How audits fail in Income Taxes
The recurring ways firms fell short. Click any one to read the real inspection findings.
- Little or no substantive testing16
The firm performed little or no substantive testing over the account, disclosure, or assertion.
2 significant risk - Management review controls not fully evaluated11
The firm tested a management review control but didn't evaluate the specific procedures the reviewer performed, or the control's precision.
1 significant risk - Accuracy/completeness of client data not tested10
The firm used issuer-prepared schedules, reports, or system data without testing that they were accurate and complete.
2 significant risk - Estimate assumptions not evaluated9
The firm didn't sufficiently evaluate the reasonableness of the significant assumptions behind an estimate.
- Estimate method, model, or data not evaluated8
The firm didn't evaluate the method, model, or underlying data the issuer used to develop an estimate or fair value.
2 significant risk - Controls not identified or tested6
The firm didn't identify and/or test controls it needed to rely on for the account or assertion.
- Accounting or disclosure treatment not evaluated4
The firm didn't evaluate whether the accounting or disclosures conformed with GAAP, or didn't identify departures from GAAP or omitted disclosures.
1 significant risk - Reliance on a specialist or pricing service1
The firm relied on a specialist, pricing service, or third party without sufficiently evaluating that work.