Explorer

The firm selected for testing a control that consisted of a quarterly review of the provision for income taxes. The firm did not identify and test any controls over the accuracy and completeness of the information used by the control owner in the performance of this control. (AS 2201.39)

The firm selected for testing a control that consisted of the issuer's review of an analysis of the valuation of deferred tax assets. The issuer adjusted its valuation of certain deferred tax assets based on a study prepared by the issuer's external specialist. The firm did not perform any procedures to test the aspect of this control or any other control that addressed the accuracy and completeness of the data and reasonableness of the assumptions used in this study. (AS 2201.42 and .44)

The firm's approach for substantively testing the estimated future benefit of certain deferred tax assets was to review and test management's process. The issuer used forecasts to determine this estimate. The firm did not sufficiently evaluate the reasonableness of this estimate because the firm's procedures to test certain assumptions underlying these forecasts were limited to inquiring of management and performing a sensitivity analysis that indicated that if certain alternative assumptions were used the future benefit would change by a significant amount. Further the firm did not perform any procedures to test the accuracy and completeness of certain data the issuer used in these forecasts. (AS 1105.10; AS 2501.09 .10 and .11)

The firm did not perform any procedures to test or test any controls over the accuracy and completeness of certain information produced by the issuer that the firm used in its substantive testing of the income tax provision. (AS 1105.10)

The firm did not perform any procedures to test or test any controls over the accuracy and completeness of certain information produced by the issuer that the firm used in its substantive testing of the income tax provision and a deferred tax asset. (AS 1105.10)

The firm did not perform procedures to test certain permanent and temporary differences used in calculating the income tax provision beyond vouching these amounts to issuer-prepared schedules. (AS 2301.08 and.11)

The firm selected for testing a control that included a review of the issuer's deferred tax assets and liabilities roll-forward schedule. The control owners used certain supporting schedules in the performance of this control but the firm did not identify and test any controls over the accuracy and completeness of the supporting schedules. (AS 2201.39)

In addition the firm did not identify and test any controls over the accuracy and completeness of the information used in the performance of these controls. (AS 2201.39)

The issuer reported an income tax benefit from tax exemptions that a foreign tax authority granted the issuer. These exemptions were subject to compliance with certain conditions. The following deficiencies were identified: · The firm selected for testing a control that consisted of the review of an analysis that the issuer used to determine whether it met those conditions. The firm did not identify and test any controls over the accuracy and completeness of certain information in the issuer's analysis that the control owner used in the operation of this control. (AS 2201.39)

The issuer recorded a partial valuation allowance against its recorded deferred tax assets based on forecasted taxable income which included various significant assumptions. The following deficiencies were identified: · The firm did not perform procedures to test or test controls over the accuracy and completeness of certain information produced by the issuer that the firm used in its substantive testing of the deferred tax assets that were subject to the valuation allowance. (AS 1105.10)