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The issuer recognized various types of revenue from one of its segments. The following deficiencies were identified: · The firm selected for testing a control over the annual adjustments to the contract prices that the issuer entered into its revenue system and used to calculate and recognize revenue. The firm did not identify and test any controls over the completeness of certain data that were used in the performance of this control. (AS 2201.39)

The issuer recognized various types of revenue from one of its segments. The following deficiencies were identified: · The firm selected for testing a control over the annual adjustments to the contract prices that the issuer entered into its revenue system and used to calculate and recognize revenue. One aspect of this control consisted of the control owner's review of a sample of these pricing adjustments. The firm did not evaluate whether the control was designed to satisfy the issuer's control objective given the high rate of discrepancies the control owner identified in the sample reviewed. (AS 2201.42)

The issuer recognized various types of revenue from one of its segments. The following deficiencies were identified: · The firm selected for testing an automated control over the calculation of revenue for this segment by the issuer's billing system. The firm did not test the operating effectiveness of this control for three of the issuer's types of revenue related to this segment. (AS 2201.44)

The issuer recognized various types of revenue from one of its segments. The following deficiencies were identified: · The sample sizes the firm used in certain of its substantive procedures to test revenue and accounts receivable for this segment 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 recognized various types of revenue from one of its segments. The following deficiencies were identified: · For the type of revenue subject to the first deficiency discussed above the firm's substantive procedures to test revenue and related accounts receivable consisted of performing tests of details. The firm used certain system-generated data to provide evidence related to revenue recognition in its substantive testing. 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 data that the firm used in its substantive testing. (AS 1105.10)

For certain loans the quantitative and qualitative components of the issuer's ACL were calculated using models that relied upon certain current and historical loan data and forecasted macroeconomic scenarios. The following deficiencies were identified: · The issuer compiled the forecasted macroeconomic scenarios it developed into a spreadsheet and distributed the spreadsheet to various users who had access to make changes to the data in the spreadsheet. The firm did not identify and test any controls over the accuracy and completeness of any changes made by users to the data in the spreadsheet. (AS 2201.39)

For certain loans the quantitative and qualitative components of the issuer's ACL were calculated using models that relied upon certain current and historical loan data and forecasted macroeconomic scenarios. The following deficiencies were identified: · The firm identified and tested controls that consisted of the control owner's recalculation of the qualitative ACL for certain loans. The firm did not identify and test any controls over the accuracy and completeness of the forecasted macroeconomic scenarios used in the control owner's recalculation. (AS 2201.39)

For certain loans the quantitative and qualitative components of the issuer's ACL were calculated using models that relied upon certain current and historical loan data and forecasted macroeconomic scenarios. The following deficiencies were identified: · The firm identified and tested a control that consisted of the issuer's review of its ability to forecast the quantitative component of the issuer's ACL. The firm did not test the aspect of this control that addressed the accuracy and completeness of certain historical loan data and macroeconomic scenarios used in the operation of this control. (AS 2201.42 and .44)

The firm selected for testing controls that consisted of reviews of significant assumptions underlying the cash-flow forecasts used in the issuer's annual goodwill impairment assessment. 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)

Due to the deficiency discussed above 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 2510.11)

The issuer entered into contracts with certain customers that required revenue to be recognized over time based on costs incurred to date relative to total estimated costs to complete these contracts. The following deficiencies were identified: · The firm selected for testing a control that included a preliminary review of certain profit margin metrics by contract to identify items for further investigation. The firm did not identify and test any controls over the completeness of certain data underlying these performance metrics. (AS 2201.39)

The issuer entered into contracts with certain customers that required revenue to be recognized over time based on costs incurred to date relative to total estimated costs to complete these contracts. The following deficiencies were identified: · The firm's approach for substantively testing this revenue was to review and test management's process. The firm did not sufficiently evaluate the reasonableness of certain significant assumptions that management used as inputs into its revenue recognition model because its procedures were limited to inquiring of management and performing a retrospective review to determine whether prior projections were consistent with actual results. (AS 2501.09 .10 and .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.]

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 issuer is a franchisor and its system automatically calculates and records certain types of revenue and one type of expense based on the unique scenarios contained in franchisee-specific contracts and transactional data reported by its franchisees. The firm selected for testing automated controls over the calculation of these types of revenue and this expense. The firm did not sufficiently test the configuration of these automated controls because it limited its testing to only certain of the contractual scenarios without addressing the risks of material misstatement associated with the untested scenarios. (AS 2201.42 and .44)

The issuer is a franchisor and its system automatically calculates and records certain types of revenue and one type of expense based on the unique scenarios contained in franchisee-specific contracts and transactional data reported by its franchisees. The firm did not identify and test any controls over the transactional data that the franchisees reported to the issuer and that were significant inputs used to calculate these types of revenue and this expense. (AS 2201.39)

The issuer is a franchisor and its system automatically calculates and records certain types of revenue and one type of expense based on the unique scenarios contained in franchisee-specific contracts and transactional data reported by its franchisees. The firm used transactional data that the franchisees reported to the issuer in the testing of these types of revenue and this expense. The firm did not evaluate the relevance and reliability of this information. (AS 1105.04 and .06)

The issuer is a franchisor and its system automatically calculates and records certain types of revenue and one type of expense based on the unique scenarios contained in franchisee-specific contracts and transactional data reported by its franchisees. The sample size the firm used in certain of its substantive procedures to test one type of 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 issuer used an internally developed IT system to track the volume of services provided for one type of revenue. In its testing of controls over this revenue the firm tested various automated and IT-dependent manual controls that used data from this system. The firm selected for testing a control over change management that consisted of a review of activity of certain developers with change access to this system. The firm did not evaluate whether this control was designed to address the risk of material misstatement with respect to developers with change access that were not selected for review. (AS 2201.42)

The issuer used an internally developed IT system to track the volume of services provided for one type of revenue. In its testing of controls over this revenue the firm tested various automated and IT-dependent manual controls that used data from this system. The firm selected for testing a control over change management that consisted of a review of activity of certain developers with change access to this system. As a result of the deficiency in the firm's testing of the IT general control the firm's testing of the various automated and IT-dependent manual controls was not sufficient. (AS 2201.46)

As a result of the audit deficiencies the firm did not perform sufficient substantive procedures to test or sufficiently test controls over the accuracy and completeness of certain system-generated data it used in its substantive testing of this revenue. (AS 1105.10)

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 selected for testing a control that consisted of a committee's review of certain assumptions used to estimate the quantitative component of the ACL. 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 control that consisted of the review of the issuer's risk assessment for certain graded loans. This control included the issuer's assessment to determine which of these loans would be subject to an independent loan-grade review. The loan grades were an important factor in estimating the ACL. The firm did not identify that this control excluded certain loans from the issuer's assessment. (AS 2201.42)

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

The issuer used forecasted information to monitor its compliance with contractual debt covenants as part of the evaluation of its ability to continue as a going concern. The firm selected for testing a control that consisted of the issuer's review of the reasonableness of this forecasted information. The firm did not evaluate the specific review procedures that the control owners performed to assess the reasonableness of this forecasted information. (AS 2201.42 and .44)

The firm used certain forecasted information that it obtained from a third party to evaluate whether or not there was substantial doubt about the issuer's ability to continue as a going concern. The firm did not evaluate the relevance and reliability of this information. (AS 1105.04 and .06)

The firm identified a control deficiency related to the accuracy and completeness of loan information entered into the issuer's loan systems at origination and that was used in the estimation of the ACL for certain loans. The firm identified and tested three compensating controls that it believed mitigated this deficiency. The firm did not identify that the control owners used loan information in the performance of these compensating controls that was produced by the loan systems that were subject to the control deficiency. (AS 2201.68)

In determining whether the control deficiency represented a material weakness the firm did not sufficiently evaluate the magnitude of the potential misstatements because it did not consider the potential effects on the calculated ACL related to the deficiency described above. (AS 2201.62)

The firm selected for testing a control that consisted of a committee's review of securities to determine whether they met certain quantitative or qualitative factors that would indicate that these securities should be evaluated for possible impairment. The firm did not test an aspect of the control that addressed whether securities that met certain of those qualitative factors were identified for evaluation. (AS 2201.42 and .44)

The issuer used policyholder data as the basis for its actuarial valuation of certain insurance-related assets and liabilities including insurance reserves. The firm selected for testing a control that consisted of the reconciliation of policyholder data between the issuer's policy administration system and the issuer's actuarial valuation system. The firm did not identify and test any controls over the completeness of the reports generated from each of these systems that were used in the operation of this control. (AS 2201.39)

The issuer recognized certain revenue when a product was shipped or upon completion of a service. The firm selected for testing a control over this revenue that consisted of the comparison of the terms of each sales transaction entered into the issuer's system to corresponding invoices purchase orders and shipping or service documents before revenue was recognized. The firm's procedures were not sufficient because the firm did not test whether the control owners reviewed evidence that products had been shipped or services had been rendered. (AS 2201.42 and .44)

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 sample sizes the firm used in certain of its substantive procedures to test this revenue for these locations 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 control testing discussed above. (AS 2301.16 .18 and .37; AS 2315.19 .23 and .23A)

During the year under audit the firm identified conditions and events that indicated there could be substantial doubt about the issuer's ability to continue as a going concern for a reasonable period of time and concluded that the substantial doubt was alleviated by management's plans. The firm did not sufficiently evaluate certain assumptions that the issuer used to project that it would comply with its debt covenants which was a significant factor in management's plans to overcome the adverse effects of the conditions and events. (AS 1105.04 and .06; AS 2415.08)

The issuer provided an external specialist certain demographic and employment data that were used to estimate the issuer's projected benefit obligation. The firm selected for testing a control that included a review of the accuracy of these data at an aggregated level and the investigation of year-over-year variances in the aggregated data. The firm did not evaluate whether the performance of the review at an aggregated level in conjunction with certain thresholds the control owner used to investigate the variances were sufficiently precise to detect misstatements that could be material. (AS 2201.42)

For certain revenue the issuer provided qualified customers with volume rebates that it estimated based on historical sales data. The firm selected for testing a control that consisted of the recalculation and reconciliation to the general ledger of these rebates. The firm did not identify and test any controls over the accuracy and completeness of the historical sales data 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 and completeness of the historical sales data that the firm used in its substantive testing of the volume rebates. (AS 1105.10)

The sample size the firm used in certain of its substantive procedures to test the volume rebates 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 issuer used a service organization to manage its deferred compensation plan. The firm selected for testing a control that consisted of the issuer's review of the service auditor's report on the operating effectiveness of the service organization's controls. The following deficiencies were identified: · The firm did not evaluate whether the issuer had implemented the appropriate complementary user entity controls to meet the control objectives stated in the service auditor's report. (AS 2201.39 and .B22)

The firm did not identify and evaluate the significance to the financial statements of an IFRS departure related to the valuation of certain inventory. (AS 2810.30)

The firm selected for testing controls that consisted of the issuer's reviews of forecasts and certain assumptions used in the annual goodwill impairment analyses. The firm did not identify and test any controls over the accuracy and completeness of certain data used in the operation of one of these controls. (AS 2201.39)

The firm's approach for substantively testing the reserve for excess and slow moving inventory included developing an independent expectation of the issuer's net inventory including finished goods inventory and work-in-process inventory. The firm developed its expectation using gross revenue data for the last three months of the year the period of which was consistent with the return period for finished goods inventory. The firm did not perform procedures to support the appropriateness of using three months of gross revenue as the basis for developing its expectation of net inventory. (AS 2501.09 .10 and .12) [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 ending on or after December 15 2020.]

The issuer identified indicators of potential impairment and performed an impairment analysis for each cash-generating unit. The firm selected for testing a control that consisted of the issuer's review of the carrying value and recoverable amount calculation used in the impairment analysis. The firm did not evaluate the specific review procedures that the control owner performed to assess the reasonableness of the carrying value and recoverable amount calculation used in these analyses. (AS 2201.42 and .44)

The issuer entered into a contract with a customer in which revenue was recognized on a gross or net basis depending on the nature of the sales transactions and terms of the contract. In its testing the firm identified evidence indicating that revenue from certain sales transactions recognized on a net basis may have met the criteria prescribed in International Financial Reporting Standard 15 Revenue from Contracts with Customers ('IFRS 15') for recognition on a gross basis. The firm did not perform any substantive procedures to evaluate (1) this contradictory evidence and the related effect on revenue recognition and (2) whether the issuer's recognition of revenue from these transactions was in conformity with IFRS 15. (AS 2810.03 and .30)

For loans that were collectively evaluated for impairment the issuer estimated the ALL using models and methodologies based on assumptions judgment and other data and applying certain post-model adjustments. The issuer determined post-model adjustments by comparing the model to a benchmark and/or considering data for each loan portfolio. The following deficiencies were identified: - The firm selected for testing a control that consisted of the issuer's review of the post-model adjustments for each loan portfolio. The firm did not evaluate the specific review procedures that the control owners performed to assess the appropriateness and reasonableness of certain post-model adjustments. (AS 2201.42 and .44)

For loans that were collectively evaluated for impairment the issuer estimated the ALL using models and methodologies based on assumptions judgment and other data and applying certain post-model adjustments. The issuer determined post-model adjustments by comparing the model to a benchmark and/or considering data for each loan portfolio. The following deficiencies were identified: - The firm selected for testing a control that consisted of the issuer's review of the post-model adjustments for each loan portfolio. The firm did not identify and test any controls over the (1) methods and assumptions used by the issuer to determine the benchmarks used in the operation of this control and (2) accuracy and completeness of certain data used in the operation of this control. (AS 2201.39)

For loans that were collectively evaluated for impairment the issuer estimated the ALL using models and methodologies based on assumptions judgment and other data and applying certain post-model adjustments. The issuer determined post-model adjustments by comparing the model to a benchmark and/or considering data for each loan portfolio. The following deficiencies were identified: - The firm selected for testing another control that consisted of the issuer's annual review of the appropriateness of the assumptions used in the model for each loan portfolio. The firm did not identify that this control was not designed to allow the issuer to evaluate whether certain factors would have an effect on the issuer's models due to the frequency and timing in which this control operated. (AS 2201.42)

For loans that were collectively evaluated for impairment the issuer estimated the ALL using models and methodologies based on assumptions judgment and other data and applying certain post-model adjustments. The issuer determined post-model adjustments by comparing the model to a benchmark and/or considering data for each loan portfolio. The following deficiencies were identified: - The firm's approach for substantively testing the ALL was to review and test management's process. The firm did not perform procedures to evaluate the reasonableness of the (1) methods and assumptions used by the issuer to determine the benchmarks and (2) assumptions used by the issuer to develop certain post-model adjustments both of which were used by the issuer to determine the ALL. (AS 2501.09 .10 and .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 ending on or after December 15 2020.]

The firm selected for testing controls that consisted of the issuer's reviews of forecasts and certain assumptions used in the annual goodwill impairment analyses. The firm did not evaluate the specific review procedures that the control owners performed to assess the reasonableness of the forecasts and certain assumptions used in these analyses. (AS 2201.42 and .44)

The issuer used forecasted cash flows that it developed using various assumptions including forecasted revenue and gross margins in its evaluation of its ability to continue as a going concern. Subsequent to year end but prior to the issuance of the financial statements the issuer entered into a debt agreement that included a guarantee that required it to make payments to holders of this debt if certain criteria were met. The following deficiencies were identified: · The firm selected for testing a control that included the issuer's review of the forecasted cash flows used in its going concern evaluation. The firm did not evaluate the specific review procedures that the control owner performed to assess (1) the reasonableness of the forecasted revenue and gross margin assumptions and (2) whether any potential payments related to the guarantee should have been included in the forecasted cash flows. (AS 2201.42 and .44) In connection with our review the issuer reevaluated whether any potential guaranteed payments should have been included in its evaluation of its ability to continue as a going concern and concluded that a material misstatement existed that had not been previously identified. The issuer subsequently restated its financial statements and the firm revised and reissued its report on the financial statements. The issuer also reevaluated its controls over its going concern evaluation and subsequent events disclosures and concluded that material weaknesses existed that had not been previously identified. The issuer subsequently reflected these material weaknesses in a revision of its report on ICFR and the firm revised and reissued its report to include these additional material weaknesses.