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The firm's substantive procedures to test these inventory adjustments consisted of selecting a sample of items for testing. The firm used issuer-produced quantity information in these substantive procedures but did not perform any procedures to test or sufficiently test controls over the accuracy and completeness of this information. (AS 1105.10)

The issuer recorded transactions related to revenue and inventory at numerous business units. To address the risks of material misstatement related to revenue and inventory for certain of these business units the firm selected entity-level controls for testing including two controls that consisted of the issuer's reviews of financial information. The following deficiencies were identified: · For the second control the firm did not identify and test any controls over the accuracy and completeness of certain reports that the control owners used in the operation of the control. (AS 2201.39)

The firm did not test or in the alternative test any controls over the accuracy and completeness of the system-generated report that the issuer used to classify non-current inventory which was separately presented in the financial statements. (AS 1105.10)

The issuer performed cycle counts of inventory at other locations. The firm identified deficiencies in the design and operating effectiveness of these controls at year end. The following deficiency was identified: · The firm identified and tested various review controls that it believed would mitigate the deficiencies. The firm did not identify and test any controls over the accuracy and completeness of the information used in these reviews. (AS 2201.68) Unrelated to our review the issuer reevaluated its controls over inventory and concluded that material weaknesses existed that had not been previously identified. The issuer subsequently reflected these material weaknesses 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 and reissued its report.

The firm selected for testing a control over the review of inventory reserves. The firm did not identify and test any controls over the accuracy and completeness of information used in the operation of this control (AS 2201.39) Unrelated to our review the issuer reevaluated its controls over inventory and concluded that material weaknesses existed that had not been previously identified. The issuer subsequently reflected these material weaknesses 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 and reissued its report.

The firm used issuer inventory costing data in its substantive procedures to test the valuation of inventory. The firm did not perform any substantive procedures to test or in the alternative test any controls over the accuracy and completeness of this data. (AS 1105.10)

The firm's approach for substantively testing the issuer's reserve for certain inventory was to develop an independent expectation based on an inventory aging. The firm did not perform any substantive procedures to test or in the alternative test any controls over the accuracy and completeness of the inventory aging. (AS 1105.10; AS 2501.09 .10 and .12)

The issuer used two information technology (IT) systems to support the inventory process. Both IT systems were configured based on user roles and profiles which determined user access levels. The firm selected for testing controls over the program changes for these IT systems. The firm did not test or test any controls over the accuracy and completeness of the population of IT systems program changes from which it made its selections for testing. (AS 1105.10)

The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiency below. The issuer reported different types of inventory. The following deficiency was identified: • The firm did not identify and test any controls over the completeness and accuracy of reports that were used in the operation of certain of the controls it selected for testing over inventory. (AS 2201.39)

The subsidiary capitalized certain costs in the production of inventory. The firm selected for testing a control that consisted of management's review of a monthly cost analysis which compared actual to budgeted costs. The firm did not identify and test any controls over the accuracy and completeness of the monthly budgeted costs report used in the operation of this control. (AS 2201.39)

Certain of the issuer's inventory was subject to daily cycle counts and the issuer used a system-generated report that specified which items to count each day. The firm selected for testing a control that consisted of the issuer's daily cycle-count procedures. The firm did not test whether the system was properly configured to achieve the frequency schedule established by management and did not test the aspects of this control that addressed (1) the review and approval of the assignment of the frequency to each item and (2) whether approved frequencies were completely and accurately entered into the system. (AS 2201.42 and .44)

The firm selected for testing a control that consisted of the issuer's review of the reserve for excess and obsolete inventory. The firm did not identify and test any controls over the accuracy and completeness of the system-generated reports used in the operation of this control. (AS 2201.39)

The firm did not perform substantive procedures to test or in the alternative test any controls over the accuracy and completeness of the system-generated reports it used to test the issuer's reserve for excess and obsolete inventory. (AS 2501.11)

The firm's approach for substantively testing the reserve for excess and obsolete inventory was to review and test management's process. The firm did not perform any substantive procedures to test or in the alternative test any controls over the accuracy and completeness of the forecasted demand data that the issuer used to develop the reserve for excess and obsolete inventory. (AS 1105.10; AS 2501.11) [This citation refers to AS 2501 Auditing Accounting Estimates which was in effect for this audit. This standard was replaced by AS 2501 Auditing Accounting Estimates Including Fair Value Measurements which became effective for audits of financial statements for fiscal years ending on or after December 15 2020.]

Certain of the issuer's inventory was subject to cycle counts and the issuer's cycle-count policy required this inventory to be counted at specific frequencies during the year. The following deficiencies were identified: · The firm selected for testing a control that consisted of the issuer's monitoring of its cycle count results. The firm did not identify and test any controls over the accuracy and completeness of certain information that the control owners used in the operation of the control. (AS 2201.39)

The firm's internal inspection program had inspected this audit reviewed these areas and also identified the deficiencies below. The issuer held inventory at numerous business units. The firm subjected certain of the issuer's business units that were included within three of the issuer's segments to more extensive audit procedures. The following deficiencies were identified: · For a third of these business units the firm selected for testing controls over the existence of inventory that included the control owners' use of various system-generated reports in the operation of the controls. The firm did not identify and test any controls that addressed the risk that unauthorized or inappropriate changes could be made to these reports. (AS 2201.39)

The firm's approach for substantively testing the inventory reserve was to review and test management's process. The firm did not test or sufficiently test controls over the accuracy and completeness of certain information the firm used in its substantive testing of the inventory reserve. (AS 1105.10; AS 2501.11)

The firm selected for testing an automated control and certain information technology (“IT”) dependent manual controls over inventory that used data or reports that were derived from the issuer's inventory system for which the firm had identified a significant deficiency that was not remediated until the fourth quarter. The firm did not test any instances of the automated control and the controls over the accuracy and completeness of these data and reports subsequent to the remediation of the significant deficiency. (AS 2201.55 and .56)

The firm did not identify and test any controls over the accuracy and completeness of the actual costs for raw materials direct labor and overhead that were used by the issuer's inventory system to calculate manufacturing variances between actual and standard costs for the inventory at one of the issuer's locations. (AS 2201.39)

The issuer performed cycle counts of inventory at certain of the issuer's locations. The firm selected for testing controls that consisted of the issuer's cycle-count procedures and reviews of reports to monitor the frequency and accuracy of the counts. The firm did not identify and test any controls over the accuracy and/or completeness of the system-generated reports the issuer used in the operation of its cycle-count monitoring controls. (AS 2201.39)

The issuer performed cycle counts of inventory at certain of the issuer's locations. The firm selected for testing controls that consisted of the issuer's cycle-count procedures and reviews of reports to monitor the accuracy of the counts. The firm did not evaluate the procedures the control owner performed to assess the accuracy and completeness of certain data used in the operation of the issuer's cycle-count monitoring controls. (AS 2201.42 and 44)

The firm selected for testing a control that consisted of the issuer's review of the reserve for excess and obsolete inventory. The firm did not identify and test any controls over the accuracy of the system-generated report the issuer used in the operation of this control. (AS 2201.39)

The firm did not perform substantive procedures to test or in the alternative identify and test any controls over the accuracy of the system-generated report that the firm used in its substantive testing of the reserve for excess and obsolete inventory. (AS 1105.10)

The firm's approach to substantively testing the issuer's reserve for excess and obsolete inventory was to review and test management's process. The firm did not perform any substantive procedures to test or test controls over the accuracy and completeness of certain data used by the issuer to estimate the inventory reserves. (AS 1105.10; AS 2501.11)

The firm selected for testing controls that consisted of the issuer's review of inventory. The firm did not identify and test any controls over the accuracy and completeness of the reports that the control owners used in the operation of these controls. (AS 2201.39)

Certain of the issuer's inventory was subject to weekly cycle counts and the issuer used system-generated reports to determine the frequency with which each item should be counted and to select the items that should be counted each week. The firm did not perform any substantive procedures to test or in the alternative test any controls over the accuracy and completeness of these reports. As a result the firm did not obtain sufficient appropriate audit evidence that the cycle-count procedures the issuer used for this inventory were sufficiently reliable to produce results substantially the same as those that would have been obtained by a count of all items each year. (AS 1105.10; AS 2510.11)

The firm selected for testing a control that consisted of the issuer's review of the reserve for excess and obsolete inventory. The firm did not identify and test any controls over the accuracy and completeness of the system-generated report used in the operation of this control. (AS 2201.39)

The firm used reports produced by the issuer in its substantive procedures to test (1) the reserve for excess and obsolete inventory and (2) whether finished goods inventory was recorded at the lower of cost or net realizable value. The firm did not perform any procedures to test or test any controls over the accuracy and completeness of these reports. (AS 1105.10)

For certain locations the firm's substantive procedures to test the unit cost of inventory consisted of selecting a sample of items for testing. The following deficiencies were identified: · The firm did not perform any procedures to test or test controls over the accuracy and completeness of certain issuer-produced information used in its substantive testing. (AS 1105.10)

For certain inventory the firm's approach for substantively testing the reserve for excess and obsolete inventory was to test the issuer's process. The following deficiencies were identified: · The firm did not perform any procedures to test or test controls over the accuracy and completeness of an issuer-produced report the firm used in its substantive testing of the reserve for excess and obsolete inventory. (AS 1105.10)

The firm did not perform any procedures to test or test controls over the accuracy and completeness of certain information produced by the issuer that the firm used in its testing of the net realizable value of certain other inventory. (AS 1105.10)

The firm's substantive procedures to test the unit cost of inventory consisted of (1) selecting a sample of raw materials for testing and (2) testing the issuer's process for allocating labor and overhead costs to inventory. The following deficiencies were identified: · The firm did not perform procedures to test or test controls over the accuracy and completeness of certain issuer-produced information that it used in its testing of the allocated labor and overhead costs. (AS 1105.10)

The issuer reported a reserve for excess and obsolete inventory. The firm selected for testing a control consisting of the issuer's review of the reserve for the inventory. The firm did not identify and test any controls over the accuracy and completeness of inventory items included in the obsolescence reserve. (AS 2201.39)

The firm's approach for substantively testing the excess and obsolete inventory reserve for certain inventory was to test the issuer's process used to develop the reserve. The firm did not perform substantive procedures to test or identify and test any controls over the accuracy and completeness of inventory items included in in the obsolescence reserve. (AS 1105.10)

The firm selected for testing a control that consisted of the issuer's review and approval of the reserve for excess and obsolete inventory. The firm did not identify and test any controls over the accuracy and completeness of the reports that the issuer used in the operation of this control. (AS 2201.39)

The firm used data produced by the issuer in its substantive procedures to test the reserve for excess and obsolete inventory. The firm did not perform any procedures to test or test any controls over the accuracy and completeness of certain of these data. (AS 1105.10)

For one business unit the firm selected for testing a control that included the issuer's reviews of the accuracy and completeness of reports that were used in the operation of the issuer's controls over revenue and inventory. The firm did not test the aspects of this control that addressed the accuracy and/or completeness of certain of these reports. (AS 2201.42 and .44)

The firm used certain data in its substantive testing of the reserve for excess and obsolete inventory but did not perform any procedures to test or test any controls over the accuracy and completeness of these data. (AS 1105.10)

The firm selected for testing a control that included the issuer's review of journal entries related to inventory. The firm did not identify and test any controls over the accuracy and completeness of certain information used in the operation of this control. (AS 2201.39)

The firm's approach for testing labor and overhead costs that the issuer allocated to inventory was to review and test management's process for estimating the amounts to capitalize in inventory. The firm did not test the accuracy and completeness of the data the issuer used to allocate these costs. (AS 1105.10)

In addition the firm's approach for testing labor and overhead rates was to develop an independent estimate. The firm did not test the accuracy and completeness of the system-generated reports used to develop its independent estimate. (AS 1105.10)

The firm's substantive procedures to test the unit cost of certain inventory included selecting a sample of inventory items for testing. The following deficiencies were identified: · The firm did not perform any procedures to test or test any controls over the accuracy and completeness of certain data and reports used in its substantive testing of this inventory. (AS 1105.10)

The firm observed for a sample of locations physical inventory counts performed as of various interim dates. The firm did not perform sufficient procedures to extend its audit conclusions on the existence of inventory for the periods between its interim testing and year end because the firm limited its procedures to agreeing inventory movements between the interim dates and year end to system-generated reports. (AS 2301.45)

The issuer's year-end inventory included work-in-progress and finished goods. The firm did not test the accuracy and completeness of issuer information the firm used to test inventory costs. (AS 1105.10)

The component held inventory at multiple locations. For one location the firm selected for testing two controls over inventory that consisted of periodic cycle counts and management's review and approval of adjustments to the perpetual inventory records resulting from those counts. The firm did not identify and test any controls over the accuracy and completeness of the data derived from the component's inventory system that was used in the operation of these controls. (AS 2201.39)

The firm's substantive procedures to test inventory at this location utilized certain data from the component's inventory system. The firm did not test or in the alternative identify and test controls over the accuracy and completeness of these data as discussed above. (AS 1105.10)

The firm selected for testing a control over inventory that consisted of management's review of standard versus actual costs used by the issuer to record inventory. The firm did not identify and test any controls over the accuracy and completeness of a report used in the operation of this control. (AS 2201.39)

The firm selected for testing controls that consisted of management's review of the (1) measurement and calculation of certain work in progress inventory quantities and (2) historical recovery rates of certain work in process inventory. The firm did not identify and test any controls over the accuracy and completeness of certain information used in the operation of these controls. (AS 2201.39)

The issuer held certain inventory at numerous warehouses that were subject to cycle counts. The issuer's cycle-count program required this inventory to be counted at specific frequencies during the year. The following deficiencies were identified: The firm did not identify and test any controls that addressed whether all locations in each of these warehouses were counted during the year and whether each location was counted with sufficient frequency in accordance with the issuer's cycle-count program. (AS 2201.39) In addition the firm did not identify and test any controls over the accuracy and completeness of the system-generated reports the issuer used in the operation of its cycle-count controls. (AS 2201.39). In connection with our review the issuer reevaluated its controls over its inventory cycle-count program and concluded that a material weakness existed that had not been previously identified. The issuer subsequently revised its report on ICFR to reflect this material weakness and the material weakness discussed below and the firm modified its opinion on the effectiveness of the issuer's ICFR to express an adverse opinion and reissued its report.

The issuer held certain inventory at numerous warehouses that were subject to cycle counts. The issuer's cycle-count program required this inventory to be counted at specific frequencies during the year. The following deficiencies were identified: In addition the firm did not identify and test any controls over the accuracy and completeness of the system-generated reports the issuer used in the operation of its cycle-count controls. (AS 2201.39). In connection with our review the issuer reevaluated its controls over its inventory cycle-count program and concluded that a material weakness existed that had not been previously identified. The issuer subsequently revised its report on ICFR to reflect this material weakness and the material weakness discussed below and the firm modified its opinion on the effectiveness of the issuer's ICFR to express an adverse opinion and reissued its report.