Mazars USA has cut ties with former President Donald Trump and stated that 10 years’ worth of financial statements that the firm prepared for his company should not be relied upon, Accounting Today reported.
In a Feb. 9 letter to the chief lawyer for the Trump Organization, Mazars said that “the Statements of Financial Condition for Donald J. Trump for the years ending June 30, 2011 - June 30, 2020, should no longer be relied upon.” New York Attorney General Letitia James included the letter in a court filing on Monday in support of document and testimonial subpoenas that her office issued to Trump, the Trump Organization, Donald Trump, Jr and Ivanka Trump. Her office has been investigating what it says was the use of “false and misleading financial statements to obtain financial benefits.” James has charged that Trump inflated the value of at least some of his real estate assets, which in turn enabled him to procure loans, insurance coverage and tax deductions at better rates.
The letter from Mazars states that the firm came to the conclusion that the financial statements were no longer reliable “based, in part, upon the filings made by the New York Attorney General on January 18, 2022, our own investigation, and information received from internal and external sources. While we have not concluded that the various financial statements, as a whole, contain material discrepancies, based upon the totality of the circumstances, we believe our advice to you to no longer rely upon those financial statements is appropriate.”
In its letter, Mazars also said, “As we have stated in the Statements of Financial Condition, Mazars performed its work in accordance with professional standards. A subsequent review of those workpapers confirms this.” The firm added, “Due in part to our decision regarding the financial statements, as well as the totality of the circumstances, we have also reached the point such that there is a non-waivable conflict of interest with the Trump Organization. As a result, we are not able to provide any new work product to the Trump Organization.”
According to the New York Times, the Trump Organization responded by saying that it was disappointed with Mazars’ decision, but it viewed the letter as confirmation that the firm’s “work was performed in accordance with all applicable accounting standards and principles and that such statements of financial condition do not contain any material discrepancies.” The company argued that Mazars’ characterization of its work “effectively renders the investigations by the D.A. and A.G. moot."
The Mazars letter concluded by noting that “there are only a limited number of tax returns that still remain to be filed, including those of Donald J. Trump and Melania Trump. We will be providing you a list of those returns and their status towards completion separately.”