal control over financial reporting for both the 2024 and 2025 fiscal years due to material weaknesses. These weaknesses related to inventory, asset impairment, and vendor rebate processes. The change in auditor, following persistent issues with internal controls, adds to existing concerns about the company's financial reporting integrity and operational oversight. Investors should monitor the new auditor's findings and the company's progress in remediating these control deficiencies.
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At the time of this filing, LESL was trading at $1.53 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $13.6M. The 52-week trading range was $1.36 to $46.40. This filing was assessed with negative market sentiment and an importance score of 7 out of 10.