- Inspection year
- 2021
- Report date
- 01-Dec-2022
- PCAOB release
- 104-2023-029
- Audits reviewed
- 2
- Audits w/ Part I.A deficiencies
- 2
- Part I.A deficiency rate
- 100%
- Part I.A deficiencies
- 10
- Part I.B deficiencies
- 1
- Report
- View PDF ↗
Deficiencies (10)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A5 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Inventory | To substantively test the valuation of inventory the firm developed an independent expectation with respect to certain inventory. The following deficiencies were identified: - The firm did not perform any procedures to test the valuation of inventory that was not included in its independent expectation. (AS 1105.27; AS 2301.08) Financial statement audit only | AS 1105.27; AS 2301.8 | |
| 2 | Inventory | To substantively test the valuation of inventory the firm developed an independent expectation with respect to certain inventory. The following deficiencies were identified: - The firm did not perform any procedures to demonstrate it had a reasonable basis for certain assumptions it developed. (AS 2501.22) Financial statement audit only | AS 2501.22 | |
| 3 | Inventory | To substantively test the valuation of inventory the firm developed an independent expectation with respect to certain inventory. The following deficiencies were identified: - The firm did not perform procedures beyond inquiry to evaluate the reasonableness of certain assumptions it used that the issuer developed. (AS 2501.24) Financial statement audit only | AS 2501.24 | |
| 4 | Inventory | To substantively test the valuation of inventory the firm developed an independent expectation with respect to certain inventory. The following deficiencies were identified: - The firm did not perform any procedures to evaluate the relevance and reliability of certain assumptions it obtained from an external appraiser. (AS 1105.04 and .06; AS 2501.23) Financial statement audit only | AS 1105.4; AS 1105.6; AS 2501.23 | |
| 5 | Inventory | To substantively test the valuation of inventory the firm developed an independent expectation with respect to certain inventory. The following deficiencies were identified: - The firm did not perform any substantive procedures to test the completeness of certain data it used. (AS 2501.24) Financial statement audit only | AS 2501.24 |
Issuer B5 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Warrant Liability | The issuer reported a warrant liability. The firm's approach for substantively testing the fair value of this liability was to test the issuer's process. The firm did not evaluate the relevance of certain data the issuer used to develop a significant assumption. (AS 1105.04 and .06) Financial statement audit only | AS 1105.4; AS 1105.6 | |
| 2 | Warrant Liability | The issuer reported a warrant liability. The firm's approach for substantively testing the fair value of this liability was to test the issuer's process. The firm did not evaluate whether this assumption was consistent with certain information including existing market information and historical and recent experience related to the issuer's stock taking into account changes in conditions and events affecting the issuer. (AS 2501.16) Financial statement audit only | AS 2501.16 | |
| 3 | Journal Entries | The issuer recorded (1) journal entries into the general ledger during the financial reporting period and (2) adjustments during the period end financial reporting process. The firm selected for testing journal entries and adjustments meeting certain fraud criteria. The following deficiencies were identified: - The firm did not perform any procedures to test the completeness of the population of adjustments. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 4 | Journal Entries | The issuer recorded (1) journal entries into the general ledger during the financial reporting period and (2) adjustments during the period end financial reporting process. The firm selected for testing journal entries and adjustments meeting certain fraud criteria. The following deficiencies were identified: - The firm did not perform sufficient procedures to test the completeness of the population of journal entries because it limited its procedures to observation of the issuer downloading the journal entries and rolling forward certain equity accounts. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 5 | Journal Entries | The issuer recorded (1) journal entries into the general ledger during the financial reporting period and (2) adjustments during the period end financial reporting process. The firm selected for testing journal entries and adjustments meeting certain fraud criteria. The following deficiencies were identified: - The firm did not perform sufficient procedures to test the selected journal entries and adjustments because it did not examine the underlying support for the entries. (AS 2401.61) Financial statement audit only | AS 2401.61 |