SCOTTSDALE, Ariz. – An independent audit conducted by Deloitte & Touche LLP at the behest of Barrett-Jackson Auction Co. LLC was released today and indicates the classic car auctioneers complied with proper auction practices during the 2008-2009 season.
Barrett-Jackson ordered the audit to clear any doubts that may have lingered after a 2007 legal action in which a consignor alleged the Arizona auction house had engaged in improper auction activities. Barrett-Jackson, in turn, brought a suit against the consignor, which led to a settlement and exoneration of all allegations against the auction firm.
“The release of this report is part of Barrett-Jackson’s continued commitment to transparency in our auction practices,” said Craig Jackson, chairman and CEO of Barrett-Jackson. “Particularly in light of stories that have surfaced recently concerning business practices at other car auction companies, we felt the time was right to have an independent review and validation of our auction practices.”
Deloitte & Touche performed the examination of Barrett-Jackson’s auction records during the summer of 2009. The project, an “attestation” in formal terms, centered on a review of the “assertions” made by Barrett-Jackson’s management team that summarize the company’s auction-related business practices.
The examination covered Barrett-Jackson’s last full auction season, which included the 2008 Las Vegas event as well as the 2009 events in Scottsdale and West Palm Beach. The final Independent Accountants’ Report is dated September 17, 2009, and was issued by Deloitte & Touche to Barrett-Jackson on September 29, 2009.
The cover letter addressed to the Board of Directors of Barrett-Jackson Auction Company, LLC reads, in part, “We have examined management’s assertions, included in the accompanying Barrett-Jackson Auction Assertions and Criteria listing, that Barrett-Jackson Auction Company, LLC complied with specific criteria listed in the aforementioned listing for their Las Vegas, Nevada auction, which occurred in October 2008, the Scottsdale, Arizona auction, which occurred in January 2009, and the Palm Beach, Florida auction, which occurred in April 2009…In our opinion, Barrett-Jackson complied in all material respects with the aforementioned assertions and criteria for the auctions noted above.”
Craig Jackson said his company enlisted the services of Deloitte & Touche to conduct the independent probe “because they are a world class, globally recognized professional services and auditing firm…We wanted to send a clear message about the seriousness of this project…”
Barrett-Jackson’s president, Steve Davis, remarked, “Barrett-Jackson is proud of its ethical business practices and dedication to transparency, integrity and fairness in conducting the company’s collector car auctions. Particularly in these times of economic turbulence and distrust of the country’s financial institutions, we felt that it was a good time to take this proactive step to demonstrate to our customers and others who follow Barrett-Jackson that we offer a fair, trustworthy forum for buying or selling a collector car. It is rewarding to receive this third-party validation that Barrett-Jackson is a place where transparency is honored and customers are treated fairly.”
Topics reviewed by Deloitte & Touche in the project included: validity and consistency of Barrett-Jackson’s consignment procedures, accurate documentation of the terms of each sale, consistent and documented commission structure on both buyer and seller side, and timely payment of proceeds to consignors.
Davis said he encourages other classic car auction houses to initiate similar independent audits as a sign of good faith to collectors.
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