- Inspection year
- 2020
- Report date
- 24-Mar-2022
- PCAOB release
- 104-2022-105a
- Audits reviewed
- 2
- Audits w/ Part I.A deficiencies
- 2
- Part I.A deficiency rate
- 100%
- Part I.A deficiencies
- 9
- Part I.B deficiencies
- 1
- Report
- View PDF ↗
Deficiencies (9)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A7 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Intangible Assets | The issuer completed an asset acquisition including the purchase of certain intangible assets. The issuer engaged an external specialist to estimate the fair value of the acquired intangible assets. The firm did not determine the likely sources of potential misstatements associated with these acquired intangible assets to identify and test controls that addressed the risks of misstatement for the relevant assertions including controls over the accuracy and completeness of issuer-prepared information provided to the external specialist. (AS 2201.30 and .39) Both financial statement and ICFR audits | AS 2201.30; AS 2201.39 | |
| 2 | Intangible Assets | The issuer completed an asset acquisition including the purchase of certain intangible assets. The issuer engaged an external specialist to estimate the fair value of the acquired intangible assets. The firm did not identify and test any controls over the subsequent valuation of these intangible assets. (AS 2201.39) Both financial statement and ICFR audits | AS 2201.39 | |
| 3 | Intangible Assets | The firm's approach for testing the fair value of the intangible assets acquired in the asset acquisition was to review and test management's process. The following deficiencies were identified: · The firm did not evaluate the reasonableness of cash flow projections the issuer provided to the external specialist. Further the firm did not evaluate contrary evidence related to these projections. (AS 1210.12; AS 2810.03) Both financial statement and ICFR audits | AS 1210.12; AS 2810.3 | |
| 4 | Intangible Assets | The firm's approach for testing the fair value of the intangible assets acquired in the asset acquisition was to review and test management's process. The following deficiencies were identified: · The firm did not test the relevance and reliability of data the external specialist used to develop an assumption. (AS 2502.26 .28 and .31) Both financial statement and ICFR audits | AS 2502.26; AS 2502.28; AS 2502.31 | |
| 5 | Intangible Assets | The firm's approach for testing the fair value of the intangible assets acquired in the asset acquisition was to review and test management's process. The following deficiencies were identified: · The firm did not evaluate the reasonableness of an assumption developed by the external specialist. (AS 2502.26 and .28) Both financial statement and ICFR audits | AS 2502.26; AS 2502.28 | |
| 6 | Intangible Assets | The firm's approach for testing the fair value of the intangible assets acquired in the asset acquisition was to review and test management's process. The following deficiencies were identified: · The firm did not perform any substantive procedures to test or in the alternative test any controls over the accuracy and completeness of issuer-prepared information provided to the external specialist. (AS 1210.12) Both financial statement and ICFR audits | AS 1210.12 | |
| 7 | Intangible Assets | The issuer performed a qualitative assessment to determine whether any of the acquired intangible assets were impaired. The firm did not sufficiently evaluate whether the issuer considered certain relevant events or changes in circumstances in conformity with FASB ASC Topic 350 Intangibles —Goodwill and Other including the issuer's recurring operating losses net losses negative cash flows from operations and substantial doubt about the issuer's ability to continue as a going concern when evaluating the issuer's qualitative assessment. (AS 2810.03 and .30) Both financial statement and ICFR audits | AS 2810.3; AS 2810.30 |
Issuer B2 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Participant Contributions | The firm did not perform procedures to test the accuracy and completeness of data produced from the issuer's payroll system that the firm used to test participant contributions. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 2 | Participant Contributions | The firm used certain data produced by the issuer's benefit plan record keeper in testing participant contributions. The firm did not perform any procedures that addressed the accuracy and completeness of this data. (AS 2301.08) Financial statement audit only | AS 2301.8 |