Explorer

For certain contracts the issuer recognized revenue over time based on costs incurred to date relative to total estimated costs to complete. The firm's substantive procedures to test this revenue and the related accounts included (1) selecting a sample of contracts that exceeded a monetary threshold (2) selecting a sample of costs incurred and billings to customers during the year and (3) performing analytical procedures. The following deficiencies were identified: · For the analytical procedures over certain other revenue the firm identified a difference in excess of the firm's established threshold but did not obtain any evidential matter to evaluate the difference. (AS 2305.21)

The firm's substantive procedures to test three of these types of revenue included analytical procedures. The following deficiencies were identified: · The firm did not determine whether the expectations for the three types of revenue used in these analytical procedures were based on predictable relationships. (AS 2305.13 and .14)

The firm's substantive procedures to test three of these types of revenue included analytical procedures. The following deficiencies were identified: · The threshold that the firm established to investigate differences for two types of revenue was too high to identify misstatements that could be material either individually or in the aggregate. (AS 2305.20)

The firm's substantive procedures to test three of these types of revenue included analytical procedures. The following deficiencies were identified: · The firm identified a difference in excess of the firm's established threshold for the third type of revenue but did not evaluate this difference beyond inquiry of management. (AS 2305.21)

The issuer had multiple subsidiaries. During the year the issuer entered into a certain type of transaction through one of its subsidiaries. The following deficiency was identified: · The firm did not evaluate whether the nature of these transactions required the firm to take any action in response to certain information regarding this transaction that indicated a possible illegal act. (AS 2405.10)