Explorer

With respect to the issuer's transfer pricing related to intercompany transactions the following deficiencies were identified: · The firm selected for testing a control over the issuer's monitoring of compliance with its transfer pricing methodology including the review of whether all transactions introducing transfer-pricing risk had been identified for evaluation. The firm did not evaluate the specific review procedures that the control owner performed to (1) determine whether the issuer identified a complete population of transactions with potential transfer-pricing implications for review and (2) assess the issuer's compliance with its transfer-pricing methodology for the transactions that were identified including the control owner's review of intercompany margins. (AS 2201.42 and .44)

With respect to the issuer's transfer pricing related to intercompany transactions the following deficiencies were identified: · The firm did not perform any substantive procedures to assess the issuer's compliance with its transfer-pricing methodology for intercompany transactions. (AS 2301.08)

With respect to the issuer's uncertain tax positions the firm did not identify and test any controls over the issuer's evaluation of (1) the unit of account that it used to determine individual tax positions and (2) the assumptions used to evaluate whether its uncertain tax positions met the recognition threshold. (AS 2201.39)

With respect to the issuer's disclosures related to its permanent reinvestment of foreign earnings the following deficiencies were identified: · The firm selected for testing a control that included the issuer's review of its disclosures related to these earnings. The firm did not evaluate the specific review procedures that the control owner performed to evaluate the potential effects of the changes in federal tax laws on the issuer's disclosures. (AS 2201.42 and .44)

With respect to the issuer's disclosures related to its permanent reinvestment of foreign earnings the following deficiencies were identified: · The firm did not perform any substantive procedures to evaluate the potential effects of the changes in federal tax laws on the issuer's disclosures related to its permanent reinvestment of foreign earnings. (AS 2301.08)

During the year certain changes in federal tax laws affected the issuer's determination of its state and local taxes. The firm did not identify and test any controls over the issuer's evaluation of the effects of these changes on its state and local taxes. (AS 2201.39)

The firm did not perform any substantive procedures to evaluate the effects of the changes in federal tax laws on the issuer's state and local taxes. (AS 2301.08)

The firm did not identify and test any controls that addressed whether the issuer's calculations of certain limitations on deductions used to determine income tax expense were appropriate. Further the firm did not identify and test any controls over the issuer's evaluation of the base erosion and anti-abuse tax ('BEAT'). (AS 2201.39)

The firm did not perform any substantive procedures to (1) test the adjusted taxable income amount that the issuer used to determine its business interest deduction and (2) evaluate the issuer's assertion that it did not meet the requirements to calculate and record a BEAT. (AS 2301.08)

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 firm did not identify and test any controls that addressed whether the issuer met those conditions. (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: · For the first year of the forecast period the firm did not sufficiently evaluate the reasonableness of a significant assumption because its procedures were limited to comparing the assumption to the issuer's recent experience. (AS 2501.16)

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: · For the remaining years of the forecast period the firm did not perform any procedures to evaluate the reasonableness of the significant assumptions. (AS 2501.16)

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)

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 identify and evaluate a misstatement in a required disclosure under FASB ASC Topic 740 Income Taxes. (AS 2810.30 and .31)

The firm did not perform any procedures to evaluate the issuer's identification and recognition of uncertain tax positions taken. (AS 2301.08) Unrelated to our review the issuer reevaluated its accounting for income taxes including uncertain tax positions and concluded that material misstatements existed that had not been previously identified. The issuer subsequently filed a Form 8-K and disclosed that the financial statements should no longer be relied upon.