- Inspection year
- 2021
- Report date
- 31-Aug-2022
- PCAOB release
- 104-2022-192a
- Audits reviewed
- 2
- Audits w/ Part I.A deficiencies
- 2
- Part I.A deficiency rate
- 100%
- Part I.A deficiencies
- 6
- Part I.B deficiencies
- 1
- Report
- View PDF ↗
Deficiencies (6)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A2 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Allowance for Credit/Loan Losses | The issuer determined the qualitative reserve component of the ALL for loans that were collectively evaluated for impairment. The following deficiencies were identified: · The firm selected for testing a control that included the issuer's review of (1) certain loans for potential impairment and (2) the qualitative component of the ALL. The firm did not evaluate the specific review procedures that the control owners performed to (1) determine whether all loans identified for potential impairment were reviewed and (2) assess the reasonableness of the qualitative component of the ALL. (AS 2201. 42 and .44) Both financial statement and ICFR audits | AS 2201.42; AS 2201.44 | |
| 2 | Allowance for Credit/Loan Losses | The issuer determined the qualitative reserve component of the ALL for loans that were collectively evaluated for impairment. The following deficiencies were identified: · The firm's approach for substantively testing the ALL was to test the issuer's process. The firm did not sufficiently evaluate whether the issuer had a reasonable basis for the significant assumptions it used to determine the qualitative component of the ALL because the firm's procedures were limited to (1) reading the issuer's ALL analysis and (2) comparing the significant assumptions the issuer used at year end to those used in prior periods. (AS 2501.16) Both financial statement and ICFR audits | AS 2501.16 |
Issuer B4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Certain Assets | The firm selected for testing a control over the existence of certain assets. The firm did not evaluate how the issuer determined how frequently asset items would be reviewed and whether the issuer reviewed those items as frequently as intended. (AS 2201.42 and .44) Both financial statement and ICFR audits | AS 2201.42; AS 2201.44 | |
| 2 | Certain Assets | The firm did not identify and test any controls over the accuracy and completeness of system-generated information used by the issuer in the operation of certain controls. (AS 2201.39) Both financial statement and ICFR audits | AS 2201.39 | |
| 3 | Certain Assets | The firm did not perform any substantive procedures to test or identify and test any controls over the accuracy and completeness of system-generated information used in its substantive testing of these assets. (AS 1105.10) Both financial statement and ICFR audits | AS 1105.10 | |
| 4 | Certain Assets | The sample sizes the firm used to test these assets 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) Both financial statement and ICFR audits | AS 2301.16; AS 2301.18; AS 2301.37; AS 2315.19; AS 2315.23; AS 2315.23A |