- Inspection year
- 2020
- Report date
- 10-Mar-2022
- PCAOB release
- 104-2022-089
- Audits reviewed
- 3
- Audits w/ Part I.A deficiencies
- 2
- Part I.A deficiency rate
- 67%
- Part I.A deficiencies
- 13
- Part I.B deficiencies
- —
- Report
- View PDF ↗
Deficiencies (13)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A6 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Significant Estimates | The issuer used various models methodologies and assumptions to determine the estimate. The following deficiencies were identified: · The firm did not identify and test any controls over the monitoring of the models to determine whether the models remained suitable for their intended purpose or if revisions to the models were necessary. (AS 2201.39) ICFR audit only | AS 2201.39 | |
| 2 | Significant Estimates | The issuer used various models methodologies and assumptions to determine the estimate. The following deficiencies were identified: · The firm selected for testing certain controls that consisted of the review of certain methodologies and assumptions used by the issuer to determine the estimate. 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) ICFR audit only | AS 2201.42; AS 2201.44 | |
| 3 | Significant Estimates | The issuer used various models methodologies and assumptions to determine the estimate. The following deficiencies were identified: · The firm selected for testing change management and user access controls over an application used by the issuer to determine the estimate. The firm did not test or in the alternative test any controls over the completeness of the population of changes that were processed internally by the issuer's IT personnel and that the firm used in its testing of certain controls over change management. (AS 1105.10) ICFR audit only | AS 1105.10 | |
| 4 | Significant Estimates | The issuer used various models methodologies and assumptions to determine the estimate. The following deficiencies were identified: · The firm selected for testing change management and user access controls over an application used by the issuer to determine the estimate. In testing controls over user access the firm did not perform sufficient procedures to test the access controls because it limited its testing to users with certain access privileges. (AS 2201.42 and .44) ICFR audit only | AS 2201.42; AS 2201.44 | |
| 5 | Significant Estimates | The issuer used various models methodologies and assumptions to determine the estimate. The following deficiencies were identified: · The firm selected for testing certain automated controls over the calculation and classification of data within the application used by the issuer to determine the estimate. The firm's approach to testing a single instance of each of these controls was dependent on effective information technology general controls. Due to the deficiencies in the firm's testing of the change management and user access controls discussed above the firm's testing of these automated controls was not sufficient. (AS 2201.46) ICFR audit only | AS 2201.46 | |
| 6 | Significant Estimates | The issuer used various models methodologies and assumptions to determine the estimate. The following deficiencies were identified: · The firm identified deficiencies in the design of controls over certain assumptions used in the determination of the estimate. The firm identified and tested controls that it believed would mitigate these deficiencies. The firm did not identify that the compensating controls tested did not address whether changes to these assumptions were authorized. (AS 2201.68) ICFR audit only | AS 2201.68 |
Issuer B7 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm selected for testing controls that consisted of the reconciliation of data from the issuer's revenue input system to its billing systems. The firm did not identify and test any controls over the accuracy of the data used in the operation of these controls. (AS 2201.39) Both financial statement and ICFR audits | AS 2201.39 | |
| 2 | Revenue | The firm selected for testing controls that consisted of (1) the approval of new customers and creation of customer accounts in the billing systems and (2) the review and approval of new contracts and sales orders. The firm did not test or in the alternative test any controls over the completeness of the reports that the firm used in its testing of these controls. (AS 1105.10) Both financial statement and ICFR audits | AS 1105.10 | |
| 3 | Revenue | The issuer reported revenue from multiple sources. The firm did not evaluate whether persuasive evidence of an arrangement existed and delivery of services had occurred as of the date in which certain revenue transactions selected for testing had been recognized. Further the firm did not perform any substantive procedures to test certain other revenue transactions. (AS 2301.08) Both financial statement and ICFR audits | AS 2301.8 | |
| 4 | Revenue | The issuer reported revenue from multiple sources. For one source of revenue the firm did not test or in the alternative test any controls over the accuracy and completeness of data used by the issuer to calculate the revenue. (AS 1105.10) Both financial statement and ICFR audits | AS 1105.10 | |
| 5 | Accounts Receivable | The firm sent positive confirmation requests to the issuer's customers for a sample of billed accounts receivable. For positive confirmations that were not returned the firm did not perform alternative procedures that provided sufficient appropriate audit evidence that the recorded amounts of the receivables were accurate as of the confirmation date. (AS 2310.31) Both financial statement and ICFR audits | AS 2310.31 | |
| 6 | Accounts Receivable | The firm selected certain other billed account receivables and agreed the customer balances to issuer-generated invoices. The firm did not perform any procedures to evaluate the relevance and/or reliability of the invoices it used to test such receivables. (AS 1105.04 and .06) Both financial statement and ICFR audits | AS 1105.4; AS 1105.6 | |
| 7 | Accounts Receivable | The firm did not sufficiently test unbilled receivables because the firm did not perform procedures to test such receivables beyond comparing certain unbilled balances as of an interim date to the respective balances at year end. (AS 2301.08) Both financial statement and ICFR audits | AS 2301.8 |