- Inspection year
- 2021
- Report date
- 07-Nov-2022
- PCAOB release
- 104-2023-019
- Audits reviewed
- 1
- Audits w/ Part I.A deficiencies
- 1
- Part I.A deficiency rate
- 100%
- Part I.A deficiencies
- 11
- Part I.B deficiencies
- 2
- Report
- View PDF ↗
Deficiencies (11)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A11 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm's substantive procedures to test revenue consisted of (1) testing a sample of revenue transactions and (2) performing substantive analytical procedures. The following deficiencies were identified: - For certain selected transactions the firm did not perform sufficient procedures because it limited its testing to comparing transactions to issuer-prepared information. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 2 | Revenue | The firm's substantive procedures to test revenue consisted of (1) testing a sample of revenue transactions and (2) performing substantive analytical procedures. The following deficiencies were identified: - The firm did not perform any procedures to address an identified fraud risk related to revenue cut-off. (AS 2301.13) Financial statement audit only | AS 2301.13 | |
| 3 | Revenue | The firm's substantive procedures to test revenue consisted of (1) testing a sample of revenue transactions and (2) performing substantive analytical procedures. The following deficiencies were identified: - The firm's analytical procedures consisted of developing an expectation of revenue. The firm did not (1) test or in the alternative identify and test any controls over the accuracy and completeness of certain data it used to develop its expectations (2) develop expectations at a level of precision that provided the desired level of assurance that differences that could be potential material misstatements individually or in the aggregate would be identified for investigation and (3) establish a threshold for investigation of differences from expectations. (AS 2305.16 .17 and .20) Financial statement audit only | AS 2305.16; AS 2305.17; AS 2305.20 | |
| 4 | Revenue | The firm did not identify and evaluate the significance to the financial statements of a GAAP departure related to the omission of required disclosures under FASB ASC Subtopic 606-10-50 Revenue from Contracts with Customers— Overall — Disclosure and ASC Subtopic 235-10-50 Notes to Financial Statements — Overall — Disclosure including an accounting policy disclosure. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 5 | Related Party Transactions | The firm did not test certain related party transactions. Specifically the procedures performed to evaluate the completeness and accuracy of the financial statement disclosures about interest and accrued wages payable to a related party as well as obtaining a confirmation from the related party were performed after the issuance of the auditor's report. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 6 | Related Party Transactions | The issuer had certain loans that were due to a related party. The following deficiencies were identified: - The firm did not perform any procedures to evaluate the nature and terms of these loans. In addition the firm did not perform certain auditing procedures including procedures to evaluate the completeness and accuracy of the financial statement disclosures and obtaining signed copies of the loan agreements until after the issuance of the auditor's report. (AS 2301.08; AS 2410.12) Financial statement audit only | AS 2301.8; AS 2410.12 | |
| 7 | Related Party Transactions | The issuer had certain loans that were due to a related party. The following deficiencies were identified: - The firm did not evaluate whether a significant transaction associated with these loans was accounted for in conformity with GAAP. (AS 2410.17; AS 2810.30) Financial statement audit only | AS 2410.17; AS 2810.30 | |
| 8 | Related Party Transactions | The issuer had certain loans that were due to a related party. The following deficiencies were identified: - The firm did not perform any procedures to test the activity and year-end amounts of certain accounts associated with these loans. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 9 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing. (AS 2401.58) Financial statement audit only | AS 2401.58 | |
| 10 | Uncorrected Misstatements | The firm identified uncorrected statements in the current and prior year audits. The firm did not evaluate whether the uncorrected misstatements were material individually or in combination with other misstatements including (1) the effects of the uncorrected misstatements on the specific accounts and disclosures involved (2) the effects of the misstatements identified in the prior year on the current year financial statements and (3) the effects of misstatements detected in the current year that relate to prior years. (AS 2810.17 and .18) Financial statement audit only | AS 2810.17; AS 2810.18 | |
| 11 | Subsequent Events | The firm did not test certain subsequent event transactions disclosed in the financial statements prior to the issuance of the auditor's report. Specifically the procedures performed to test the subsequent event transactions to third party supporting documentation were performed after the issuance of the auditor's report. (AS 2301.08) Financial statement audit only | AS 2301.8 |