The Public Company Accounting Oversight Board’s (PCAOB) latest batch of 2021 audit inspection reports included a setback in results for Marcum largely related to the firm’s work dealing with special purpose acquisition companies (SPACs).

Of five firms inspected annually whose reports were published Monday, Marcum fared the worst, with 15 of its 25 audits reviewed recording deficiencies. The problem identified most frequently—11 times—was the firm’s insufficiency evaluating the appropriateness of an issuer’s accounting method or disclosure for one or more transactions or accounts.

Audit areas with frequent deficiencies included equity and equity-related transactions (nine) and revenue and related accounts (four).

In Marcum’s inspection report, the PCAOB identified 11 audits with multiple deficiencies. Of the group, six were SPACs, a method for companies to go public outside the traditional initial public offering route.

When SPACs began to boom in 2021, Marcum emerged as the largest auditor of the business combination vehicles. SPACs have since faded in frequency but remain a popular method of going public fraught with business risks.

In each SPAC audit noted for containing multiple deficiencies in Marcum’s inspection report issues related to warrants and equity. Regarding warrants, Marcum commonly failed to ensure the issuer’s accounting for warrants as equity conformed with the Financial Accounting Standards Board’s (FASB) standard for derivatives and hedging (Topic 815). Regarding equity, the firm failed to ensure issuers met FASB’s standard for distinguishing liabilities from equity (Topic 480).

One SPAC audit inspected also contained deficiencies regarding forward purchase agreements.

“The firm respects and values the PCAOB’s inspection process, which through formal communications and through interactions with PCAOB staff helps us identify areas where we can continue to improve and strengthen audit quality to the benefit of investors, other stakeholders, and the capital markets in general,” said Marcum in its response included in the report. “As we have after every inspection, we carefully considered the matters brought to our attention in connection with the 2021 inspection and have taken actions to enhance our policies and procedures as part of our commitment to the highest standards of audit quality.”

Marcum’s 2020 inspection results were similarly problematic, with nine of its 14 audits reviewed returning deficiencies.

Among other firms whose reports were posted Monday, Cohen & Company had just one of nine audits reviewed returning deficiencies. Crowe had 14 of 17 audits reviewed come back clean.

Ten of 14 Moss Adams audits inspected were without deficiencies, while RSM saw notable year-over-year improvement with only four of 17 audits flagged for issues. Seven of RSM’s 15 audits inspected last year included deficiencies.

Withum also had its inspection report published—its first review year since 2019. The firm had 13 of its 17 audits reviewed flagged for deficiencies, including six SPAC audits containing multiple issues.

The PCAOB in December published its 2021 inspection reports for the Big Four.