Rachlin, Cohen & Holtz in Miami moved from 66 to 33 on Bowman’s list of America’s top auditors this year. Several years ago RCH began working on 401(k) audits and tax work banned by Sarbanes-Oxley, and this has been a contributor to their success. RCH is also analyzing its client base to determine which are too risky to keep. Competition is getting stronger because firms are aggressively pursuing better clients.

Stark Winter Schenkein & Co. in Denver (with an office in Bradenton, Florida) is a firm of 16 professionals that has benefited from the abandonment of SEC clients by small firms concerned about increased risk and SOX regulations. SWS is experiencing less competition for these kinds of clients. There is an increasing incidence of small IPOs and reverse acquisitions, which are of little interest to the big 4.

Marcum & Kliegman, in Mellville, New York, developed a formal SEC practice in 2000, including technical expertise plus branding. Four years ago M&K had eight or nine public company clients. Today it has 52. M&K’s marketing initiatives include meetings with investment bankers and public speaking. SOX has forced many smaller firms out of the SEC business. M&K is involved in reverse mergers, private investments in public equity, and special purpose acquisition corporations. Because public companies are unhappy with big 4 fees and services, M&K is not sure it can keep up with the number of opportunities coming to it.

There are 1,700 firms (including foreign affiliates of the big 4) registered with the PCAOB.

According to Who Audits America, there are 135 public companies without auditors. Companies are searching for auditors that offer the optimum combination of price and service.

From Bowman’s First Alert Vol. III No. 15, August 11, 2006, Bowman Communications, 323 Wilcrest Drive SW, Atlanta, Georgia 30044-5253, 770-972-0783.