HARTCOURT - Germany/Europe

[Franz Beckenbauer II]

Thursday , January 06, 2005 13:28 ET

The Hartcourt Companies, Inc. (OTCBB : HRCT) filed an 8-K today, in which the Company reported that on 12/29/04, Loral International Certified Public Accountants informed The Hartcourt Companies, Inc that it resigned as the independent public auditor for the Company and its subsidiaries effective immediately.

In connection with the audits of the Company's most recent two years ended 12/31/03 and 2002 and during the period from 1/1/04 until Loral's resignation, there were no disagreements between Loral and the Company on any matter of accounting principles or practices, financial statement disclosure, or auditing scope and procedures, that, if not resolved to the satisfaction of Loral, would have caused Loral to make reference to the subject matter of the disagreement in connection with its reports on the Company's financial statements for such years.

On 12/30/04, the Audit Committee of the Company's Board of Directors appointed Kabani & Company, Inc. as the Company's registered independent public accounting firm