Corporate Finance

Tribune Publishing Dumps CFO, Auditor

Weak internal controls sealed the fate of the finance chief and auditor PwC.
Katie Kuehner-HebertMarch 29, 2016

Tribune Publishing, owner of the Chicago Tribune and the Los Angeles Times, has fired its chief financial officer and its auditor, PricewaterhouseCoopers, after finding an “ineffective control environment” within the company’s financial reporting operations.

The Chicago-based publisher said in an SEC filing that outgoing CFO Sandra Martin would be replaced by Terry Jimenez, 43, on April 4. Martin would leave the company on April 15.

Jimenez, most recently an executive at IBM, also formerly held the positions of president, chief operating officer, and CFO in the late 2000s at New York newspaper Newsday, a unit of Cablevision Systems, according to Crain’s. He was also a consultant to Wrapports, the parent of the Chicago Sun-Times, and controller at the Chicago Tribune from 2003 to 2005.

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In a separate filing, Tribune Publishing said it would hire Ernst & Young to replace PwC as its auditor. While the filing said there were “no disagreements” between the publisher and PwC, it did disclose material weaknesses in the company’s internal controls over financial reporting.

The ineffective controls “contributed to material weaknesses related to review and approval of insert volume forecasts and variance analysis for preprint advertising, documentation of approval of rates for circulation and other revenue, and the review of compensation expense, including sales commissions and bonus plans,” the filing said.

Tribune Publishing also found that the company had ineffective cybersecurity. The audit committee has authorized PwC “to respond fully to the inquiries of the successor independent registered public accounting firm concerning these matters,” according to the filing.