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The issuer used service organizations to process and/or record transactions for revenue and related accounts and the firm used certain information including delivery information produced by these service organizations in its substantive testing of these accounts. The following deficiencies were identified: · The firm's substantive procedures to test revenue included selecting a sample of revenue transactions. For certain selections the firm did not perform substantive procedures to test this delivery information beyond comparing the information to another report from the service organization. (AS 2301.08 and .13)

For certain contracts the issuer recognized revenue over time based on costs incurred to date relative to total estimated costs to complete. The firm selected for testing a control that included the issuer's review of the (1) revenue calculations (2) accuracy and completeness of certain related information and (3) corresponding journal entries. In its testing of the operating effectiveness of this control the firm did not test these aspects. (AS 2201.44)

For revenue and related accounts the following additional deficiency related to the firm's testing of controls were identified: the firm selected for testing a control related to a revenue reconciliation. The firm did not perform procedures beyond inquiry to evaluate whether this control could effectively prevent or detect material misstatements. (AS 2201.42 and .44)

For revenue and related accounts the following additional deficiency related to the firm's testing of controls were identified: the firm used the work of the issuer's internal audit as evidence of the operating effectiveness of certain controls selected for testing over revenue and related accounts. The firm or the issuer's internal audit did not perform procedures beyond inquiry to evaluate whether these controls could effectively prevent or detect material misstatements. Further the issuer's internal audit tested certain of these controls through an interim date but the firm did not perform any procedures to update the results of the testing from that interim date to year end. (AS 2201.42 .44 and .55)

For revenue and related accounts the following additional deficiency related to the firm's testing of controls were identified: the firm used the work of the issuer's internal audit as evidence of the operating effectiveness of certain controls selected for testing over revenue and related accounts. The firm or the issuer's internal audit did not perform procedures beyond inquiry to evaluate whether these controls could effectively prevent or detect material misstatements. The firm's use of the work of internal audit did not provide sufficient appropriate audit evidence that controls related to estimating costs to complete were operating as designed given the significant amount of subjectivity and judgment involved in these controls. (AS 2201.19; AS 2605.20 and .21)

The firm performed tests of details over a sample of revenue and related accounts transactions. The firm did not perform procedures to test or test any controls over the completeness of certain system-generated reports from which it made its selections for testing. (AS 1105.10)

As a result of the firm's ITGC testing deficiency the firm did not perform sufficient substantive procedures to test revenue and related accounts because it did not test or sufficiently test controls over the accuracy and completeness of certain system-generated data that it used to substantively test these account balances. (AS 1105.10)

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 certain contracts selected for testing the firm did not perform procedures to test whether the performance obligations had been satisfied before revenue was recognized beyond comparisons to issuer-produced reports and invoices. (AS 2301.08 and .13)

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: · The firm's sample sizes to test costs incurred and billings to customers were too small to provide sufficient appropriate audit evidence because in determining the sample sizes the firm did not take into account tolerable misstatement the allowable risk of incorrect acceptance and the characteristics of the population. (AS 2315.16 .23 and .23A)

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: · The firm used certain labor rates in its substantive testing of costs incurred but did not perform procedures to test or test any controls over the accuracy of these labor rates. (AS 1105.10)

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: · The firm did not perform substantive procedures to test the occurrence of revenue or the existence of contract assets for contracts below the monetary threshold beyond performing the procedures to test a sample of costs incurred and billings to customers discussed above. (AS 1105.27; AS 2301.08 and .13)

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 revenue the firm developed its expectations in part using data derived from the recorded amounts of revenue. The firm did not evaluate whether these data were sufficiently relevant and reliable for the purpose of achieving its audit objectives. (AS 1105.04 and .06; AS 2305.16)

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 designed a substantive procedure for testing four types of revenue as a dual-purpose test. The firm performed its substantive procedure using the sample size it determined for its control testing. This sample size was too small to provide sufficient appropriate audit evidence for the substantive procedure because the firm did not use the larger of the sample sizes that would otherwise have been designed for the two separate purposes. (AS 2315.44)

The firm designed a substantive procedure for testing four types of revenue as a dual-purpose test. The firm performed its substantive procedure using the sample size it determined for its control testing. For the selected revenue transactions the firm did not perform procedures to test whether the issuer satisfied its performance obligations prior to the recognition of revenue beyond obtaining certain issuer-produced reports and testing the timing of cash receipts. (AS 2301.08 and .11)

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 firm's substantive procedures to test three of these types of revenue included analytical procedures. The following deficiencies were identified: · The firm used issuer-produced information to develop its expectation of one of these types of revenue but did not test or in the alternative test any controls over the accuracy of this information. (AS 2305.16)

The firm did not perform any substantive procedures to test a fifth type of revenue. (AS 2301.08 and .11)

The firm did not perform substantive procedures to test the deferred revenue at year end. (AS 2301.08)

The issuer used multiple information technology (IT) systems to initiate process and record transactions related to revenue and related accounts and recognized revenue as the respective performance obligations were satisfied. The following deficiency was identified: • The firm did not identify and test any controls over the satisfaction of a performance obligation which determined the point in time in which the related revenue should be recognized. (AS 2201.39)

The issuer used multiple information technology (IT) systems to initiate process and record transactions related to revenue and related accounts and recognized revenue as the respective performance obligations were satisfied. The following deficiency was identified: The firm selected for testing a control that consisted of the issuer's review and approval of certain revenue-related transactions. The firm did not identify and test any controls over the accuracy and completeness of certain system-generated data used in the operation of the control. (AS 2201.39)

The issuer used multiple information technology (IT) systems to initiate process and record transactions related to revenue and related accounts and recognized revenue as the respective performance obligations were satisfied. The following deficiency was identified: The firm did not evaluate the review procedures that 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 issuer used multiple information technology (IT) systems to initiate process and record transactions related to revenue and related accounts and recognized revenue as the respective performance obligations were satisfied. The following deficiency was identified: The firm selected for testing controls over certain revenue and related accounts that consisted of the configuration of certain IT systems to automatically (1) update the order status (2) calculate and allocate revenue and (3) update order payment information. The firm used a “test of one” approach to test these controls but did not perform procedures beyond inquiry to evaluate whether the tested configurations were applied consistently across each processing alternative to support the use of such an approach. (AS 2201.46)

The issuer used multiple information technology (IT) systems to initiate process and record transactions related to revenue and related accounts and recognized revenue as the respective performance obligations were satisfied. The following deficiency was identified: The firm selected for testing a control that consisted of the issuer's review of the revenue recognition system logic. The firm did not evaluate the review procedures that 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 issuer used multiple information technology (IT) systems to initiate process and record transactions related to revenue and related accounts and recognized revenue as the respective performance obligations were satisfied. The following deficiency was identified: The firm selected for testing a control that consisted of the issuer's review and approval of a revenue-related calculation. As a result of the deficiencies in the firm's testing of certain controls discussed above the firm did not perform sufficient procedures to test the accuracy and completeness of certain information used in the operation of this control. (AS 2201.42 and .44)

The issuer used multiple information technology (IT) systems to initiate process and record transactions related to revenue and related accounts and recognized revenue as the respective performance obligations were satisfied. The following deficiency was identified: The firm did not perform procedures to test or test any controls over the completeness and/or accuracy of certain system-generated data used in its substantive testing of revenue and related accounts. (AS 1105.10)

The issuer used multiple information technology (IT) systems to initiate process and record transactions related to revenue and related accounts and recognized revenue as the respective performance obligations were satisfied. The following deficiency was identified: 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 issuer used an information technology (IT) system to initiate process and/or record transactions related to certain revenue and related accounts. In its testing of controls over a revenue-related account the firm tested various automated and IT-dependent manual controls that used data and reports generated or maintained by this IT system. As a result of the following deficiency in the firm's testing of IT general controls (ITGCs) the firm's testing of these automated and IT-dependent manual controls was not sufficient. (AS 2201.46)

With respect to change management: The firm selected for testing change management controls over this IT system that consisted of the documentation review testing and approval of changes in a ticketing system prior to their migration into production. The firm did not perform sufficient procedures to test the operating effectiveness of these controls because it limited its selection of changes for testing to a population of changes that were initiated during the period under audit without considering changes initiated outside of the period under audit but made within the period under audit. (AS 2201.44)

As a result of the firm's ITGC testing deficiency the firm did not perform sufficient substantive procedures to test a revenue-related account because it did not test or (as discussed above) sufficiently test controls over the accuracy and completeness of certain system-generated data that it used to substantively test the account balance. (AS 1105.10)

The firm selected for testing a control over certain revenue that consisted of the issuer's inspection of source documents that were used to record the revenue. The firm did not perform sufficient procedures to test the operating effectiveness of this control because it did not test an aspect of the control involving the issuer's inspection of certain of these source documents. (AS 2201.44)

The firm did not perform procedures to test a revenue-related account beyond (1) comparing the account balance at the end of the current year to the account balance at the end of the prior year (2) testing the clerical accuracy of a report the issuer used to calculate the account balance (3) recalculating the account balance using the same information that the issuer used to calculate the balance and (4) reconciling the account balance to the general ledger. (AS 2301.08)

The firm selected for testing certain automated controls over the processing and recording of revenue transactions. The firm's testing of these automated controls using a sample of only one instance of the controls' operation was not sufficient because the firm did not test the configuration or programming of these controls or perform other procedures that would have provided sufficient appropriate audit evidence that these controls were designed and operating effectively. (AS 2201.42 and .44)

The firm identified deficiencies in the design and operating effectiveness of certain controls over revenue transactions. The firm concluded that these deficiencies represented a significant deficiency based on the firm's testing of various compensating controls. The firm did not sufficiently evaluate the severity of the control deficiencies over the processing and recording of revenue transactions because it did not identify that the compensating controls were dependent on the effectiveness of the deficient controls. (AS 2201.68)

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 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 perform substantive procedures to test or sufficiently test controls over the completeness of a system-generated report that the firm used in its substantive testing of revenue transactions. (AS 1105.10)

The issuer offered various forms of sales incentives to customers that were recorded as deductions from revenue with a corresponding liability for sales incentives. The firm selected for testing controls that consisted of the issuer's review and approval of these sales incentives. The following deficiencies were identified: · For one of these controls the firm did not test the aspect of the control that addressed the control owner's review of the accuracy of certain sales incentives. (AS 2201.42 and .44) In connection with our review the issuer reevaluated its controls over certain of these sales incentives and concluded that a material weakness existed that had not been previously identified. The issuer subsequently reflected this material weakness 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 issuer offered various forms of sales incentives to customers that were recorded as deductions from revenue with a corresponding liability for sales incentives. The firm selected for testing controls that consisted of the issuer's review and approval of these sales incentives. The following deficiencies were identified: · For another of these controls the control owner used an automated tool to assess the accuracy of certain other sales incentives. The firm did not test the configuration or programming of this tool or perform other procedures to test this tool that would have provided sufficient appropriate audit evidence that this aspect of the control was designed and operating effectively. (AS 2201.42 and .44) In connection with our review the issuer reevaluated its controls over certain of these sales incentives and concluded that a material weakness existed that had not been previously identified. The issuer subsequently reflected this material weakness 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 issuer offered various forms of sales incentives to customers that were recorded as deductions from revenue with a corresponding liability for sales incentives. The firm selected for testing controls that consisted of the issuer's review and approval of these sales incentives. The following deficiencies were identified: · The firm's testing of an aspect of these controls that addressed whether these sales incentives were appropriately recorded in the general ledger was not sufficient because the number of items the firm selected for testing did not provide sufficient appropriate audit evidence given the frequency with which the controls operated. (AS 2201.46) In connection with our review the issuer reevaluated its controls over certain of these sales incentives and concluded that a material weakness existed that had not been previously identified. The issuer subsequently reflected this material weakness 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 issuer offered various forms of sales incentives to customers that were recorded as deductions from revenue with a corresponding liability for sales incentives. The firm selected for testing controls that consisted of the issuer's review and approval of these sales incentives. The following deficiencies were identified: · The firm did not perform any procedures to test or test any controls over the completeness of the population of items from which it selected its samples for testing these controls. (AS 1105.10) In connection with our review the issuer reevaluated its controls over certain of these sales incentives and concluded that a material weakness existed that had not been previously identified. The issuer subsequently reflected this material weakness 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 performed substantive procedures to test the accuracy of certain issuer-produced data the firm used in its testing of the sales incentive liability. The sample sizes the firm used in certain of these substantive procedures were smaller than the ones the firm determined necessary to provide sufficient appropriate audit evidence. Further the firm did not perform any procedures to test or test any controls over the completeness of these data. (AS 1105.10)

With respect to two types of revenue the following deficiencies were identified: · 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 firm selected for testing various controls over the processing and recording of certain revenue. The firm did not identify and test any controls over the accuracy and/or completeness of certain data and reports the control owners used in the operation of these controls. (AS 2201.39)

With respect to two types of revenue the following deficiencies were identified: · For the first type of revenue the firm did not perform any substantive procedures to test whether the performance obligation was satisfied before revenue was recognized. (AS 2301.08)

With respect to two types of revenue the following deficiencies were identified: · For the second type of revenue the firm used issuer-produced delivery data in its substantive testing 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 did not perform procedures beyond inquiring of management and reading an issuer-prepared memorandum to evaluate whether the issuer's balance sheet presentation of certain customer deposits and sales commissions was in conformity with GAAP. (AS 2301.08)

The firm selected for testing an automated control over the appropriateness of the prices that the issuer used to record revenue. The firm did not test the programming of this automated control or perform other procedures to test this control that would have provided sufficient appropriate audit evidence that the control was designed and operating effectively. (AS 2201.42 and .44)

The firm selected for testing an automated control over the appropriateness of the prices that the issuer used to record revenue. The firm did not identify and test any controls over the accuracy and completeness of certain pricing data used in the operation of this control. (AS 2201.39)