- Inspection year
- 2021
- Report date
- 01-Dec-2022
- PCAOB release
- 104-2023-027a
- Audits reviewed
- 3
- Audits w/ Part I.A deficiencies
- 2
- Part I.A deficiency rate
- 67%
- Part I.A deficiencies
- 8
- Part I.B deficiencies
- 9
- Report
- View PDF ↗
Deficiencies (8)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The issuer recognized certain revenue from transactions with related parties. The firm did not identify and appropriately address a departure from GAAP related to the issuer's omission of a disclosure required by FASB ASC Topic 850 Related Party Disclosures related to this revenue. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 2 | Revenue | The firm sent a positive confirmation request to one of the issuer's customers for total revenue for the year and accounts receivable at year end. The customer did not respond to the aspect of the confirmation request related to revenue. The firm did not perform alternative procedures. (AS 2310.31) Financial statement audit only | AS 2310.31 | |
| 3 | Inventory | The firm did not perform any substantive procedures to test certain inputs used by the issuer to determine the cost of certain inventory. Further the firm did not perform sufficient substantive procedures to test the allocation of overhead costs to this inventory because it limited its procedures to comparing costs and production to the prior year without performing procedures to determine whether prior year costs and production would be representative of the current year. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 4 | Inventory | For certain other inventory the firm did not perform any substantive procedures to test or in the alternative identify and test any controls over the accuracy and completeness of certain reports that it used in its inventory cost testing. (AS 1105.10) Financial statement audit only | AS 1105.10 |
Issuer B4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Long-Lived Assets | During the year the issuer identified indicators of possible impairment for certain long-lived assets and engaged a specialist to determine the fair values of these assets. The firm's approach for substantively testing the fair values of these assets was to test the issuer's process. The following deficiencies were identified: - For one asset group the firm did not evaluate whether the significant assumptions developed by the company's specialist were consistent with relevant information. (AS 1105.A8b) Financial statement audit only | AS 1105.A8b | |
| 2 | Long-Lived Assets | During the year the issuer identified indicators of possible impairment for certain long-lived assets and engaged a specialist to determine the fair values of these assets. The firm's approach for substantively testing the fair values of these assets was to test the issuer's process. The following deficiencies were identified: - For another asset group the firm did not perform any procedures to evaluate the reasonableness of the significant assumptions developed by the company's specialist. (AS 1105.A8b) Financial statement audit only | AS 1105.A8b | |
| 3 | Long-Lived Assets | During the year the issuer identified indicators of possible impairment for certain long-lived assets and engaged a specialist to determine the fair values of these assets. The firm's approach for substantively testing the fair values of these assets was to test the issuer's process. The following deficiencies were identified: - For both asset groups the firm did not test or in the alternative identify and test controls over the accuracy and completeness of certain issuer-produced data that the company's specialist used. (AS 1105.A8a) Financial statement audit only | AS 1105.A8a | |
| 4 | Cash | The issuer reported certain cash at year end that included amounts held in banks located in another country that had restrictions on the convertibility and remittance of amounts outside this country. The firm received positive confirmations from financial institutions indicating that certain of these amounts consisted of term deposits with maturities beyond one year. The firm did not perform any procedures to evaluate whether the issuer properly classified these amounts as unrestricted cash and disclosed any restrictions in conformity with International Accounting Standard 7 Statement of Cash Flows. (AS 2810.03 .30 and .31) Financial statement audit only | AS 2810.3; AS 2810.30; AS 2810.31 |