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The firm also identified an error related to the debt discount balance affecting the prior year that the issuer corrected in the current year. The firm did not evaluate whether this correction was in conformity with FASB ASC Topic 250 Accounting Changes and Error Corrections. (AS 2810.30)

The issuer amended its convertible debt agreements. The following audit deficiencies were identified: · The firm did not evaluate the amendments to the convertible debt agreements to determine whether the issuer's accounting was in conformity with FASB ASC Subtopic 470-60 Troubled Debt Restructurings by Debtors. (AS 2810.30)

The firm selected for testing certain controls over the issuer's review and approval of adjustments to debt. The firm did not evaluate the review procedures that the control owners performed including procedures to identify items for follow up and the procedures to determine whether those items were appropriately resolved. (AS 2201.42 and .44) Unrelated to our review the issuer reevaluated its accounting for certain debt and concluded that a material misstatement existed that had not been previously identified. The issuer subsequently corrected this misstatement in a restatement of its financial statements and the firm issued an audit report on the issuer's restated financial statements. Our procedures did not include review of any additional audit work related to the restatement. The issuer also reevaluated its controls over debt and concluded that a material weakness existed that had not been previously identified. The issuer subsequently reflected this material weakness in a revision to its report on ICFR and the firm revised its opinion on the effectiveness of the issuer's ICFR to express an adverse opinion. Our procedures did not include review of any additional audit work related to this material weakness.

The firm selected for testing certain controls over the issuer's review and approval of adjustments to debt. The firm did not identify and evaluate a departure from IFRS related to the issuer's accounting for and presentation of certain debt in conformity with IAS 32 Financial Instruments: Presentation. (AS 2810.30 and .31) Unrelated to our review the issuer reevaluated its accounting for certain debt and concluded that a material misstatement existed that had not been previously identified. The issuer subsequently corrected this misstatement in a restatement of its financial statements and the firm issued an audit report on the issuer's restated financial statements. Our procedures did not include review of any additional audit work related to the restatement. The issuer also reevaluated its controls over debt and concluded that a material weakness existed that had not been previously identified. The issuer subsequently reflected this material weakness in a revision to its report on ICFR and the firm revised its opinion on the effectiveness of the issuer's ICFR to express an adverse opinion. Our procedures did not include review of any additional audit work related to this material weakness.

The firm did not perform any substantive procedures to test the issuer's compliance with certain financial debt covenants. (AS 2301.08)

The firm did not identify and evaluate (1) a misstatement in the issuer's statement of cash flows related to proceeds and repayments of debt; (2) the issuer's omission of a required disclosure under FASB ASC Topic 210 Balance Sheet related to the remaining borrowing capacity for certain debt; and (3) misstatements in certain disclosures required under FASB ASC Topic 820 and FASB ASC Topic 825 Financial Instruments related to the issuer's accounting for and measurement of certain other debt. (AS 2810.30 and .31) In connection with our review the issuer reevaluated its presentation of the statement of cash flows and concluded that a misstatement existed that had not been previously identified. The issuer corrected this misstatement in a subsequent filing.

The issuer reported convertible debt that was measured at fair value. The firm did not perform procedures beyond inquiring of management to evaluate the reasonableness of a significant assumption used by the issuer to determine the fair value of the convertible debt. (AS 2501.16)

The firm did not perform substantive procedures to test the debt beyond recalculating the balance based on an agreement that specified that the balance was past due. (AS 2301.08)

The firm did not perform procedures to test the design and operating effectiveness of a control over the issuer-specific accounting considerations related to the adoption of new accounting pronouncements. (AS 2201.42 and .44)

The firm identified for testing four review controls over the issuance and repurchase of debt instruments. The firm did not evaluate the review procedures the control owners performed including the procedures to identify items for follow up and the procedures to determine whether those items were appropriately resolved. (AS 2201.42 and .44)

For certain debt repurchased during the year the firm did not perform any procedures to test the number of debt holders and aggregate principal amount of the repurchased debt and the fair value of consideration paid to the debt holders upon repurchase. (AS 2301.08; AS 2501.07)

The firm did not identify and evaluate a departure from GAAP related to a related party note payable that was not presented on the face of the balance sheet in accordance with FASB ASC Subtopic 235-10-S99 Notes to Financial Statements — Overall — SEC Materials. (AS 2410.17; AS 2810.30 and .31)

The firm selected for confirmation certain debt and received electronic responses to its confirmation requests. The firm did not consider performing procedures to address the risk associated with electronic responses. (AS 2310.29)

During the year the issuer issued convertible notes with warrants. The issuer engaged an external specialist to determine the standalone fair values of the convertible notes and warrants to determine the allocation of proceeds and recording of debt and equity associated with the transaction. The following deficiency was identified: · The firm did not evaluate whether the issuer's accounting for the convertible notes was in conformity with GAAP including whether (1) the conversion options should have been bifurcated and accounted for as derivatives in conformity with FASB ASC Topic 815 Derivatives and Hedging or (2) the convertible notes should have been separated into a liability component and the embedded conversion option in conformity with FASB ASC Topic 470 Debt. (AS 2301.08)

During the year the issuer issued convertible notes with warrants. The issuer engaged an external specialist to determine the standalone fair values of the convertible notes and warrants to determine the allocation of proceeds and recording of debt and equity associated with the transaction. The following deficiency was identified: · The firm did not perform any substantive procedures to evaluate the reasonableness of the significant assumptions developed by the company's specialist to determine the fair values of the convertible notes and warrants. (AS 1105.A8b)

During the year the issuer issued convertible notes with warrants. The issuer engaged an external specialist to determine the standalone fair values of the convertible notes and warrants to determine the allocation of proceeds and recording of debt and equity associated with the transaction. The following deficiency was identified: · The firm did not perform any substantive procedures to evaluate whether the method used by the company's specialist to determine the fair values of the convertible notes and warrants was appropriate in the circumstances taking into account the requirements of the applicable financial reporting framework. (AS 1105.A8c)

Subsequent to the issuance of the convertible notes with warrants the issuer also issued shares of common stock to the noteholder. The following deficiency was identified: · The firm did not perform substantive procedures beyond obtaining a copy of the securities purchase agreement to test the issuance of the shares to the noteholder. (AS 2301.08)

Subsequent to the issuance of the convertible notes with warrants the issuer also issued shares of common stock to the noteholder. The following deficiency was identified: · The firm did not evaluate an apparent discrepancy between the statement of stockholders' equity and the issuer's footnote disclosures regarding the issuance of these shares. (AS 2301.08)

During the year the issuer entered into certain transactions related to convertible debt and warrants. The following deficiencies were identified: · The firm did not perform sufficient procedures to evaluate whether the issuer's accounting for and presentation of convertible debt including warrants were in conformity with relevant GAAP because for certain transactions its procedures were limited to reading an issuer-prepared memorandum without evaluating certain terms within the debt and warrant agreements. (AS 2301.08 and .11) In connection with our review the issuer reevaluated its accounting for these convertible debt and warrant transactions and concluded that misstatements existed that had not been previously identified. The issuer subsequently restated its financial statements to correct these misstatements and the firm revised and reissued its report on the financial statements.

During the year the issuer entered into certain transactions related to convertible debt and warrants. The following deficiencies were identified: · The firm did not identify and evaluate that the method the issuer used to allocate fair value between certain warrants and convertible debt was not in conformity with FASB ASC Topic 470 Debt. (AS 2810.30 and .31) In connection with our review the issuer reevaluated its accounting for these convertible debt and warrant transactions and concluded that misstatements existed that had not been previously identified. The issuer subsequently restated its financial statements to correct these misstatements and the firm revised and reissued its report on the financial statements.

The firm did not perform any procedures to test debt and a related transaction beyond obtaining agreements and performing recalculations of certain amounts. (AS 2301.08)