- Inspection year
- 2023
- Report date
- 20-Jun-2024
- PCAOB release
- 104-2024-108
- Audits reviewed
- 12
- Audits w/ Part I.A deficiencies
- 12
- Part I.A deficiency rate
- 100%
- Part I.A deficiencies
- 92
- Part I.B deficiencies
- 27
- Report
- View PDF ↗
Deficiencies (92)
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 | Audit Evidence | The firm did not complete all necessary procedures and obtain sufficient evidence to support the representations in the auditor's report. Specifically the firm did not review the work of engagement team members to evaluate whether the (1) work was performed and documented (2) objectives of the procedures were achieved and (3) results of the procedures performed supported the conclusions reached. (AS 1105.04; AS 1201.05) Financial statement audit only | AS 1105.4; AS 1201.5 | |
| 2 | Revenue | The firm did not perform any procedures to test revenue. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 3 | Goodwill and Intangible Assets | The firm did not perform procedures to test goodwill and intangible assets beyond obtaining certain issuer-prepared schedules. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 4 | Goodwill and Intangible Assets | The firm did not identify and evaluate the issuer's omission of disclosures for goodwill and intangible assets required by FASB ASC Topic 350 Intangibles – Goodwill and Other and FASB ASC Topic 820 Fair Value Measurement. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 5 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer B10 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Audit Evidence | The firm did not complete all necessary procedures and obtain sufficient evidence to support the representations in the auditor's report. Specifically the firm did not review the work of engagement team members to evaluate whether the (1) work was performed and documented (2) objectives of the procedures were achieved and (3) results of the procedures performed supported the conclusions reached. (AS 1105.04; AS 1201.05) Financial statement audit only | AS 1105.4; AS 1201.5 | |
| 2 | Business Combinations | During the year the issuer acquired a business. The following deficiencies were identified: · The firm did not perform procedures beyond obtaining and reading the issuer's purchase price allocation schedule to test the fair value of the acquired intangible assets. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 3 | Business Combinations | During the year the issuer acquired a business. The following deficiencies were identified: · The firm did not perform any procedures to test the existence completeness and valuation of the tangible assets acquired and the liabilities assumed at the acquisition date. (AS 2301.08; AS 2501.07) Financial statement audit only | AS 2301.8; AS 2501.7 | |
| 4 | Business Combinations | During the year the issuer acquired a business. The following deficiencies were identified: · The firm did not perform any procedures to test the purchase price. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 5 | Business Combinations | During the year the issuer acquired a business. The following deficiencies were identified: · The firm did not identify and evaluate the issuer's omission of disclosures related to this business combination required by FASB ASC Topic 350 FASB ASC Topic 805 Business Combinations and FASB ASC Topic 820. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 6 | Revenue | The firm did not perform any procedures to evaluate whether the issuer met the revenue recognition criteria prior to recognizing revenue. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 7 | Inventory | The firm performed procedures to observe inventory on dates other than year end. The firm did not apply appropriate tests of intervening transactions in inventory between the count dates and year end. (AS 2510.12) Financial statement audit only | AS 2510.12 | |
| 8 | Inventory | The firm performed procedures to observe inventory on dates other than year end. The firm did not perform any procedures to test costs in inventory including whether inventory was recorded at the lower of cost or net realizable value. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 9 | Inventory | The issuer determined a reserve for inventory was not necessary. The firm did not perform any procedures to test the issuer's determination. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 10 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer C14 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Audit Evidence | The firm did not complete all necessary procedures and obtain sufficient evidence to support the representations in the auditor's report. Specifically the firm did not review the work of engagement team members to evaluate whether the (1) work was performed and documented (2) objectives of the procedures were achieved and (3) results of the procedures performed supported the conclusions reached. (AS 1105.04; AS 1201.05) Financial statement audit only | AS 1105.4; AS 1201.5 | |
| 2 | Revenue and Related Accounts | The firm did not perform any procedures to evaluate whether the issuer met the revenue recognition criteria prior to recognizing revenue. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 3 | Revenue and Related Accounts | The firm did not perform procedures to test a related liability account beyond obtaining a schedule of activity for the account for the year. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 4 | Revenue and Related Accounts | The firm did not identify and evaluate the issuer's omission of disclosures related to revenue required by FASB ASC Topic 606 Revenue from Contracts with Customers. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 5 | Revenue and Related Accounts | The firm did not perform procedures to evaluate whether the issuer should have disclosed disaggregated revenue in accordance with FASB ASC Topic 606. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 6 | Revenue and Related Accounts | To test accounts receivable the firm sent a sample of positive confirmation requests by electronic mail and received responses by electronic mail certain of which were returned with exceptions. The following deficiencies were identified: · The sample size the firm used to test accounts receivable was too small to provide sufficient appropriate audit evidence because the firm did not take into account tolerable misstatement for the population. (AS 2315.16 .23 and .23A) Financial statement audit only | AS 2315.16; AS 2315.23; AS 2315.23A | |
| 7 | Revenue and Related Accounts | To test accounts receivable the firm sent a sample of positive confirmation requests by electronic mail and received responses by electronic mail certain of which were returned with exceptions. The following deficiencies were identified: · The firm did not consider performing procedures to address the risks associated with the electronic responses such as verifying the source and contents of the confirmation responses. (AS 2310.29) Financial statement audit only | AS 2310.29 | |
| 8 | Revenue and Related Accounts | To test accounts receivable the firm sent a sample of positive confirmation requests by electronic mail and received responses by electronic mail certain of which were returned with exceptions. The following deficiencies were identified: · For the confirmations returned with exceptions the firm did not perform any procedures to evaluate the nature of those exceptions. (AS 2310.33) Financial statement audit only | AS 2310.33 | |
| 9 | Revenue and Related Accounts | The firm did not perform procedures to test the allowance for doubtful accounts beyond obtaining the activity in the account for the year. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 10 | Business Combinations | During the year the issuer acquired certain businesses. The following deficiencies were identified: · The firm did not perform procedures to test the fair value of the intangible assets beyond obtaining and reading the purchase price allocation for one of the acquisitions. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 11 | Business Combinations | During the year the issuer acquired certain businesses. The following deficiencies were identified: · The firm did not perform any procedures to test the existence completeness and fair value of the tangible assets acquired at the acquisition dates for these acquisitions. (AS 2301.08; AS 2501.07) Financial statement audit only | AS 2301.8; AS 2501.7 | |
| 12 | Business Combinations | During the year the issuer acquired certain businesses. The following deficiencies were identified: · The firm did not perform any procedures to test the purchase consideration for these acquisitions including contingent consideration. (AS 2301.08; AS 2501.07) Financial statement audit only | AS 2301.8; AS 2501.7 | |
| 13 | Business Combinations | During the year the issuer acquired certain businesses. The following deficiencies were identified: · The firm did not identify and evaluate the issuer's omission of disclosures related to these business combinations required by FASB ASC Topic 805 and FASB ASC Topic 820. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 14 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer D6 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Audit Evidence | The firm did not complete all necessary procedures and obtain sufficient evidence to support the representations in the auditor's report. Specifically the firm did not review the work of engagement team members to evaluate whether the (1) work was performed and documented (2) objectives of the procedures were achieved and (3) results of the procedures performed supported the conclusions reached. (AS 1105.04; AS 1201.05) Financial statement audit only | AS 1105.4; AS 1201.5 | |
| 2 | Revenue | The firm did not perform procedures to test revenues beyond obtaining certain issuer-produced reports and reports from external sources. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 3 | Revenue | The firm did not identify and evaluate the issuer's inaccurate disclosure of its revenue recognition policy. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 4 | Revenue | The firm did not identify and evaluate the issuer's omission of disclosures related to disaggregated revenue and significant payment terms required by FASB ASC Topic 606. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 5 | Goodwill | The firm did not perform any procedures to test goodwill. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 6 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer E4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Audit Evidence | The firm did not complete all necessary procedures and obtain sufficient evidence to support the representations in the auditor's report. Specifically the firm did not review the work of engagement team members to evaluate whether the (1) work was performed and documented (2) objectives of the procedures were achieved and (3) results of the procedures performed supported the conclusions reached. (AS 1105.04; AS 1201.05) Financial statement audit only | AS 1105.4; AS 1201.5 | |
| 2 | Revenue | The firm did not perform procedures to test revenue beyond obtaining certain external reports and issuer-produced reports. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 3 | Certain Assets and Related Liabilities | The firm did not perform procedures to test certain assets and related liabilities beyond obtaining an issuer-prepared report. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 4 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer F8 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Audit Evidence | The firm did not complete all necessary procedures and obtain sufficient evidence to support the representations in the auditor's report. Specifically the firm did not review the work of engagement team members to evaluate whether the (1) work was performed and documented (2) objectives of the procedures were achieved and (3) results of the procedures performed supported the conclusions reached. (AS 1105.04; AS 1201.05) Financial statement audit only | AS 1105.4; AS 1201.5 | |
| 2 | Revenue | The firm did not perform procedures beyond vouching a sample of journal entries to bank statements to evaluate whether the issuer had satisfied its performance obligations before revenue was recognized. Further the firm did not perform any procedures to test the completeness of the sub-ledger it used to make its selection of journal entries. (AS 1105.10; AS 2301.08) Financial statement audit only | AS 1105.10; AS 2301.8 | |
| 3 | Business Combinations | During the year the issuer acquired a business and engaged a specialist to estimate the fair value of the acquired intangible assets. The firm did not perform procedures to test the fair value of the acquired intangible assets beyond obtaining and reading the company's specialist's draft valuation report and an issuer-prepared purchase price allocation schedule. Further the firm did not perform any procedures with respect to its use of the work of the company's specialist as audit evidence. (AS 1105.A1 - .A10; 2501.07) Financial statement audit only | AS 1105.A1; AS 1105.A10; AS 1105.A2; AS 1105.A3; AS 1105.A4; AS 1105.A5; AS 1105.A6; AS 1105.A7; AS 1105.A8; AS 1105.A9; AS 2501.7 | |
| 4 | Business Combinations | The firm did not identify and evaluate the issuer's omission of disclosures related to this business combination required by FASB ASC Topic 820. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 5 | Goodwill | The issuer engaged an external valuation firm to perform a quantitative assessment of the possible impairment of goodwill. The firm did not perform procedures to test this assessment beyond obtaining and reading the valuation report prepared by the company's specialist. Further the firm did not perform any procedures with respect to its use of the work of the company's specialist as audit evidence. (AS 1105.A1 - .A10; AS 2501.07) Financial statement audit only | AS 1105.A1; AS 1105.A10; AS 1105.A2; AS 1105.A3; AS 1105.A4; AS 1105.A5; AS 1105.A6; AS 1105.A7; AS 1105.A8; AS 1105.A9; AS 2501.7 | |
| 6 | Intangible Assets | The issuer reported an impairment loss for an intangible asset. The firm did not perform any procedures to test this impairment loss. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 7 | Intangible Assets | The issuer reported an impairment loss for an intangible asset. The firm did not perform any procedures to test the amortization expense for the issuer's intangible assets. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 8 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer G11 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue and Deferred Revenue | The firm did not perform any procedures to test whether the issuer satisfied its performance obligations prior to the recognition of revenue. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 2 | Revenue and Deferred Revenue | The firm did not perform any procedures to test or identify and test controls over the accuracy and completeness of issuer-produced reports it used in its substantive procedures to test certain revenue. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 3 | Revenue and Deferred Revenue | The firm did not perform procedures beyond inquiry and obtaining the subledger details to test deferred revenue. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 4 | Revenue and Deferred Revenue | The firm did not identify and evaluate the issuer's omission of disclosures related to revenue required by FASB ASC Topic 606. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 5 | Related Party Transactions | The firm sent positive confirmation requests to related parties. The following deficiencies were identified: · The firm did not perform sufficient procedures to test related party transactions and balances because it limited its procedures to confirmation requests of the related party balances. (AS 2410.12) Financial statement audit only | AS 2410.12 | |
| 6 | Related Party Transactions | The firm sent positive confirmation requests to related parties. The following deficiencies were identified: · The firm did not identify certain conditions indicating that certain confirmation responses might not be authentic or might not have come from the purported source. As a result the firm did not perform additional audit procedures to respond to those conditions and evaluate their effect if any on the other aspects of the audit. (AS 1105.09) Financial statement audit only | AS 1105.9 | |
| 7 | Related Party Transactions | The firm sent positive confirmation requests to related parties. The following deficiencies were identified: · The firm received electronic responses to certain of its confirmation requests. The firm did not consider performing procedures to address the risks associated with the electronic responses such as verifying the source and contents of the confirmation responses. (AS 2310.29) Financial statement audit only | AS 2310.29 | |
| 8 | Related Party Transactions | The firm sent positive confirmation requests to related parties. The following deficiencies were identified: · The firm received a response from a related party in which the related party indicated that it both agreed and disagreed with the balances. The firm did not sufficiently evaluate the evidence provided by this confirmation because it did not consider the reliability of the confirmation the nature of the exceptions and whether additional evidence was needed. (AS 2310.33; AS 2810.03) Financial statement audit only | AS 2310.33; AS 2810.3 | |
| 9 | Related Party Transactions | The firm sent positive confirmation requests to related parties. The following deficiencies were identified: · The firm did not perform any procedures to test the allowance for doubtful accounts from related parties. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 10 | Related Party Transactions | The firm did not perform any procedures to test the disclosures related to the related party transactions. (AS 2410.17) Financial statement audit only | AS 2410.17 | |
| 11 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer H4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm did not perform procedures to test revenue beyond obtaining sales reports from external parties and a contract review analysis prepared by the issuer. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 2 | Share-Based Compensation | The firm did not perform procedures to test stock-based compensation beyond obtaining certain issuer-prepared reports. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 3 | Investments | The firm did not perform any procedures to test certain investments. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 4 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer I4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Related Party Transactions | The issuer reported transactions with related parties in its financial statements. The following deficiencies were identified: · The firm did not perform procedures to test payables due to related parties beyond confirming the balance with a related party who was an executive officer of the issuer. (AS 2410.12) Financial statement audit only | AS 2410.12 | |
| 2 | Related Party Transactions | The issuer reported transactions with related parties in its financial statements. The following deficiencies were identified: · The firm did not perform procedures to evaluate whether the issuer's presentation of related party transactions in the statement of cash flows was in conformity with FASB ASC Topic 230 Statement of Cash Flows. (AS 2410.17) Financial statement audit only | AS 2410.17 | |
| 3 | Related Party Transactions | The issuer reported transactions with related parties in its financial statements. The following deficiencies were identified: · The firm did not identify and evaluate the issuer's omission of disclosures related to the terms and manner of settlement of related party transactions required by FASB ASC Topic 850 Related Party Disclosures. (AS 2410.17; AS 2810.30 and .31) Financial statement audit only | AS 2410.17; AS 2810.30; AS 2810.31 | |
| 4 | Expenses | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2301.8; AS 2401.58 |
Issuer J10 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The issuer recognized several types of revenue. The following deficiencies were identified: · The firm selected a sample of transactions for certain types of revenue. The firm did not perform procedures beyond obtaining invoices and cash receipts to evaluate whether the issuer had satisfied its performance obligations prior to the recognition of revenue. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 2 | Revenue | The issuer recognized several types of revenue. The following deficiencies were identified: · The firm did not perform any procedures to evaluate the relevance and reliability of a report from an external source that it used to test another type of revenue. (AS 1105.04 and .06) Financial statement audit only | AS 1105.4; AS 1105.6 | |
| 3 | Revenue | The issuer recognized several types of revenue. The following deficiencies were identified: · The firm did not perform any procedures to test another type of revenue. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 4 | Revenue | The issuer recognized several types of revenue. The following deficiencies were identified: · The firm did not identify and evaluate the issuer's omission of disclosures related to revenue required by FASB ASC Topic 606. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 5 | Business Combinations | During the year the issuer acquired certain businesses. For two of the acquisitions the issuer engaged a specialist to estimate the fair value of the acquired intangible assets. The following deficiencies were identified: · The firm did not perform procedures to test the fair value of certain intangible assets beyond obtaining and reading the company's specialist's valuation reports and the purchase price allocations. Further the firm did not perform procedures beyond assessing the knowledge skills and ability of the company's specialist and the specialist's relationship to the issuer with respect to its use of the work of the company's specialist as audit evidence. (AS 1105.A6 - .A10; AS 2501.07) Financial statement audit only | AS 1105.A1; AS 1105.A10; AS 1105.A2; AS 1105.A3; AS 1105.A4; AS 1105.A5; AS 1105.A6; AS 1105.A7; AS 1105.A8; AS 1105.A9; AS 2501.7 | |
| 6 | Business Combinations | During the year the issuer acquired certain businesses. For two of the acquisitions the issuer engaged a specialist to estimate the fair value of the acquired intangible assets. The following deficiencies were identified: · The firm did not perform procedures beyond obtaining and reading the issuer's purchase price allocation to test the fair value of certain other intangible assets. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 7 | Business Combinations | During the year the issuer acquired certain businesses. For two of the acquisitions the issuer engaged a specialist to estimate the fair value of the acquired intangible assets. The following deficiencies were identified: · The firm did not perform procedures to test the tangible assets acquired and liabilities assumed at the acquisition dates for these acquisitions. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 8 | Business Combinations | During the year the issuer acquired certain businesses. For two of the acquisitions the issuer engaged a specialist to estimate the fair value of the acquired intangible assets. The following deficiencies were identified: · The firm did not perform any procedures to test the purchase consideration for these acquisitions including certain contingent consideration. (AS 2301.08; AS 2501.07) Financial statement audit only | AS 2301.8; AS 2501.7 | |
| 9 | Business Combinations | During the year the issuer acquired certain businesses. For two of the acquisitions the issuer engaged a specialist to estimate the fair value of the acquired intangible assets. The following deficiencies were identified: · The firm did not identify and evaluate the issuer's omission of disclosures related to these business combinations required by FASB ASC Topic 805 and FASB ASC Topic 820. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 10 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer K4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue and Related Accounts | The firm did not perform procedures to test revenue and accounts receivable beyond obtaining issuer-produced reports and reports from external sources. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 2 | Revenue and Related Accounts | The firm did not perform any procedures to test the allowance for doubtful accounts. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 3 | Business Combinations | During the year the issuer entered into a reverse merger agreement. The firm did not perform any procedures to evaluate whether the issuer's accounting for this transaction was in conformity with FASB ASC Topic 805 Business Combinations. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 4 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |
Issuer L12 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · The firm did not perform any procedures to evaluate whether the issuer appropriately (1) identified the performance obligations for these arrangements; (2) determined the standalone selling prices; and (3) allocated the transaction price to each separate performance obligation based on the standalone selling price. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 2 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · The issuer recognized one type of revenue over time based on costs incurred to date relative to total estimated costs to complete the contract. The firm did not perform procedures to test this revenue beyond obtaining invoices bank statements purchase orders and/or contracts. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 3 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · The issuer recognized one type of revenue over time based on costs incurred to date relative to total estimated costs to complete the contract. The firm did not perform procedures to test the related contract receivables and liabilities. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 4 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · For two types of revenue the firm selected a sample of transactions for testing. The sample sizes the firm used in these substantive procedures were too small to provide sufficient appropriate audit evidence because the firm did not take into account the relevant factors in determining its sample sizes including tolerable misstatement for the population the allowable risk of incorrect acceptance and the characteristics of the population. (AS 2315.16 .19 .23 and .23A) Financial statement audit only | AS 2315.16; AS 2315.23; AS 2315.23A | |
| 5 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · For one of the above two types of revenue the firm did not perform procedures to evaluate whether the issuer met its performance obligations prior to recognizing revenue beyond obtaining invoices contracts and/or cash receipts. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 6 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · To test a fourth type of revenue the firm selected a sample of transactions from one month. The firm did not perform any procedures to test the remaining population of revenue transactions. (AS 2315.24) Financial statement audit only | AS 2315.14 | |
| 7 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · The firm did not perform procedures to test the disclosures related to revenue beyond comparing total revenues in the disclosures to the statement of operations. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 8 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · The firm did not perform procedures beyond obtaining the subledgers to test accounts receivable and customer deposits. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 9 | Revenue and Related Accounts | The issuer entered into revenue arrangements with multiple elements and asserted that it allocated the total consideration from these arrangements between the different types of revenue based on the standalone selling prices. The following deficiencies were identified: · The firm did not perform any procedures to test the allowance for doubtful accounts. (AS 2501.07) Financial statement audit only | AS 2501.7 | |
| 10 | Business Combinations | During the year the issuer acquired certain businesses and engaged a specialist to estimate the fair value of the acquired intangible assets and contingent consideration. The firm did not perform procedures to test the fair value of the intangible assets and contingent consideration beyond obtaining and reading the company's specialist's valuation reports and the purchase price allocation for one of the business combinations. Further the firm did not perform any procedures with respect to its use of the work of the company's specialist as audit evidence. (AS 1105.A1 - .A10; AS 2501.07) Financial statement audit only | AS 1105.A1; AS 1105.A10; AS 1105.A2; AS 1105.A3; AS 1105.A4; AS 1105.A5; AS 1105.A6; AS 1105.A7; AS 1105.A8; AS 1105.A9; AS 2501.7 | |
| 11 | Business Combinations | The firm did not identify and evaluate the issuer's omission of disclosures related to these business combinations required by FASB ASC Topic 350 and FASB ASC Topic 805. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 | |
| 12 | Journal Entries | The firm did not perform any procedures to identify and select journal entries and other adjustments for testing to address the potential for material misstatement due to fraud. (AS 2401.58) Financial statement audit only | AS 2401.58 |