Yes it is working perfectly fine because it is easier to find those people who are here for merit farming and here because they really want to learn about bitcoin and other alternate cryptocurrencies. I have found some people who are cheating although it is just a minor give and take merits but imagine if they have 5 - 10 alt account and placed in just one signature campaign. Even if they are just members or full members they can still get a lot of $ out of one campaign.
Merit has helped the forum in following ways:
1) New members are also making detailed and to the point posts to earn more merits. This is improving the quality of posts on this forum which will bring more traffic and advertisers.
2) Some people tried to cheat the merit system by giving merit points to their alt accounts. Most of them got identified and were punished. Thus, the merit system also helped to find out alt accounts here.
3) Merit system is also good for the companies having signature campaigns here. There signature will appear on high quality posts now.