8-K: Establishment Labs Appoints CBIZ as New Independent Auditor Following Marcum LLP Acquisition

Establishment Labs Holdings Inc. has appointed CBIZ CPAs P.C. as its new independent registered public accounting firm following Marcum LLP's acquisition by CBIZ.

Summary

• Establishment Labs Holdings Inc. announced the resignation of Marcum LLP as its independent registered public accounting firm on May 20, 2025.
• The resignation was a result of CBIZ CPAs P.C.'s acquisition of Marcum's attest business on November 1, 2024.
• The Audit Committee approved the appointment of CBIZ as the company's new independent registered public accounting firm on the same day.
• Marcum's audit reports for the years ended December 31, 2024, and December 31, 2023, did not contain any adverse opinions, disclaimers, or qualifications.
• There were no disagreements between the company and Marcum on accounting principles or practices during the specified periods, except for a material weakness in internal controls over IT general controls for the fiscal year ended December 31, 2023.
• The company filed a proxy supplement on May 21, 2025, to reflect the change in auditors for its 2025 annual meeting of stockholders.

Sentiment

Score: 7

Explanation: The announcement is neutral to slightly positive. The change in auditors is a procedural matter resulting from an acquisition, and there are no indications of any underlying issues with the company's financial reporting. The previously disclosed material weakness is a concern, but it is already known.

Positives

• The transition to a new auditor appears to be smooth, with no reported disagreements on accounting principles or practices.
• Marcum's audit reports for the past two years were clean, indicating sound financial reporting.

Negatives

• A previously disclosed material weakness in internal controls over IT general controls for the fiscal year ended December 31, 2023, is noted.

Risks

• The company will need to ensure a smooth transition with the new auditor, CBIZ, to maintain the integrity of its financial reporting.
• Addressing the previously identified material weakness in internal controls over IT general controls remains a priority.

Future Outlook

The company anticipates CBIZ preparing the report on the company's consolidated financial statements for the fiscal year ending December 31, 2025.

Industry Context

Changes in auditing firms are not uncommon, especially following mergers and acquisitions within the accounting industry. Companies routinely update their proxy statements and SEC filings to reflect such changes, ensuring transparency and compliance with regulatory requirements.

Stakeholder Impact

• Shareholders should be aware of the change in auditors, but it is not expected to have a significant impact on the company's operations or financial performance.
• The company's management will need to work closely with CBIZ to ensure a smooth audit process.

Next Steps

• CBIZ will prepare the audit report for the fiscal year ending December 31, 2025.
• The company will continue to address the material weakness in internal controls over IT general controls.

Key Dates

Keywords

auditor, CBIZ, Marcum, accounting, financial reporting, Establishment Labs