Applied Digital's Auditor Change Reveals Previous Internal Control Weaknesses

Rhea-AI Filing Summary

Applied Digital Corporation (APLD) announced a change in its independent registered public accounting firm. On June 18, 2025, Marcum LLP resigned following its attest business acquisition by CBIZ CPAs P.C. effective November 1, 2024. CBIZ CPAs was subsequently appointed as the company's new auditor with Audit Committee approval.

Key points regarding the transition:

• Marcum's audit reports for FY2023 and FY2024 contained no adverse opinions or modifications
• No disagreements existed between Marcum and Applied Digital on accounting principles, practices, or procedures
• A material weakness in internal control over financial reporting was disclosed in FY2024 Annual Report
• No prior consultations occurred between Applied Digital and CBIZ CPAs regarding accounting principles or audit opinions

The company has filed Marcum's letter dated June 20, 2025, confirming these statements as Exhibit 16.1.

Positive

• None.

Negative

• Material weakness in internal control over financial reporting disclosed in FY2024 Annual Report
• Change in independent auditor from Marcum LLP to CBIZ CPAs, which could temporarily impact audit timelines and processes

8-K Event Classification

2 items: 4.01, 9.01

2 items

Item 4.01 Changes in Registrant's Certifying Accountant Governance

The company changed its independent auditing firm, which may involve disagreements on accounting matters.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

June 18, 2025

(Date of earliest event reported)

APPLIED DIGITAL CORPORATION

(Exact name of registrant as specified in its charter)

Nevada		001-31968		95-4863690
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

3811 Turtle Creek Boulevard, Suite 2100, Dallas, Texas		75219
(Address of principal executive offices)		(Zip Code)

214-427-1704

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

	☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
	☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
	☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
	☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

☐ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock		APLD		Nasdaq Global Select Market

Item 4.01. Changes in Registrant’s Certifying Accountant.

CBIZ CPAs P.C. (“CBIZ CPAs”) acquired the attest business of Marcum LLP (“Marcum”), effective November 1, 2024. As a result of this transaction, on June 18, 2025, Marcum resigned as the independent registered public accounting firm of Applied Digital Corporation (the “Company”) and, with the approval of the Audit Committee of the Company’s Board of Directors, CBIZ CPAs was engaged as the Company’s independent registered public accounting firm for the year ended May 31, 2025.

The audit reports of Marcum regarding the Company’s financial statements for the fiscal years ended May 31, 2024 and 2023 did not contain any adverse opinion or disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope, or accounting principles.

During the years ended May 31, 2024 and 2023, and through June 18, 2025, the date Marcum informed the Company of their resignation, there were (a) no disagreements (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) with Marcum on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of Marcum, would have caused Marcum to make reference to such disagreement in its report and (b) no “reportable events” (as defined in Item 304(a)(1)(v) of Regulation S-K and the related instructions, except for the material weakness in the Company’s internal control over financial reporting related to financial reporting as disclosed in the Company’s Annual Report for the fiscal year ended May 31, 2024).

During the fiscal years ended May 31, 2024 and 2023 and through June 18, 2025, the date Marcum informed the Company of their resignation, neither the Company nor anyone on the Company’s behalf consulted with CBIZ regarding (i) the application of accounting principles to a specific completed or contemplated transaction or regarding the type of audit opinions that might be rendered by CBIZ on the Company’s financial statements, and CBIZ did not provide any written or oral advice that was an important factor considered by the Company in reaching a decision as to any such accounting, auditing, or financial reporting issue or (ii) any matter that was either the subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions), as that term is described in Item 304(a)(1)(iv) of Regulation S-K, or a reportable event, as that term is defined in Item 304(a)(1)(v) of Regulation S-K.

The Company provided Marcum with a copy of this Current Report on Form 8-K prior to its filing with the U.S. Securities and Exchange Commission (the “SEC”) and requested that Marcum furnish the Company with a letter addressed to the SEC, pursuant to Item 304(a)(3) of Regulation S-K, stating whether it agrees with the above statements and, if it does not agree, the respects in which it does not agree. A copy of the letter, dated June 20, 2025, is filed as Exhibit 16.1 (which is incorporated by reference herein) to this Current Report on Form 8-K.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.		Description
16.1		Letter from Marcum dated June 20, 2025
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURE

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: June 20, 2025	By:	/s/ Saidal L. Mohmand
	Name:	Saidal L. Mohmand
	Title:	Chief Financial Officer

FAQ

Why did APLD change its auditor in June 2025?

APLD's auditor changed because CBIZ CPAs P.C. acquired the attest business of Marcum LLP (their previous auditor) effective November 1, 2024. As a result, Marcum resigned on June 18, 2025, and CBIZ CPAs was appointed as the new independent registered public accounting firm with approval from the Audit Committee.

Were there any issues with APLD's previous auditor Marcum's reports?

No significant issues were reported. Marcum's audit reports for fiscal years ended May 31, 2024 and 2023 did not contain any adverse opinion, disclaimer of opinion, or qualifications regarding uncertainty, audit scope, or accounting principles. However, there was a disclosed material weakness in internal control over financial reporting for the fiscal year ended May 31, 2024.

Did APLD have any disagreements with Marcum before the auditor change?

No, during the years ended May 31, 2024 and 2023, through June 18, 2025, there were no disagreements with Marcum on accounting principles, practices, financial statement disclosure, or auditing procedures that would have caused Marcum to reference such disagreements in their report.

What material weakness did APLD disclose in their FY 2024 Annual Report?

The filing mentions a material weakness in the Company's internal control over financial reporting related to financial reporting, which was disclosed in APLD's Annual Report for the fiscal year ended May 31, 2024. However, specific details about the nature of this material weakness are not provided in this 8-K filing.

Did APLD consult with CBIZ CPAs before appointing them as the new auditor?

No, during fiscal years ended May 31, 2024 and 2023 through June 18, 2025, neither APLD nor anyone on their behalf consulted with CBIZ regarding accounting principles, audit opinions, or any matters involving disagreements or reportable events. CBIZ did not provide any written or oral advice that was an important factor in APLD's financial decisions.