Explorer

During the year the issuer acquired a business and engaged a valuation specialist to determine the fair value of the acquired intangible assets. The firm's approach for substantively testing the fair value of acquired intangible assets was to test the issuer's process and the firm used an auditor-engaged specialist to evaluate the significant assumptions the company's specialist used. The firm did not sufficiently evaluate the reasonableness of the significant assumptions because it did not identify that the auditor-engaged specialist did not (1) perform procedures beyond inquiry of the company's specialist to evaluate the reasonableness of the significant assumptions that were developed by the issuer and the company's specialist and (2) evaluate the relevance and reliability of the external data that the company's specialist used to develop certain assumptions. (AS 1105.A8a and .A8b; AS 1210.09 and .12; AS 2501.16)

The firm's internal inspection program inspected this audit and reviewed these areas but did not identify the deficiencies below. During the year the issuer acquired certain businesses and engaged a specialist to assist in determining the fair value of consideration for the acquisitions and certain acquired assets. The firm used an auditor-engaged specialist to assist it with testing the fair value of the consideration for the acquisitions. The following deficiencies were identified: · The firm did not perform sufficient procedures to evaluate the reasonableness of certain significant assumptions because it limited its procedures to evaluating the consistency of the assumptions with industry information. Further the firm did not evaluate significant differences between the assumptions and the industry information. (AS 1105.A8b)

During the year the issuer acquired certain businesses and engaged an external specialist to estimate the fair value of certain acquired intangible assets. The firm did not evaluate the reasonableness of assumptions used by the external specialist to estimate the fair value. (AS 2502.26 and .28)

For certain other business combinations the firm did not evaluate the reasonableness of the estimated useful lives of the acquired intangible assets. (AS 2501.07)

During the year the issuer acquired a business and engaged a specialist to estimate the fair value of the acquired intangible assets and goodwill at the acquisition date. The firm's approach for substantively testing the fair value of these assets was to test the issuer's process. The firm did not perform sufficient substantive procedures to evaluate the reasonableness of certain significant assumptions developed by the issuer because the firm limited its procedures to obtaining issuer-prepared documents. (AS 2501.16)

During the year the issuer acquired a business and engaged a specialist to estimate the fair value of the acquired intangible assets and goodwill at the acquisition date. The firm's approach for substantively testing the fair value of these assets was to test the issuer's process. The firm did not perform any substantive procedures to evaluate the reasonableness of other significant assumptions developed by the issuer. (AS 2501.16)

During the prior year the issuer acquired a controlling interest in a business and during the current year engaged a specialist to estimate the final fair value of the non-controlling interest. The firm did not evaluate the reasonableness of certain significant assumptions the company's specialist developed and used. (AS 1105.A8b)

During the year the issuer acquired certain businesses. The following deficiencies were identified: · The firm did not perform procedures to test the fair value of the intangible assets beyond obtaining and reading the purchase price allocation for one of the acquisitions. (AS 2501.07)

During the year the issuer acquired certain businesses. The following deficiencies were identified: · The firm did not perform any procedures to test the existence completeness and fair value of the tangible assets acquired at the acquisition dates for these acquisitions. (AS 2301.08; AS 2501.07)

During the year the issuer acquired certain businesses. The following deficiencies were identified: · The firm did not perform any procedures to test the purchase consideration for these acquisitions including contingent consideration. (AS 2301.08; AS 2501.07)

During the year the issuer acquired a business. The following deficiencies were identified: · The firm did not perform procedures beyond obtaining and reading the issuer's purchase price allocation schedule to test the fair value of the acquired intangible assets. (AS 2501.07)

During the year the issuer acquired a business and determined the fair value of an acquired intangible asset using forecasted cash flows which included significant assumptions related to revenue growth rates for the forecast period. The following deficiencies were identified: · For certain years within the forecast period the firm did not sufficiently evaluate the reasonableness of these significant assumptions because it did not (1) evaluate significant differences between the issuer's forecasted rates and industry growth information it used to support these rates (2) evaluate whether these forecasted rates were consistent with the issuer's historical and recent experience and (3) take into account the issuer's ability to achieve these forecasted rates. (AS 2501.16 and .17)

During the year the issuer acquired a business and determined the fair value of an acquired intangible asset using forecasted cash flows which included significant assumptions related to revenue growth rates for the forecast period. The following deficiencies were identified: · For the remaining years within the forecast period the firm did not perform any procedures to evaluate the reasonableness of the forecasted revenue growth rates. (AS 2501.16)

During the year the issuer acquired a business and engaged a specialist to determine the fair values of the acquired intangible assets and the provision for contingent consideration to be paid to the seller. The firm's approach for substantively testing the fair values of the acquired intangible assets was to develop independent expectations of the estimates. The following deficiencies were identified: · The firm did not perform any procedures to evaluate the reasonableness of certain significant assumptions developed by the issuer which were also used by the firm in developing its independent expectations. (AS 2501.16)

During the year the issuer acquired a business and engaged a specialist to determine the fair values of the acquired intangible assets and the provision for contingent consideration to be paid to the seller. The firm's approach for substantively testing the fair values of the acquired intangible assets was to develop independent expectations of the estimates. The following deficiencies were identified: · For two of the acquired intangible assets the firm did not perform sufficient procedures to demonstrate it had a reasonable basis for an assumption it independently derived because the data it used to develop this assumption included unrelated data. (AS 2501.22)

During the year the issuer acquired a business and engaged a specialist to determine the fair values of the acquired intangible assets and the provision for contingent consideration to be paid to the seller. The firm's approach for substantively testing the fair values of the acquired intangible assets was to develop independent expectations of the estimates. The following deficiencies were identified: · For one of the acquired intangible assets the firm used an auditor-employed specialist to evaluate a significant assumption developed by the company's specialist which the firm used in developing its independent expectation of this estimate. The firm did not identify that the work of the auditor-employed specialist did not provide sufficient appropriate audit evidence because it did not evaluate the (1) relevance and reliability of external data that the company's specialist used to develop this assumption and (2) reasonableness of this assumption. (AS 1105.A8a and .A8b; AS 1201.C6 and .C7)

The firm's approach for substantively testing the fair value of the contingent consideration to be paid to the sellers was to review and test the issuer's process. The firm's approach for evaluating the reasonableness of certain of the issuer's assumptions was to develop independent expectations of those assumptions. The firm did not compare the issuer's assumptions to these independent expectations which were affected by the audit deficiencies discussed above. (AS 2501.16)

During the year the issuer acquired a business and engaged a specialist to assist in determining the fair values of certain acquired assets and the related liabilities as of the acquisition date using various significant assumptions. This specialist also assisted the issuer in determining the fair values at year end. The following deficiencies were identified: · In evaluating the company's specialist's methods to determine these fair values as of the acquisition date the firm selected a sample of assets to evaluate whether the data and significant assumptions were appropriately applied. For one category of these assets the firm did not evaluate whether the data and significant assumptions were appropriately applied to the complete population of these assets. (AS 1105.A8c)

During the year the issuer acquired a business and engaged a specialist to assist in determining the fair values of certain acquired assets and the related liabilities as of the acquisition date using various significant assumptions. This specialist also assisted the issuer in determining the fair values at year end. The following deficiencies were identified: · For these acquired assets and the related liabilities as of the acquisition date the firm did not perform procedures to evaluate the reasonableness of certain significant assumptions developed by the company's specialist beyond comparing these assumptions to assumptions the issuer used in the prior year. (AS 1105.A8b)

The firm used an auditor-engaged specialist to assist it with testing the fair values of certain assets and the related liabilities at year end which were determined by one of the company's specialists. The following deficiencies were identified: · The firm did not identify that the auditor-engaged specialist did not perform any procedures to evaluate the (1) reasonableness of significant assumptions developed by the company's specialist or by the issuer and (2) relevance and reliability of certain external data used by the company's specialist. (AS 1105.A8a and .A8b; AS 1210.09 and .12; AS 2501.16)

During the year the issuer acquired two businesses. The firm did not perform any procedures to evaluate the reasonableness of certain significant issuer-developed assumptions that were used by another of the company's specialists to determine the fair values of acquired intangible assets as of the acquisition date and at year end. (AS 2501.16)

During the year the issuer acquired a business and determined the fair value of an acquired intangible asset using forecasted cash flows which included significant assumptions related to sales growth product mix and pricing for the forecast period. The following deficiencies were identified: · The firm did not evaluate whether the issuer had a reasonable basis for (1) the product mix assumption and (2) another pricing assumption. (AS 2501.16)

During the year the issuer acquired multiple businesses. The following deficiencies were identified: · From one of these business combinations the firm did not sufficiently evaluate whether an assumption was consistent with historical and recent experience because it did not evaluate the significant differences between the assumption and this experience. Further when evaluating the issuer's ability to carry out its planned course of action the firm performed a sensitivity analysis for this assumption but did not evaluate the significant differences between the alternative assumptions it used in this analysis and the issuer's historical and recent experience. (AS 2501.16 and .17)

During the year the issuer acquired several businesses. For one of these business combinations the issuer engaged a specialist to assist it in determining the fair values of certain acquired intangible assets using various significant assumptions developed by the issuer or the company's specialist. The following deficiencies were identified: · The firm used an auditor-employed specialist to evaluate the reasonableness of a significant assumption developed by the company's specialist that was used in the measurement of an acquired intangible asset. The firm did not identify that the work of the auditor-employed specialist did not provide sufficient appropriate audit evidence because the auditor-employed specialist did not evaluate (1) whether this assumption was consistent with recent existing market information and (2) whether certain data the company's specialist used to develop this assumption were relevant to the assumption beyond observing that the data were from comparable industries. (AS 1105.A8a and .A8b; AS 1201.C6 and .C7)

During the year the issuer acquired several businesses. For one of these business combinations the issuer engaged a specialist to assist it in determining the fair values of certain acquired intangible assets using various significant assumptions developed by the issuer or the company's specialist. The following deficiencies were identified: · The firm used an auditor-employed specialist to evaluate the reasonableness of a significant assumption developed by the company's specialist that was used in the measurement of an acquired intangible asset. The firm did not identify that the work of the auditor-employed specialist did not provide sufficient appropriate audit evidence because the auditor-employed specialist did not evaluate (1) whether this assumption was consistent with recent existing market information and (2) whether certain data the company's specialist used to develop this assumption were relevant to the assumption beyond observing that the data were from comparable industries. (AS 1105.A8a and .A8b; AS 1201.C6 and .C7)

During the year the issuer acquired a business and determined the fair value of an acquired intangible asset using forecasted cash flows which included significant assumptions related to sales growth product mix and pricing for the forecast period. The following deficiencies were identified: · The firm did not perform any procedures to evaluate the reasonableness of the forecasted sales growth. (AS 2501.16)

During the year the issuer acquired a business and determined the fair value of an acquired intangible asset using forecasted cash flows which included significant assumptions related to sales growth product mix and pricing for the forecast period. The following deficiencies were identified: · The firm did not sufficiently evaluate the reasonableness of certain pricing assumptions because it limited its procedures to inquiry of management and review of internal plans without taking into account the issuer's ability to carry out its planned course of action. (AS 2501.16 and .17)

During the year the issuer acquired a business and engaged a specialist to determine the fair values of certain acquired assets. The following deficiencies were identified: · For one of these assets the firm did not sufficiently evaluate the reasonableness of a significant assumption developed by the issuer because it did not perform any procedures to evaluate the reasonableness of a component of this significant assumption. (AS 2501.16)

During the year the issuer acquired a business and determined the fair value of certain acquired intangible assets using various significant assumptions. The firm's approach for substantively testing the fair values of these assets was to test the issuer's process. The firm did not perform any procedures to evaluate the reasonableness of certain significant assumptions used in the valuation of these assets. (AS 2501.16)

During the year the issuer acquired a business including an intangible asset. The issuer developed assumptions to determine the fair value of the acquired intangible asset. The firm did not perform procedures beyond inquiry of management to evaluate the reasonableness of a significant assumption. (AS 2501.16)

The issuer determined the fair values of certain acquired assets using cash-flow forecasts. The following deficiency was identified: · The firm did not evaluate the reasonableness of the useful lives assigned to certain of the acquired assets including evaluating significant differences between the useful lives assigned to these assets and the cash flow forecast periods used to determine their fair values. (AS 2501.16)

The issuer determined the fair values of certain other assets of the acquired business based on two previously completed acquisitions. The firm did not sufficiently evaluate whether the issuer had a reasonable basis for the significant assumptions the issuer used because the firm did not evaluate whether these previous acquisitions were comparable to this acquired business. (AS 2501.16)

During the year the issuer acquired multiple businesses and engaged specialists to assist it in determining the fair values of certain acquired assets using various significant assumptions. The following deficiency was identified: · For certain acquired intangible assets the firm did not perform any procedures to evaluate the reasonableness of certain significant assumptions developed by the issuer including evaluating significant differences between the useful lives assigned to these intangible assets and the cash flow forecast periods used to determine their fair values. (AS 2501.16)

During the year the issuer entered into a transaction and engaged a specialist to assist it in determining the fair value of a certain liability recorded in connection with the transaction. The following deficiencies were identified: · The firm's approach for substantively testing the fair value of this liability was to test the issuer's process and the firm used an auditor-engaged specialist to assist it with evaluating the significant assumptions the company's specialist used. The firm did not identify that the auditor-engaged specialist did not (1) perform any procedures to evaluate the reasonableness of a significant assumption and (2) evaluate whether certain external data that the company's specialist used to develop this significant assumption were relevant or reliable. (AS 1105.A8a and .A8b; AS 1210.09 and .12)

The issuer determined the fair values of certain acquired assets using cash-flow forecasts. The following deficiency was identified: · The firm did not sufficiently evaluate the reasonableness of certain significant assumptions the issuer used because the firm did not evaluate (1) the relevance and reliability of certain market information it used and (2) whether these assumptions were consistent with certain industry factors and existing market information. (AS 1105.04 and .06; AS 2501.16)

During the year the issuer acquired a business. The firm did not perform procedures to evaluate the reasonableness of a significant assumption used to estimate the amount of acquired intangible assets beyond inquiry with management. (AS 2501.16)

The firm's approach for testing the fair value of acquired intangible assets was to review and test management's process. The firm did not evaluate the reasonableness of the assumptions developed by the issuer or the external specialist. (AS 2502.26 and .28)

During the year the issuer acquired a business and used an external specialist to determine the fair values of the acquired intangible assets and property plant and equipment ('PP&E'). The firm's approach for testing the fair value of these acquired assets was to review and test management's process. The firm did not perform any procedures beyond inquiring of management to evaluate the reasonableness of the assumptions developed by the external specialist. (AS 2502.26 and .28)

The firm did not perform procedures beyond inquiry to evaluate significant differences it identified when performing certain comparisons to test the reasonableness of certain assumptions underlying the cash-flow forecasts that the issuer used to determine the fair value of the investments discussed above. (AS 2502.26 .28 .31 and .36)

In its substantive testing the firm did not evaluate the reasonableness of the significant assumptions underlying the fair values of the obligations assumed. (AS 2502.26 and .28)

The firm's approach for substantively testing the valuation of certain acquired intangible assets was to review and test management's process. The firm did not perform procedures beyond inquiring of management to evaluate the reasonableness of a revenue assumption underlying the cash-flow forecasts for any of the periods beyond the first two years of the 20-year forecast period. (AS 2502.26 .28 .31 and .36)

The firm's approach for substantively testing the valuation of the acquired intangible assets was to review and test management's process. The firm performed certain comparisons to test the reasonableness of certain assumptions underlying the cash-flow forecasts that the issuer used to determine the fair value of the acquired intangible assets. The firm did not perform procedures beyond inquiring of management to evaluate the differences it identified in these comparisons. (AS 2502.26 .28 .31 and .36)

The firm's approach for substantively testing the valuation of the acquired intangible assets was to review and test management's process. The firm did not perform procedures beyond inquiring of management to evaluate the reasonableness of certain other assumptions underlying these cash-flow forecasts. (AS 2502.26 .28 .31 and .36)

During the year the issuer acquired a business. The issuer accounted for an acquired investment using the equity method and determined the fair value of certain acquired intangible assets using cash-flow forecasts. The following deficiency was identified: · The firm's approach for substantively testing the valuation of these acquired intangible assets was to test the issuer's process. The firm did not perform any procedures to evaluate the reasonableness of certain significant assumptions used in these cash-flow forecasts. (AS 2501.16)

During the year the issuer acquired a business and determined the fair value of certain acquired intangible assets using cash-flow forecasts. The following deficiency was identified: · The firm's approach for substantively testing the valuation of these acquired intangible assets was to test the issuer's process. The firm did not sufficiently evaluate the reasonableness of certain significant assumptions used in these cash-flow forecasts because its procedures were limited to inquiring of management and for one of these assumptions comparing the current-year forecasted results to actual results. (AS 2501.16)

During the year the issuer acquired a business. The following deficiency was identified: · The firm's approach for substantively testing the fair values of these acquired intangible assets was to test the issuer's process. The firm did not sufficiently evaluate the reasonableness of certain of the significant assumptions the issuer used because the firm did not evaluate whether these assumptions were consistent with certain industry factors and the issuer's historical experience. (AS 2501.16)

During the year the issuer acquired multiple businesses and determined the fair value of certain acquired intangible assets using cash-flow forecasts. The firm's approach for substantively testing the valuation of these acquired intangible assets was to test the issuer's process. The following deficiency was identified: · For one of these acquired intangible assets the firm did not evaluate the reasonableness of a significant assumption that the issuer used in these cash-flow forecasts. (AS 2501.16)

During the year the issuer acquired multiple businesses and engaged specialists to determine the fair value of certain acquired intangible assets using various assumptions. The following deficiencies were identified: · The firm selected for testing three controls that consisted of the issuer's reviews of the fair value of these acquired intangible assets. For two of these controls the firm did not evaluate the criteria the control owners used to identify items for follow-up when assessing the reasonableness of certain assumptions used. (AS 2201.42 and .44)

During the year the issuer acquired multiple businesses and engaged specialists to determine the fair value of certain acquired intangible assets using various assumptions. The following deficiencies were identified: · The firm did not evaluate whether the issuer was required to make certain disclosures related to these business combinations in conformity with FASB ASC Topic 805 Business Combinations beyond asserting that these disclosures were either not material to the financial statements or not applicable. (AS 2301.08)

During the year the issuer acquired a business and determined the fair value of certain acquired intangible assets using cash-flow forecasts. The issuer recorded subsequent adjustments to the provisional fair value of these acquired intangible assets during the measurement period. The following deficiencies were identified: · The firm's approach for substantively testing the valuation of these acquired intangible assets was to test the issuer's process. The firm did not perform any procedures to evaluate the reasonableness of certain significant assumptions used in these cash-flow forecasts. (AS 2501.16)