Explorer

With respect to the issuer's disclosures related to revenue the following deficiencies were identified: · The firm selected for testing certain controls that included a review of the issuer's revenue disclosures. The firm did not evaluate the specific review procedures that the control owner performed to evaluate whether these disclosures were presented in conformity with GAAP. (AS 2201.42 and .44)

With respect to the issuer's disclosures related to revenue the following deficiencies were identified: · The firm did not identify and evaluate the issuer's omission of certain revenue disclosures that were required under FASB ASC Topic 606. (AS 2810.30 and .31)

With respect to the issuer's disclosures related to revenue the following deficiencies were identified: · The firm did not evaluate the significance of the issuer's omission of another required revenue disclosure that the firm identified through its substantive procedures. (AS 2810.30 and .31)

With respect to the issuer's disclosures related to revenue the following deficiencies were identified: · The firm identified a misstatement in a required disclosure under FASB ASC Topic 606 related to the issuer's remaining performance obligations. The firm did not appropriately evaluate whether this uncorrected misstatement was material because the firm understated its projected misstatement. (AS 2810.17)

The issuer recognized revenue based on contracts with customers that included standard and nonstandard terms. The firm did not identify and test any controls over the issuer's identification and evaluation of contract terms other than pricing that could affect revenue recognition. (AS 2201.39)

The firm's substantive procedures included an evaluation of the terms for a sample of the issuer's contracts with customers. The firm did not evaluate the nonstandard contract terms included in these contracts and whether these terms could have had an effect on revenue recognition. (AS 2301.08 and .13)

For certain of the issuer's revenue the firm did not identify and test any controls that addressed whether the issuer satisfied its performance obligation before recognizing revenue. (AS 2201.39)

The firm's internal inspection program inspected this audit and reviewed one of these areas but did not identify the deficiencies below. The issuer recognized revenue from contracts that included multiple performance obligations and allocated the total transaction price to the separate performance obligations based on relative standalone selling prices (SSPs). The issuer used various methods to determine the SSPs for each of the performance obligations. The firm did not evaluate certain evidence that suggested that the issuer's methods to determine the SSPs and the resulting allocation of the transaction price to the separate performance obligations may not be appropriate. (AS 2501.10; AS 2810.03)

The firm's substantive procedures to test certain of the issuer's revenue disclosures consisted of tracing the amounts disclosed to schedules prepared by the issuer. The firm did not perform any procedures to test or test any controls over the accuracy and completeness of these issuer-prepared schedules. (AS 1105.10)

The firm's sample for testing certain revenue was too small to provide sufficient appropriate audit evidence because in determining the sample size the firm did not take into account tolerable misstatement the allowable risk of incorrect acceptance and the characteristics of the population including the expected size and frequency of misstatements. (AS 2315.16 .19 .23 and .23A)

The firm's substantive procedures to test certain of the issuer's revenue disclosures consisted of tracing the amounts disclosed to schedules prepared by the issuer. The firm did not perform any procedures to test or test any controls over the accuracy and completeness of these issuer-prepared schedules. (AS 1105.10)

The issuer recognized revenue from certain contracts over time using an input method based on labor hours incurred. The following deficiencies were identified: · The firm did not perform any substantive procedures to evaluate the reasonableness of the estimated labor hours to complete contracts that the firm selected for testing beyond inquiring of project managers. (AS 2501.16)

The issuer recognized revenue from certain contracts over time using an input method based on labor hours incurred. The following deficiencies were identified: · For certain of this revenue the firm did not perform any substantive procedures to test whether the issuer satisfied its performance obligations before recognizing revenue. (AS 2301.08 and .13)

The issuer recognized revenue from certain contracts over time using an input method based on labor hours incurred. The following deficiencies were identified: · The firm identified a misstatement in its testing of this revenue and the issuer concluded that this misstatement represented a control deficiency. The firm did not evaluate the severity of the deficiency and the effect on its control risk assessment. (AS 2301.34)

The issuer recognized revenue from certain contracts over time using an input method based on labor hours incurred. The following deficiencies were identified: · The sample sizes the firm used in its substantive procedures to test this revenue were too small to provide sufficient appropriate audit evidence because these procedures were designed based on a level of control reliance that was not supported due to the deficiency in the firm's evaluation of the control deficiency discussed above. (AS 2301.16 .18 and .37; AS 2315.19 .23 and .23A)

The firm used an issuer-prepared schedule in its substantive testing of one of the issuer's revenue disclosures but did not perform any procedures to test or test any controls over the accuracy of this schedule. (AS 1105.10)

The firm used an issuer-prepared schedule in its substantive testing of certain of the issuer's revenue disclosures but did not perform any procedures to test or test any controls over the accuracy of this schedule. (AS 1105.10)

The issuer used an information-technology (IT) system to process and record transactions related to revenue at one segment. In its testing of controls over this revenue the firm tested an IT-dependent manual control that used data and reports generated or maintained by this system. As a result of the deficiencies in the firm's testing of IT general controls (ITGCs) discussed below the firm's testing of this IT-dependent manual control was not sufficient. (AS 2201.46)

The issuer identified segregation of duties conflicts related to individuals who had the ability to both develop and implement changes to this system and implemented controls to monitor these conflicts. The firm identified and tested these controls but did not identify that the individuals that the issuer identified as having the segregation of duties conflicts also had administrative access to the tool that the control owners used to monitor the conflicts. (AS 2201.42 and .44)

The issuer identified segregation of duties conflicts related to individuals who had the ability to both develop and implement changes to this system and implemented controls to monitor these conflicts. The firm did not identify and test any controls over the accuracy and completeness of the reports generated by the tool that the control owners used in the operation of these controls. (AS 2201.39)

The firm did not identify and evaluate the issuer's omission of a required disclosure under FASB ASC Topic 270 Interim Reporting related to the aggregate effect of a year-end adjustment that the issuer recorded in the fourth quarter. (AS 2810.30 and .31)

Certain of the issuer's revenue arrangements included multiple performance obligations. The issuer allocated the total transaction price for each of these arrangements to the separate performance obligations based on the issuer's estimate of the relative standalone selling prices. The following deficiencies were identified: · The firm selected for testing a control that consisted of the issuer's reviews of the estimated standalone selling prices. The firm did not evaluate the specific review procedures that the control owner performed to assess the reasonableness of certain significant assumptions used to develop the standalone selling prices. (AS 2201.42 and .44)

With respect to the issuer's revenue disclosures the following deficiencies were identified: · The firm selected for testing a control that included the issuer's review of certain revenue disclosures but did not test the aspect of the control that addressed the accuracy and completeness of the issuer-prepared schedules used to prepare these disclosures. (AS 2201.42 and .44)

With respect to the issuer's revenue disclosures the following deficiencies were identified: · The firm used these issuer-prepared schedules in its substantive testing of these revenue disclosures but did not perform any procedures to test or sufficiently test controls over the accuracy and completeness of these schedules. (AS 1105.10)

Certain of the issuer's revenue arrangements included multiple performance obligations. The issuer allocated the total transaction price for each of these arrangements to the separate performance obligations based on the issuer's estimate of the relative standalone selling prices. The following deficiencies were identified: · The firm's approach for substantively testing the estimated standalone selling prices was to test the issuer's process. The firm selected a sample of revenue arrangements for testing but did not perform procedures to evaluate the reasonableness of certain significant assumptions used to develop the standalone selling prices beyond performing a sensitivity analysis for certain revenue arrangements selected for testing. (AS 2501.16)

During the year the issuer recognized certain revenue upon its delivery of products to a customer and also delivered additional products to this customer in exchange for the return of products sold to the customer in the previous year. The firm did not identify and evaluate that the issuer's conclusion that certain criteria required to recognize revenue for the products sold to this customer had been met was not in conformity with FASB ASC Topic 606 Revenue from Contracts with Customers. (AS 2810.30)

During the year the issuer recognized certain revenue upon its delivery of products to a customer and also delivered additional products to this customer in exchange for the return of products sold to the customer in the previous year. The firm did not identify and evaluate that the issuer's conclusion that the exchange of products did not represent a product return was not in conformity with FASB ASC Topic 606. (AS 2810.30)

During the year the issuer recorded revenue from bill-and-hold arrangements with one of its customers. The following deficiencies were identified: · The firm did not identify and test any controls that addressed whether the issuer had met certain revenue recognition criteria for these bill-and-hold arrangements. (AS 2201.39)

With respect to certain of the issuer's disclosures related to revenue the following deficiencies were identified: · The firm selected for testing a control that included the issuer's review of its financial statement disclosures. The firm did not identify and test any controls over the accuracy and completeness of certain issuer-prepared schedules related to revenue that the control owners used in the operation of this control. (AS 2201.39)

With respect to certain of the issuer's disclosures related to revenue the following deficiencies were identified: · The firm used these issuer-prepared schedules in its substantive testing of these revenue disclosures but did not perform any procedures to test or test any controls over the accuracy and completeness of these schedules. (AS 1105.10)

The issuer recognized certain revenue based on customer contracts that included financing arrangements with the customer. The firm selected for testing a control over this revenue that consisted of the issuer's review and approval of the credit application supporting the customer's ability and intent to pay. The firm did not evaluate the specific review procedures that the control owners performed to assess whether the customer contracts had met the collectability criteria before revenue was recognized. (AS 2201.42 and .44)

The firm's substantive procedures to test this revenue consisted of selecting a sample of transactions for testing. The firm did not evaluate whether these transactions had met the collectability criteria before revenue was recognized beyond reviewing the customer's credit application. (AS 2301.08)

During the year the issuer recorded revenue from bill-and-hold arrangements with one of its customers. The following deficiencies were identified: · The firm did not perform substantive procedures to evaluate whether the issuer had met certain revenue recognition criteria for these bill-and-hold arrangements beyond reading an issuer-prepared memorandum. (AS 2301.08 and .13)

The firm's internal inspection program had inspected this audit reviewed these areas and also identified the deficiencies below. The issuer recorded transactions related to revenue 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 less extensive audit procedures. To address the risks of material misstatement related to revenue for these business units the firm selected for testing various entity-level controls. The following deficiencies were identified: · For one segment the firm selected for testing controls that consisted of the issuer's reviews of the forecasts that were used in its entity-level controls over this segment including the assumptions used in these forecasts. The firm did not evaluate the specific review procedures that the control owners performed to assess the reasonableness of these assumptions. (AS 2201.42 and .44)

The firm's internal inspection program had inspected this audit reviewed these areas and also identified the deficiencies below. The issuer recorded transactions related to revenue 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 less extensive audit procedures. To address the risks of material misstatement related to revenue for these business units the firm selected for testing various entity-level controls. The following deficiencies were identified: · For a second segment the firm selected for testing a control that consisted of the issuer's monthly comparisons of prior-period results to current-period results. The firm did not evaluate the specific review procedures that the control owners performed to determine whether items identified for follow up had been appropriately resolved. (AS 2201.42 and .44)

The firm's internal inspection program had inspected this audit reviewed these areas and also identified the deficiencies below. The issuer recorded transactions related to revenue 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 less extensive audit procedures. To address the risks of material misstatement related to revenue for these business units the firm selected for testing various entity-level controls. The following deficiencies were identified: · For a third segment the firm selected for testing a control that consisted of the issuer's quarterly comparisons of prior-period results to current-period results. The firm did not evaluate the review procedures that 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)

During the year the issuer recorded revenue from bill-and-hold arrangements with one of its customers. The following deficiencies were identified: · The firm did not identify and evaluate the issuer's omission of a required disclosure under FASB ASC Topic 606 Revenue from Contracts with Customers related to when performance obligations are satisfied under bill-and-hold arrangements. (AS 2810.30 and .31)

The firm did not perform any substantive procedures to test whether the issuer satisfied its performance obligations before revenue was recognized. (AS 2301.08 and .13)

The firm selected a sample to test revenue transactions. The following deficiencies were identified: · The sample size the firm used to perform these substantive procedures was too small to provide sufficient appropriate audit evidence because the firm did not take into account the relevant factors in determining its sample size including tolerable misstatement for the population the allowable risk of incorrect acceptance and the characteristics of the population. (AS 2315.16 .19 .23 and .23A)

The firm selected a sample to test revenue transactions. The following deficiencies were identified: · For the transactions selected for testing the firm did not perform any procedures to evaluate the terms and conditions of the issuer's contracts with these customers to determine if the revenue was recognized in conformity with FASB ASC Topic 606 Revenue from Contracts with Customers. (AS 2301.08 and .13)

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

The firm did not identify and evaluate a departure from GAAP related to the issuer's omission of certain disclosures related to revenue. (AS 2810.30 and .31)

The firm did not perform any substantive procedures to evaluate the appropriateness of the issuer's recognition of revenue. (AS 2301.08 and .13)

The firm did not perform procedures to evaluate the relevance and/or reliability of certain information it used as audit evidence in testing revenue. (AS 1105.04 and .06)

The firm did not evaluate the business purpose (or lack thereof) of the revenue transactions including whether they may have been entered into to engage in fraudulent financial reporting or conceal misappropriation of assets given certain facts regarding the transactions. (AS 2401.67)

The sample size the firm used in certain of its substantive procedures to test revenue was too small to provide sufficient appropriate audit evidence because it used a methodology for determining the sample size that was not designed to test an account balance or a transaction class. As a result the firm did not consider factors relevant to determining sample size for substantive testing. (AS 2315.16 .23 and .23A)

The issuer entered into contracts with certain customers which included terms and conditions specific to (1) minimum delivery amounts (2) pricing based on a market or index rate and/or (3) payment provisions in the event of default. The issuer recognized revenue from those contracts in accordance with FASB ASC Topic 606 Revenue from Contracts with Customers. The firm did not perform any procedures to evaluate whether these contracts should have instead been accounted for as derivative instruments in conformity with FASB ASC Topic 815 Derivatives and Hedging. (AS 2301.08 and .13; AS 2810.03)

The following deficiencies were identified with respect to the firm's testing of revenue: · The firm did not perform sufficient procedures to evaluate whether the issuer appropriately recognized revenue in conformity with FASB ASC Topic 606 Revenue from Contracts with Customers because the firm did not evaluate whether the transactions were an exchange for a good or service that was an output of the issuer's ordinary activities. (AS 2301.08 and .13)

The following deficiencies were identified with respect to the firm's testing of revenue: · With respect to revenue disclosures the firm did not evaluate whether the disclosures about the issuer's agreements under which they recorded revenue were an accurate description of the nature of the contractual arrangements entered into by the issuer and the counterparties to the contracts. (AS 2301.08 and .13)

The firm did not identify and evaluate a departure from GAAP related to the issuer's omission of disclosures required by FASB ASC Topic 280 Segment Reporting related to revenue from certain customers. (AS 2810.30 and .31)