Explorer

The issuer determined the qualitative reserve component of the ALL for loans that were collectively evaluated for impairment. The following deficiencies were identified: · The firm's approach for substantively testing the ALL was to test the issuer's process. The firm did not sufficiently evaluate whether the issuer had a reasonable basis for the significant assumptions it used to determine the qualitative component of the ALL because the firm's procedures were limited to (1) reading the issuer's ALL analysis and (2) comparing the significant assumptions the issuer used at year end to those used in prior periods. (AS 2501.16)

The issuer engaged valuation specialists to determine the fair value of the collateral for impaired loans. The following deficiency was identified: · The firm did not perform any procedures to evaluate whether the issuer had a reasonable basis for the significant assumptions it developed related to the adjustments the issuer made to the valuation of collateral. (AS 2501.16)

The issuer determined the qualitative component of the ALL by applying basis points to qualitative factors. The following deficiency was identified: · The firm's approach for substantively testing the qualitative component of the ALL was to test the issuer's process. The firm did not evaluate whether the issuer had a reasonable basis for the significant assumptions related to basis points applied to the qualitative factors. (AS 2501.16)

The issuer engaged valuation specialists to determine the fair value of the collateral for impaired loans. The following deficiency was identified: · The firm did not perform any procedures to evaluate the reasonableness of the significant assumptions developed and used by the company's specialists. (AS 1105.A8b)

The issuer's general reserve component of the ALL included a qualitative reserve component. In determining the qualitative reserve component the issuer used loan risk grades and basis point adjustments for qualitative factors. The following deficiencies were identified: - The firm's approach for substantively testing the ALL was to review and test management's process. With respect to certain qualitative components of the ALL the firm did not evaluate whether the issuer had a reasonable basis for the basis points used and for its selection of basis points from a range of potential basis points. (AS 2501.16)

The issuer used certain qualitative factors to determine the qualitative reserve component of the ACLL. The firm selected for testing a control over the issuer's review of the qualitative reserve component. The firm's approach for substantively testing the qualitative component of the ACLL was to test the issuer's process. The firm did not perform any procedures to evaluate the reasonableness of significant assumptions used by the issuer to develop the qualitative component of the ACLL. (AS 2501.16)

The firm's approach for substantively testing the ACLL was to test the issuer's process. The firm did not perform any procedures to evaluate the reasonableness of significant assumptions used by the issuer to develop the ACLL. (AS 2501.16)