Inventory
653 deficiencies · 24 led to a wrong opinion · 108 on a significant-risk area
How audits fail in Inventory
The recurring ways firms fell short. Click any one to read the real inspection findings.
- Little or no substantive testing129
The firm performed little or no substantive testing over the account, disclosure, or assertion.
2 wrong opinion26 significant risk - Controls not identified or tested122
The firm didn't identify and/or test controls it needed to rely on for the account or assertion.
6 wrong opinion6 significant risk - Accuracy/completeness of client data not tested111
The firm used issuer-prepared schedules, reports, or system data without testing that they were accurate and complete.
3 wrong opinion18 significant risk - IT general controls not tested62
The firm relied on automated or IT-dependent controls but didn't adequately test the underlying IT general controls (e.g. change management).
1 wrong opinion17 significant risk - Estimate assumptions not evaluated54
The firm didn't sufficiently evaluate the reasonableness of the significant assumptions behind an estimate.
3 wrong opinion16 significant risk - Management review controls not fully evaluated52
The firm tested a management review control but didn't evaluate the specific procedures the reviewer performed, or the control's precision.
5 wrong opinion9 significant risk - Other testing deficiency49
A deficiency that doesn't fall into one of the more specific patterns above.
1 wrong opinion8 significant risk - Sample too small or unsupported30
The sample the firm tested was too small, or the basis for the sample size didn't support the conclusion.
3 wrong opinion5 significant risk - Estimate method, model, or data not evaluated24
The firm didn't evaluate the method, model, or underlying data the issuer used to develop an estimate or fair value.
2 significant risk - Confirmations / alternative procedures8
The firm didn't obtain confirmations, or didn't perform sufficient alternative procedures when confirmations weren't returned.
1 significant risk - Accounting or disclosure treatment not evaluated7
The firm didn't evaluate whether the accounting or disclosures conformed with GAAP, or didn't identify departures from GAAP or omitted disclosures.
- Journal entries / fraud procedures5
Deficiencies in testing journal entries or in responding to identified fraud risks.