SEC Audit Practice

MaloneBailey is a market leader in the delivery of SEC audit services to small and mid-cap publicly traded clients, with over 140 registrants, many of which are NYSE, NASDAQ and AMEX listed. MaloneBailey audits more microcaps than any other firm.  As a result, MaloneBailey, alongside various global firms including the “Big Four,” is one of only ten firms in the world that is inspected annually by the Public Company Accounting Oversight Board.

By early 2001, John and Sterling had 13 SEC clients and 1 non-partner employee. We then hired a third partner specifically to serve our growing SEC practice niche and instituted a number of changes to the standard CPA firm practice model to maximize the efficiencies that the smaller SEC companies require: lower costs, faster service and more competent work product.

Small public company audits make up about 75% of our practice. This niche focus has enabled us to develop a thorough understanding of small public company audit complexities and offer high quality and efficient audits. Our commitment to deliver small public company audit services has enabled our practice to become one of the largest SEC practices in the U.S. and still growing.

The public company audit practice is built around the reality that small public companies have unique debt and equity transactions that neither private nor larger public companies have. Such transactions are frequently complex, requiring an in-depth knowledge of the attendant rules that only comes from frequent practice and study.

Our small public clients are risk takers who are running smaller, flatter organizations with full focus on “making it.” They typically do not have significant accounting departments and the owner/operators are almost always directly involved in the accounting and bookkeeping processes.

Small public company audits require firms that focus on transactions auditing, versus the big firm “systems” auditing approach. Our entire team understands this important nuance and we’re versed in the very detailed work of transactional auditing.

We specialize in small public companies because there are few firms who understand them. Even the SEC and PCAOB have less experience with small publics than with larger public organizations.  ‘One Size Fits All’ remains the regulators’ credo and virtually all of the rules and procedures are designed with big firms in mind, because 99% of total market capitalization is large companies audited by large firms.  Some of these rules fit smaller firms and smaller auditing environments well, and some not so much.  We are given very little flexibility in their application and our job is making them fit.

The small public market is underserved, and perhaps, over-billed in the area of audit—and we greatly enjoy the work. That’s why it’s our mission to be the market leader delivering high-quality small and mid-size public company audit and tax services. 

Our public company audit practice is built around the reality that small public companies have unique debt and equity transactions that neither private nor larger public companies have. Such transactions are frequently complex, requiring an in-depth knowledge of the attendant rules that only comes from frequent practice and study.

MaloneBailey is the only firm in North America that focuses on the smaller U.S. public companies with multiple audit partners dedicated to this specialty area.

Our public company audit services include:

  • SEC and NASD regulated audited annual reporting and un-audited interim reporting for reporting companies (‘34 Act compliance)
  • Registration statements and IPOs (‘33 Act compliance)
  • Assistance with the planning process (SEC forms S-1, SB-2, 10-K, 10-Q, 8-K, etc.)
  • M & A financial due diligence
  • Preparation of pro-forma financial statements
  • Consultation on complex accounting issues (including financial derivatives and FIN 46 consolidations)

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