Mayer Hoffman McCann Agrees to Pay Penalty

Leawood, Kan.-based Mayer Hoffman McCann (FY11 net revenue of $598 million) has agreed to pay a $300,000 penalty to the California Board of Accountancy for its municipal audits of Bell, where eight former city officials are facing public corruption charges, Accounting Today reported.

In addition to the penalty, the settlement says the firm could pay investigation costs of up to $50,000 and be subject to two years of probation. The firm, which is affiliated with CBIZ, will be allowed to continue to practice in the state of California. “MHM appears to have been a rubberstamp rather than a responsible auditor committed to providing the public with the transparency and accountability that could have prevented the mismanagement of the city’s finances by Bell officials,” State Controller John Chiang said in a statement. Chiang noted that the firm had relied primarily on comparisons to prior-year financial statements, requesting information on variances in excess of $200,000 and 15% from the prior year. MHM president William Hancock said in a statement that the firm has “implemented a wide array of improvement measures in response to the current city and municipal audit environment, including enhancement of our government audit methodology and processes, and additional continuing education programs and training for our professionals.”