Auditor changes roundup: 2021 annual summary

Steven Dixon Date published: Mar 29, 22 Last updated: Mar 07, 24

BF Borgers led the way this year gaining 39 new Securities and Exchange Commission (SEC) clients and netting 25. Grant Thornton was second gaining 29 new clients and netting 18 and Deloitte was third, adding 33 new clients and netting 13.

BF Borgers led with the most net clients in Q2, Q3 and Q4 of 2021. The Colorado-based audit firm came in second last year with 21 net new SEC clients.

As mentioned in Accounting Today, client departures outpaced new client engagements for the first time since 2016. Top 20 firm Marcum led with 110 client departures. Marcum is a leader in special-purpose acquisition company (SPAC) audits. SPAC auditors are often dismissed following a SPAC merger or acquisition.

Overall, there were 178 engagements and 265 departures during 2021 among the Big Four and major global and national firms.

Large accelerated filer auditor changes

Deloitte ranked first and Grant Thornton ranked second in terms of new audit fees won during 2021. They brought in $96.1 million and $30.5 million, respectively. Cherry Bekaert snuck into the third spot for the most new audit fees won with $4.9 million despite only gaining four net new clients.

We disaggregate auditor changes by the size of companies gained or lost, as represented by companies’ reported filing status, in the following tables. The first table shows auditor changes for large accelerated filers, i.e those with public float of more than $700 million.

For the fifth year in a row Deloitte was the top firm for large accelerated filer wins. They netted ten new SEC audit clients. Grant Thornton was second netting four new SEC audit clients.

Accelerated filer auditor changes

The next table presents wins and losses for accelerated filers. Accelerated filers are companies with public float between $75 million and $700 million. Companies identifying as an accelerated filer and smaller reporting company are included in the analysis for accelerated filers.

Grant Thornton won the most accelerated filer engagements for the second year in a row with eight net new SEC audit clients in 2021. BKD followed with a net of five SEC audit clients. Deloitte and Malone Bailey both netted two new SEC audit clients.

Non-accelerated filer auditor changes

The last table presents the top gains and losses for smaller reporting companies. Companies in this population are a combination of companies that did not identify as large accelerated filers, accelerated filers, or accelerated and smaller reporting company. For a further disaggregated list by all separate filer statuses, please contact us.

BF Borgers was the top firm among non-accelerated filers and smaller reporting companies with a net of 24 new SEC audit clients. Audit Alliance came in second with a net of 11 new clients.

As mentioned in previous analyses, Withum and Marcum continued to see a large number of departures. There departures were largely due to finalized acquisitions of SPAC clients. This trend has continued throughout 2021.