USANA's auditor resigns for no reason

The independent auditors of public companies don't resign for no reason, but USANA Health Sciences (NASDAQ: USNA) would like you to believe that Grant Thornton LLP did just that.

In a press release announcing the departure of the auditor, USANA said that the "Audit Committee and Grant Thornton did have an initial disagreement regarding the appropriate scope of review procedures following unfounded, third-party allegations that appeared in the media in March 2007. That difference of opinion was resolved to the satisfaction of Grant Thornton, the Company, and its Audit Committee."

Sure it was! That's why they resigned! In other words: "My wife and I were having marriage problems, but we found a wonderful therapist to help us work through them. We resolved our marital issues, and then we got divorced."

USANA's explanation just doesn't make any sense, which probably explains why the company pre-announced its estimate-beating earnings by one day and used them to bury the news of the auditor's resignation -- The pre-announcement came two minutes after the news of the auditor's resignation.

Earlier this year, Barry Minkow posed the following question to investors in his piece about the top 10 apparent misrepresentations in USANA's most recent conference call:

Sure, USANA beat the estimates, and the stock traded up after hours accordingly. It could trade up tomorrow as well. But the questions about USANA are not about this quarter. The tenability and legality of the business model are what is in question, and beating estimates by 3 cents doesn't change that.