Equus (NYSE: EQS) reports BDO resignation and existing control weaknesses

Rhea-AI Filing Summary

Equus Total Return, Inc. reported that its independent auditor, BDO USA, P.C., resigned effective April 29, 2026. BDO’s audit reports on the Fund’s financial statements for the years ended December 31, 2025 and 2024 were clean, with no adverse opinions or scope or principle qualifications.

The company states there were no disagreements with BDO on accounting, disclosure, or audit procedures and no reportable events other than previously disclosed material weaknesses. These weaknesses relate to management review controls over portfolio valuation and the handling of complex accounting transactions, including warrants. The weaknesses did not cause any identified misstatements but could potentially affect certain accounts and disclosures.

Positive

• None.

Negative

• Auditor resignation: BDO USA, P.C. resigned as Equus Total Return’s independent auditor effective April 29, 2026, which can signal increased governance and oversight uncertainty despite the absence of stated disagreements.
• Material weaknesses in internal control: The company reiterates previously disclosed material weaknesses in management review controls over portfolio valuation and complex accounting transactions, including warrants, which could potentially lead to misstatements in financial statement accounts and disclosures.

Insights

Audit & governance analyst

Auditor resignation plus existing control weaknesses raise governance risk.

Equus Total Return discloses that BDO USA, P.C. resigned as independent auditor, even though BDO issued unqualified opinions for 2025 and 2024 and the company reports no accounting disagreements or new reportable events beyond prior disclosures.

The filing reiterates material weaknesses in internal controls over portfolio valuation and complex transactions such as warrants. While no misstatements were identified, such weaknesses increase the risk that future errors might go undetected until corrected. Investors often view unresolved control issues as a governance concern, especially for investment entities.

The company notes its Audit Committee discussed the matters with BDO and has authorized full cooperation with a successor auditor. Future company filings may indicate whether these control weaknesses are remediated and who is appointed to replace BDO as independent auditor.

8-K Event Classification

2 items: 4.01, 9.01

2 items

Item 4.01 Changes in Registrant's Certifying Accountant Governance

The company changed its independent auditing firm, which may involve disagreements on accounting matters.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

Key Figures

Audit periods: Fiscal years 2025 and 2024 Auditor resignation date: April 29, 2026 Material weaknesses reference year: Year ended December 31, 2025

3 metrics

Audit periods Fiscal years 2025 and 2024 Years for which BDO issued unqualified audit reports

Auditor resignation date April 29, 2026 Effective date of BDO’s resignation as independent auditor

Material weaknesses reference year Year ended December 31, 2025 Period cited in prior Form 10-K for disclosed control weaknesses

Key Terms

independent auditors, material weaknesses, Regulation S-K, portfolio investment valuation, +1 more

5 terms

independent auditors financial

"BDO’s resignation as the Fund’s independent auditors, effective as of such date."

Independent auditors are outside, licensed accountants who examine a company’s books, records and internal controls and issue an objective opinion on whether the financial statements accurately reflect the business’s financial position. Investors treat their report like a neutral inspector’s stamp — it increases trust, makes financial results easier to compare, and alerts readers if there are errors, omissions or other problems that could affect investment decisions.

material weaknesses financial

"except for the identified material weaknesses previously reported in our Annual Report on form 10-K"

Material weaknesses are significant flaws in a company’s systems for ensuring its financial reports are accurate and reliable. Like a broken lock on a safe, they increase the chance that financial statements contain big errors or omissions, which can mislead investors about performance and risk; discovering one often raises questions about management oversight, may lead to restated results, and can affect investor confidence and a company’s valuation.

Regulation S-K regulatory

"no disagreements within the meaning of Item 304(a)(1)(iv) of Regulation S-K"

A set of U.S. Securities and Exchange Commission rules that tell public companies which narrative and qualitative details must be disclosed in filings, such as risk factors, management discussion, executive pay, legal proceedings and business description. Think of it as a standardized checklist or blueprint that ensures investors get the same types of background information from every company so they can compare risks, management quality and strategy before making investment decisions.

portfolio investment valuation financial

"proper management review controls over the valuation of the Fund’s portfolio investment"

complex accounting transactions financial

"controls relating to the measurement and assessment of complex accounting transactions, including warrants."

Understanding 8-K Material Events →

___________________________________________

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 29, 2026

EQUUS TOTAL RETURN, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	814-00098	76-0345915
(State or Other Jurisdiction	(Commission File	(IRS Employer
Of Incorporation)	Number)	Identification No.)

700 Louisiana Street, 41st Floor Houston, Texas	77002
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (713) 529-0900

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-k filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 4.01 Changes in Registrant’s Certifying Accountant.

On April 29, 2026, Equus Total Return, Inc. (“Equus” or the “Fund”) was notified by BDO USA, P.C. (“BDO”), of BDO’s resignation as the Fund’s independent auditors, effective as of such date.

The report of BDO concerning the Fund’s financial statements for the fiscal years ended December 31, 2025 and 2024 did not contain any adverse opinion or a disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principles.

During the year ended December 31, 2025 and through April 29, 2026, the date of BDO’s resignation, there were (a) no disagreements within the meaning of Item 304(a)(1)(iv) of Regulation S-K between the Fund and BDO on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of BDO, would have caused it to make reference to the subject matter of the disagreements in connection with its report and (b) no reportable events (as described in Item 304(a)(1)(v) of Regulation S-K), except for the identified material weaknesses previously reported in our Annual Report on form 10-K for the year ended December 31, 2025. We did not design or implement proper management review controls over the valuation of the Fund’s portfolio investment, including management’s review procedures over the completeness and accuracy of the underlying data and information supplied to third parties assisting management by recommending a range of reasonable fair values. Further, we did not properly design and implement controls relating to the measurement and assessment of complex accounting transactions, including warrants. These deficiencies did not result in a misstatement to our financial statements, however, the deficiencies could result in misstatements potentially impacting certain financial statement accounts and disclosures. The Audit Committee has discussed these matters with BDO. The Company has authorized BDO to fully respond to any inquiries of the successor independent registered accounting firm concerning these matters.

Equus provided BDO with a copy of this Current Report on Form 8-K prior to its filing with the Securities and Exchange Commission, and requested that BDO furnish the Fund with a letter addressed to the commission stating whether it agrees with the statements made by Equus in this Current Report, and if not, stating the aspects with which it does not agree.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

16.1       Letter to the Securities and Exchange Commission from BDO USA, P.C. dated May 4, 2026.

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Equus Total Return, Inc.
Date:  May 4, 2026	By:  /s/ Kenneth I. Denos
	Name: Kenneth I. Denos
	Title: Secretary

3

FAQ

What did Equus Total Return (EQS) announce about its independent auditor?

Equus Total Return reported that BDO USA, P.C. resigned as its independent auditors effective April 29, 2026. BDO had audited the Fund’s financial statements for 2025 and 2024 and issued clean opinions without adverse or qualified conclusions on those periods.

Did BDO issue any adverse opinions on Equus Total Return (EQS) financial statements?

No. BDO’s reports on Equus Total Return’s financial statements for the fiscal years ended December 31, 2025 and 2024 contained no adverse opinion, no disclaimer of opinion, and no qualifications related to uncertainty, audit scope, or accounting principles according to the filing.

Were there disagreements between Equus Total Return (EQS) and BDO before the resignation?

The company states there were no disagreements with BDO on accounting principles, financial statement disclosure, or auditing scope or procedures under Item 304(a)(1)(iv) of Regulation S-K during 2025 and through April 29, 2026, when BDO resigned as independent auditor.

What internal control issues did Equus Total Return (EQS) disclose?

Equus Total Return disclosed material weaknesses in management review controls over portfolio investment valuation and in controls over measuring and assessing complex accounting transactions, including warrants. These weaknesses did not cause identified misstatements but could potentially affect certain financial statement accounts and disclosures.

How is Equus Total Return (EQS) handling communication between BDO and the next auditor?

The company authorized BDO to fully respond to inquiries from any successor independent registered public accounting firm regarding the disclosed matters. Equus also requested a letter from BDO to the SEC stating whether it agrees with the company’s descriptions in the current report.

Do the material weaknesses at Equus Total Return (EQS) relate to portfolio valuation?

Yes. The company reports it lacked properly designed and implemented management review controls over portfolio valuation, including review of data supplied to third parties assisting with fair value ranges, which is a key internal control area for an investment-focused fund.

Filing Exhibits & Attachments

1 document

Other Documents

• EX-161 LETTER TO SECURITIES AND EXCHANGE COMMISSION FROM BDO USA, P.C. 4.5 KB