* READER'S DIGEST ENGAGES E&Y: Publishing giant Reader's Digest Association hired Ernst & Young as its new auditor for its fiscal year ending June 30, 2006.Ernst succeeds Big Four firm KPMG as Reader's Digest's new independent accountant.

According to a federal filing, KPMG declined to stand for re-election. However, Pleasantville, N.Y.-based RDA reported no disagreements with its former auditor on matters of accounting principles.

* HPI DISMISSES KPMG: Home Products International dismissed its auditor, Big Four firm KPMG, and named McGladrey & Pullen as its successor.

A filing with the Securities and Exchange Commission reported no disagreements between Chicago-based Home Products and KPMG over accounting matters.

However, KPMG told the client's audit committee about a deficiency in controls over income tax provisions and deferred accounts, prompting the company to restate its earnings for the past fiscal year and the first quarter ended April 2.

* DATASTREAM HIRES BDO: Datastream Systems Inc., a South Carolina manufacturer of financial software, hired BDO Seidman as its new independent accountant.

BDO replaces Big Four firm KPMG as Datastream's auditor.

In a federal filing, Datastream reported no disagreements with KPMG. However, the Big Four firm noted that Datastream didn't have effective internal controls over financial reporting, which was disclosed as a footnote in the annual report.

* REIT JETTISONS E&Y: Prime Group Realty Trust, a Chicago-based real estate investment trust, dismissed Ernst & Young as its independent accountant and hired Grant Thornton as its replacement.

In a filing, no reason was given for the change in auditors.

Prime Group reported no disagreements with Ernst on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure for fiscal years 2003 and 2004.

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