Explorer

The firm's approach for testing revenue included selecting a sample of transactions from certain months during the year. The firm did not perform any substantive procedures to test the population of revenue in the remaining months of the year. (AS 2315.24)

The firm's approach for testing revenue included selecting a sample of transactions from certain months during the year. The firm did not perform any substantive procedures to evaluate the reliability of information obtained from external sources that it used to test the transactions. (AS 1105.04 and .06)

The firm did not perform procedures to evaluate whether the issuer's revenue recognition was in conformity with GAAP. (AS 2810.30)

The firm did not identify and evaluate the significance to the financial statements of the issuer's omission of certain disclosures required by GAAP. (AS 2810.30 and .31)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. For two of the POS applications the firm did not perform any procedures to test these controls. (AS 2201.42 and .44)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. For the other POS applications the firm did not: · perform any procedures to test that the access to change the configuration was appropriately restricted; · identify and test the controls for all of the discount types that were applied to the issuer's sales transactions; and · perform sufficient procedures to determine that certain of the designated access levels were the only designations that allowed for approval of sales discounts because the procedures were limited to testing one level of access. (AS 2201.42 and .44)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. For restaurant sales the following deficiency was identified: · The firm performed certain dual-purpose testing for its substantive testing and its testing of the operating effectiveness of certain related controls: - The firm did not achieve the objectives of both the test of controls and the substantive test because the sampling unit and attributes tested were not the same. (AS 2301.47)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. For restaurant sales the following deficiency was identified: · The firm performed certain dual-purpose testing for its substantive testing and its testing of the operating effectiveness of certain related controls: - The sample size the firm used was too small to provide sufficient appropriate audit evidence because in determining the sample size the firm did not (1) take into account tolerable misstatement and the allowable risk of incorrect acceptance and (2) use the larger of the samples that would otherwise have been designed for the two separate purposes. (AS 2315.16 .19 .23 .23A and .44)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. For restaurant sales the following deficiency was identified: • The firm selected a sample of restaurant sales transactions to perform a test of details; however the firm did not perform any procedures to test revenue recognition for certain of the sampled items. (AS 2301.08 and .13)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. For restaurant sales the following deficiency was identified: • The firm did not perform procedures to test or test any controls over the accuracy and completeness of the lists and reports it used in selecting its samples and in performing its testing of restaurant sales. (AS 1105.10)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. The firm's primary substantive procedures to test franchise royalty revenue were analytical procedures. The following deficiency was identified: • The firm did not perform procedures to determine whether certain assumptions it used in developing its expectation for revenue were based on predictable relationships. (AS 2305.13 and .14)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. The firm's primary substantive procedures to test franchise royalty revenue were analytical procedures. The following deficiency was identified: • The expectation the firm used was not sufficiently precise in identifying material misstatements because the firm did not sufficiently disaggregate the data it used in its procedure to address important factors such as the number of franchisees and differences between franchisee sales and company-owned sales. (AS 2305.17)

The issuer used multiple point-of-sale (POS) applications to initiate and process revenue transactions. The firm selected for testing two controls related to the automated calculation of sales discounts and the review of those discounts by designated individuals with certain access levels. The firm did not identify and evaluate a departure from GAAP related to the issuer's omission of certain disclosures required by FASB ASC Topic 606 Revenue from Contracts with Customers. (AS 2810.30 and 31)

The issuer used information technology ('IT') applications to initiate process and record revenue. The firm identified multiple control deficiencies related to controls over logical access and program changes. The firm concluded that these deficiencies represented a significant deficiency after identifying and testing several compensating controls. The firm did not sufficiently evaluate the severity of the control deficiencies because it did not determine whether the compensating controls addressed the same objective and assertions as the ineffective controls. (AS 2201.68)

The firm selected for testing an automated control over revenue that was designed to record revenue once the issuer processed an invoice in its system. The firm did not sufficiently test this automated control because it only tested one instance which was not appropriate due to the control deficiencies described above. (AS 2201.42 .44 and .46)

The firm selected for testing certain controls that included management's review of sales contracts and comparisons of expected to actual sales. 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).

The firm did not identify and test any controls that addressed whether the performance obligation was satisfied before revenue was recognized. (AS 2201.39)

For one type of revenue the firm did not identify and test any controls that addressed whether the performance obligation was satisfied before revenue was recognized. (AS 2201.39)

The issuer entered into revenue arrangements primarily to provide services. The firm did not perform any substantive procedures beyond obtaining customer invoices and contracts to test whether the issuer's performance obligations had been satisfied before revenue was recognized. (AS 2301.08)

The firm selected certain revenue transactions for testing. The firm did not perform sufficient procedures to evaluate whether the issuer met its performance obligations before revenue was recognized because it limited its procedures to obtaining incident response logs and reports prepared by the issuer. (AS 2301.08 and .13)

The firm selected certain revenue transactions for testing. The firm did not determine whether the expectations it used in its substantive analytical procedures over revenue were based on predictable relationships. (AS 2305.13 and .14)

To test revenue the firm selected a sample of transactions. The following deficiency was identified: · The firm did not perform any procedures to test or test any controls over the completeness of the issuer-prepared reports from which it selected transactions for testing. (AS 1105.10).

To test revenue the firm selected a sample of transactions. The following deficiency was identified: · The firm did not perform sufficient procedures to evaluate whether the issuer had satisfied its performance obligations prior to recognizing certain revenue because it limited its procedures to obtaining issuer-produced documents and/or cash receipts for a selection of transactions. (AS 2301.08 and .13)

One of the issuer's categories of revenue consisted of transactions with an entity that was indirectly owned by a member of managements immediate family and other unrelated parties. The firm did not perform procedures to evaluate whether the revenue constituted related party transactions and If so were property disclosed in the financial statements. (AS 2410.14-.17; AS 2810.30 and .31)

The issuer recognized certain revenue from transactions with related parties. The firm did not identify and appropriately address a departure from GAAP related to the issuer's omission of a disclosure required by FASB ASC Topic 850 Related Party Disclosures related to this revenue. (AS 2810.30 and .31)

The firm sent a positive confirmation request to one of the issuer's customers for total revenue for the year and accounts receivable at year end. The customer did not respond to the aspect of the confirmation request related to revenue. The firm did not perform alternative procedures. (AS 2310.31)

The firm selected for testing a control that consisted of a quarterly comparison of a system-generated list of invoices used to recognize revenue to the related shipping documents to determine whether revenue was recorded in the correct period. The firm did not identify and test any controls over the accuracy and completeness of the system-generated list used in the operation of this control. (AS 2201.39)

The firm selected for testing a control that consisted of a quarterly comparison of a system-generated list of invoices used to recognize revenue to the related shipping documents to determine whether revenue was recorded in the correct period. The firm's testing of this control did not provide sufficient appropriate audit evidence of the control's operating effectiveness because the firm limited its testing to one invoice from each instance in which the control was selected for testing. (AS 2201.46)

The firm selected for testing controls that consisted of the review and approval of (1) the quantity price and other terms and conditions for each customer order and (2) any changes to customer orders. The firm did not evaluate the specific review procedures that the control owners performed to determine the appropriateness of (1) the price and quantity for each customer order and (2) changes to customer orders. (AS 2201.42 and .44)

The sample sizes the firm used in certain of its substantive procedures to test 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 deficiencies in the firm's control testing discussed above. (AS 2301.16 .18 and .37; AS 2315.19 .23 and .23A)

The firm did not identify and appropriately address a departure from GAAP related to the issuer recognizing certain revenue that did not reflect consideration promised in a contract in conformity with FASB ASC Topic 606 Revenue from Contracts with Customers. (AS 2810.30)

For this revenue the firm did not evaluate if it was probable that the issuer would collect substantially all of the consideration to which it believes it is entitled. (AS 2810.30)

For other types of revenue the firm did not sufficiently evaluate whether the revenue was appropriately recognized in conformity with ASC Topic 606 because it limited its procedures to verifying that the issuer received cash for recognized revenue. (AS 2810.30)

The firm selected for testing certain information technology general controls (ITGCs) automated controls and information technology (IT) dependent manual controls that used data and reports generated or maintained by the issuer's IT systems. The following deficiencies were identified: · The firm did not obtain an understanding of how revenue transactions are recorded and processed by certain applications. (AS 2201.30)

The firm relied on controls in its approach to testing revenue. The firm did not sufficiently test controls in the revenue process because it limited its procedures to a walkthrough. (AS 2301.16)

The sample size the firm used in its substantive procedures to test revenue was 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 deficiencies in the firm's control testing discussed above. (AS 2301.16 .18 and .37; AS 2315.19 .23 and .23A)

The firm did not test whether the issuer appropriately identified and satisfied performance obligations prior to recognizing revenue in conformity with FASB ASC Topic 606 Revenue from Contracts with Customers. (AS 2810.30)

The firm selected for testing certain information technology general controls (ITGCs) automated controls and information technology (IT) dependent manual controls that used data and reports generated or maintained by the issuer's IT systems. The following deficiencies were identified: · The firm selected for testing certain ITGCs that included a review element. The firm did not evaluate whether the control owners possessed the necessary authority and competence to perform the controls effectively. Further 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)

The firm selected for testing certain information technology general controls (ITGCs) automated controls and information technology (IT) dependent manual controls that used data and reports generated or maintained by the issuer's IT systems. The following deficiencies were identified: · The issuer used two service organizations for initiating processing and recording certain revenue. The firm did not obtain an understanding of and test any relevant controls at the service organization. (AS 2201.39 and .B19)

The firm selected for testing certain information technology general controls (ITGCs) automated controls and information technology (IT) dependent manual controls that used data and reports generated or maintained by the issuer's IT systems. The following deficiencies were identified: · The firm did not sufficiently test certain application controls because it tested only one instance which was not appropriate due to the deficiencies discussed above. (AS 2201.46)

The firm selected for testing certain information technology general controls (ITGCs) automated controls and information technology (IT) dependent manual controls that used data and reports generated or maintained by the issuer's IT systems. The following deficiencies were identified: · The firm did not test controls over the accuracy and completeness of data and reports used in the operation of certain controls. (AS 2201.39)

The firm selected for testing a review control over the determination that performance obligations related to revenue recognition had been met. 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)

The firm selected for testing a review control over the approval of customer change orders. 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)

The sample sizes the firm used in certain of its substantive procedures to test 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 deficiencies in the firm's control testing discussed above. (AS 2301.16 .18 and .37; AS 2315.19 .23 and .23A)

The firm used data produced by the issuer to test certain revenue. The firm did not perform any substantive procedures to test or sufficiently test controls over the accuracy and completeness of the data. (AS 1105.10)

The firm did not perform sufficient procedures to test whether revenue was recognized in accordance with FASB ASC Topic 606 Revenue from Contracts with Customers because it did not evaluate whether contracts were negotiated as a package with a single commercial objective where the amount of consideration to be paid in one contract depended on the price or performance of the other contract or whether goods and services promised in each contract were a single performance obligation when the contracts were entered into at or near the same time with the same customer. (AS 2301.08 and .13)

The firm did not perform sufficient procedures to evaluate and test various controls in the revenue cycle because it did not: · Evaluate the review procedures the control owner 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)

The firm did not perform sufficient procedures to evaluate and test various controls in the revenue cycle because it did not: · Identify and test controls over the upload of data into certain of the issuer's applications or over the calculation of standalone selling price. (AS 2201.39)

The sample sizes the firm used in certain of its substantive procedures to test 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 deficiencies in the firm's control testing described above. (AS 2301.16 .18 and .37; AS 2315.19 .23 and .23A)

For product revenue the firm did not evaluate the shipping terms to assess whether it was appropriate to recognize revenue upon shipment. (AS 2301.08 and .13)