It may be called The Westerly Sun but this paper is throwing nothing but shade at Marcum.
Concerns over the reputation and legal troubles surrounding the audit firm Marcum LLP have led members of the Chariho School Committee to terminate its contract, moving in a different direction for the first time in 18 years.
Members of the School Committee voted 11-0 on Tuesday, with Donna Chambers abstaining, to terminate the contract with James Wilkinson of Marcum LLP. The committee then voted unanimously to award the bid to the next qualified firm, Hague, Sahady & Co., PC.
“It comes down to a reputation issue; the issues that were pointed out in such a high percent of audits coming from the firm,” said member Tyler Champlin, who had requested the agenda item alongside Chairwoman Catherine Giusti and motioned for the dismissal of Marcum LLP.
“You aren’t going to go to a doctor with a 25-50% mortality rate, at least most people wouldn’t,” he said. “Knowing that this company has had an issue with a member town (Charlestown) as well, I’m not comfortable with it at this point.”
We wrote about the issue with a member town previously. Marcum sent tiny little Charlestown, Rhode Island an unitemized $55,992 bill for out of scope services on the town’s 2022 audit, the town council was furious, Marcum kept dodging them when they asked for an explanation of fees, and eventually the town threw them $18,000 to settle the matter. Obviously they’re no longer a client.
This of course pales in comparison to the bigger issue of the PCAOB and SEC hitting Marcum with huge fines in June for taking on too many clients and failing to perform the work with the required level of professional competence. No really, the PCAOB’s press release about it uses the word “competence” four times.
- Marcum’s quality control system did not provide reasonable assurance that it could execute these audits with competence.
- “Firms have a responsibility to undertake only those engagements that they can reasonably expect to be completed with professional competence,” said Robert E. Rice, Director of the PCAOB’s Division of Enforcement and Investigations.
- The PCAOB found that Marcum LLP’s system of quality control failed to provide reasonable assurance that the firm would:
- Undertake only those issuer engagements that the firm could reasonably expect to be completed with professional competence and appropriately consider the risks associated with providing professional services in the particular circumstances;
- Ensure that partner workloads were manageable to allow sufficient time for engagement partners and engagement quality review partners to discharge their responsibilities with professional competence and due care;
Sucks for them but it sure is funny for us!