8-K: United Security Bancshares Appoints Baker Tilly as New Independent Auditor Following Moss Adams Merger

United Security Bancshares announced the appointment of Baker Tilly US, LLP as its new independent registered public accounting firm, succeeding Moss Adams LLP, following the merger of Moss Adams with Baker Tilly.

Summary

• United Security Bancshares (UBFO) was notified on June 4, 2025, that its independent registered public accounting firm, Moss Adams LLP, merged with Baker Tilly US, LLP, effective June 3, 2025.
• As a result of the merger, Moss Adams LLP resigned as the company's auditors.
• The Audit Committee of the Company's Board of Directors approved the appointment of Baker Tilly US, LLP as the successor independent registered public accounting firm.
• Audit reports issued by Moss Adams on the company's consolidated financial statements for the years ended December 31, 2024, and 2023, did not contain any adverse opinions, disclaimers, qualifications, or modifications.
• There were no disagreements with Moss Adams on accounting principles, financial statement disclosure, or auditing scope/procedure during the years ended December 31, 2024 and 2023, or the subsequent interim period through June 4, 2025.
• No reportable events requiring disclosure pursuant to Item 304(a)(1)(v) of Regulation S-K occurred during the specified periods.
• Neither the company nor anyone on its behalf consulted with Baker Tilly regarding accounting principles, audit opinions, disagreements, or reportable events prior to their appointment.
• Moss Adams LLP provided a letter to the SEC, dated June 4, 2025, confirming their agreement with the statements made by United Security Bancshares in the Form 8-K.

Sentiment

Score: 7

Explanation: The sentiment is positive because the auditor change is due to a merger, not performance issues or disagreements. The company explicitly states no adverse opinions, disclaimers, or reportable events, indicating a clean transition and continued good standing.

Positives

• The transition of the independent auditor was due to a merger of the previous firm, not due to any disagreements or issues with the company's financial reporting.
• Moss Adams' audit reports for 2023 and 2024 were unqualified, indicating no material issues with the company's financial statements.
• There were no disagreements on accounting principles or practices, financial statement disclosure, or auditing scope or procedure with the outgoing auditor, Moss Adams LLP.
• No reportable events were identified during the periods under review, indicating a clean audit history with the previous firm.

Risks

• While the transition appears smooth, any change in a company's independent auditor carries an inherent, albeit minor, risk of disruption to the audit process or a learning curve for the new firm, which could potentially impact future audit timelines or findings.

Future Outlook

The document primarily addresses a change in the company's independent auditor due to a merger and does not provide specific forward-looking statements or financial guidance regarding the company's operations or performance.

Management Comments

• David A. Kinross, Senior Vice President and Chief Financial Officer, signed the report on behalf of United Security Bancshares, indicating the company's official acknowledgment and filing of the auditor change.

Industry Context

The merger of accounting firms is a common occurrence in the professional services industry, often leading to changes in audit engagements for their clients. This specific change reflects a consolidation within the auditing sector, with Baker Tilly expanding its market presence. For financial institutions like United Security Bancshares, maintaining a reputable and independent auditor is crucial for regulatory compliance and investor confidence.

Comparison to Industry Standards

• The transition of auditors due to a merger of accounting firms is a standard practice in the industry, aligning with typical corporate governance procedures when such events occur.
• The absence of disagreements or reportable events with the outgoing auditor, Moss Adams LLP, is consistent with best practices for a smooth and non-contentious auditor change, similar to transitions seen with other financial institutions like JPMorgan Chase & Co. or Bank of America when their auditors undergo significant structural changes or mergers.
• The prompt disclosure via an 8-K filing adheres to SEC requirements for material events, ensuring transparency to shareholders and regulators, a standard followed by all publicly traded companies.

Corporate Governance

Stakeholder Impact

• Shareholders: The smooth transition of auditors, without any reported disagreements or issues, provides assurance regarding the integrity of the company's financial reporting and continued compliance with regulatory standards.
• Employees: No direct impact on employees is indicated by this filing.
• Customers: No direct impact on customers is indicated by this filing.
• Suppliers: No direct impact on suppliers is indicated by this filing.
• Creditors: The continuity of a reputable independent audit firm provides creditors with ongoing assurance regarding the reliability of the company's financial statements.

Next Steps

• Baker Tilly US, LLP will serve as the independent registered public accounting firm for United Security Bancshares for future audit periods.

Key Dates

Keywords

SEC filing, 8-K, auditor change, independent registered public accounting firm, Moss Adams LLP, Baker Tilly US LLP, United Security Bancshares, UBFO, financial reporting, corporate governance, audit committee