- Inspection year
- 2023
- Report date
- 21-Jun-2024
- PCAOB release
- 104-2024-114
- Audits reviewed
- 3
- Audits w/ Part I.A deficiencies
- 3
- Part I.A deficiency rate
- 100%
- Part I.A deficiencies
- 23
- Part I.B deficiencies
- 18
- Report
- View PDF ↗
Deficiencies (23)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A10 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Equity and Equity Related Transactions | During the year the issuer issued common shares with warrants. The firm did not perform procedures to test the number of shares issued and the gross proceeds received beyond confirming the number of shares issued and outstanding at year end with the transfer agent. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 2 | Long-Lived Assets | The firm did not perform procedures to evaluate whether certain transactions were appropriately capitalized in accordance with the applicable accounting standard. (AS 2301.08 and .11) Financial statement audit only | AS 2301.8; AS 2301.11 | Significant risk |
| 3 | Long-Lived Assets | For one asset the issuer performed an assessment of this asset for possible impairment and concluded that it was recoverable. The firm did not identify that the issuer did not consider certain indicators of possible impairment in its assessment of this asset. (AS 2301.08 and .11; AS 2810.03) Financial statement audit only | AS 2301.8; AS 2301.11; AS 2810.3 | Significant risk |
| 4 | Long-Lived Assets | For a second asset the issuer estimated the recoverable amount of the asset and determined that it exceeded the asset's carrying value. The firm did not perform any procedures to test the issuer's estimated recoverability of this asset. (AS 2501.07) Financial statement audit only | AS 2501.7 | Significant risk |
| 5 | Long-Lived Assets | For a third asset the firm's approach to evaluate the recoverability of this asset was to test the issuer's process. The issuer engaged two external specialists to develop an estimate that the issuer considered along with other assumptions and information in determining the recoverability of the asset. The firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform procedures to evaluate (1) the knowledge skill and ability of one company specialist and (2) the relationship of the issuer to this specialist. (AS 1105.A3 and .A4) Financial statement audit only | AS 1105.A3; AS 1105.A4 | Significant risk |
| 6 | Long-Lived Assets | For a third asset the firm's approach to evaluate the recoverability of this asset was to test the issuer's process. The issuer engaged two external specialists to develop an estimate that the issuer considered along with other assumptions and information in determining the recoverability of the asset. The firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform any procedures to evaluate the reasonableness of certain significant assumptions developed by the company's specialists or the issuer that were used by the specialists to develop the estimate. (AS 1105.A8b; AS 2501.16) Financial statement audit only | AS 1105.A8b; AS 2501.16 | Significant risk |
| 7 | Long-Lived Assets | For a third asset the firm's approach to evaluate the recoverability of this asset was to test the issuer's process. The issuer engaged two external specialists to develop an estimate that the issuer considered along with other assumptions and information in determining the recoverability of the asset. The firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform any procedures to evaluate the relevance and reliability of external information the issuer used to determine the recoverability of the asset. (AS 1105.04 and .06) Financial statement audit only | AS 1105.4; AS 1105.6 | Significant risk |
| 8 | Long-Lived Assets | For a third asset the firm's approach to evaluate the recoverability of this asset was to test the issuer's process. The issuer engaged two external specialists to develop an estimate that the issuer considered along with other assumptions and information in determining the recoverability of the asset. The firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform procedures to test the accuracy and completeness of company-produced data and evaluate the relevance and reliability of certain other data from sources external to the issuer that the company's specialists used to develop the estimate considered by the issuer in determining the recoverability of the asset. (AS 1105.A8a) Financial statement audit only | AS 1105.A8a | Significant risk |
| 9 | Long-Lived Assets | For a third asset the firm's approach to evaluate the recoverability of this asset was to test the issuer's process. The issuer engaged two external specialists to develop an estimate that the issuer considered along with other assumptions and information in determining the recoverability of the asset. The firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform procedures to evaluate whether the methods used by the company's specialists were appropriate under the circumstances. (AS 1105.A8c) Financial statement audit only | AS 1105.A8c | Significant risk |
| 10 | Long-Lived Assets | For a third asset the firm's approach to evaluate the recoverability of this asset was to test the issuer's process. The issuer engaged two external specialists to develop an estimate that the issuer considered along with other assumptions and information in determining the recoverability of the asset. The firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform sufficient procedures to evaluate the relevance and reliability of the work performed by the company's specialists and whether the specialists' findings support or contradict the recoverability of the asset because it did not (1) identify that the report compiled by the company's specialists was a year old and (2) evaluate whether the specialists' findings continued to be relevant and reliable. (AS 1105.A9 and .A10) Financial statement audit only | AS 1105.A10; AS 1105.A9 | Significant risk |
Issuer B11 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Income Statement Account | The firm's approach for testing an income statement account included performing tests of details for a sample of transactions from certain months during the year. The firm did not perform any procedures to test the population of transactions in the remaining months of the year. (AS 2315.24) Financial statement audit only | AS 2315.24 | |
| 2 | Income Statement Account | The firm's approach for testing an income statement account included performing tests of details for a sample of transactions from certain months during the year. The firm did not perform any procedures to test or test controls over the accuracy and completeness of certain data and reports it used to test an income statement account. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 3 | Income Statement Account | The firm performed substantive analytical procedures as part of its testing of an income statement account and used certain external data to develop its expectation. The firm did not evaluate whether the external data used to develop its expectation was sufficiently reliable for purposes of achieving its audit objectives. (AS 2305.16) Financial statement audit only | AS 2305.16 | |
| 4 | Income Statement Account | The firm performed substantive analytical procedures as part of its testing of an income statement account and used certain external data to develop its expectation. The firm did not evaluate differences between its expectation and the actual amounts recorded beyond inquiry of management. (AS 2305.21) Financial statement audit only | AS 2305.21 | |
| 5 | Income Statement Account | The firm did not perform procedures to evaluate whether certain income statement account transactions were recognized in conformity with the applicable accounting standard. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 6 | Balance Sheet Account | The issuer engaged an external valuation specialist to perform an impairment analysis of an asset within a balance sheet account at year end. The firm's approach for substantively testing the fair value of this asset was to test the issuer's process and the firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform sufficient procedures to evaluate the reasonableness of a significant assumption developed by the issuer that the company's specialist used because it did not take into account the issuer's intent and ability to carry out its intended course of action. (AS 2501.16 and .17) Financial statement audit only | AS 2501.16; AS 2501.17 | Significant risk |
| 7 | Balance Sheet Account | The issuer engaged an external valuation specialist to perform an impairment analysis of an asset within a balance sheet account at year end. The firm's approach for substantively testing the fair value of this asset was to test the issuer's process and the firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform any procedures to evaluate the relevance and reliability of external information it used to test the reasonableness of this significant assumption. (AS 1105.04 and .06) Financial statement audit only | AS 1105.4; AS 1105.6 | Significant risk |
| 8 | Balance Sheet Account | The issuer engaged an external valuation specialist to perform an impairment analysis of an asset within a balance sheet account at year end. The firm's approach for substantively testing the fair value of this asset was to test the issuer's process and the firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform procedures to evaluate the relevance and reliability of external information the company's specialist used to develop another significant assumption (AS 1105.A8a) Financial statement audit only | AS 1105.A8a | Significant risk |
| 9 | Balance Sheet Account | The issuer engaged an external valuation specialist to perform an impairment analysis of an asset within a balance sheet account at year end. The firm's approach for substantively testing the fair value of this asset was to test the issuer's process and the firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform procedures to evaluate the relevance and reliability of external information used in its substantive procedures to test the reasonableness of the significant assumption. (AS 1105.04 and .06) Financial statement audit only | AS 1105.4; AS 1105.6 | Significant risk |
| 10 | Balance Sheet Account | The issuer engaged an external valuation specialist to perform an impairment analysis of an asset within a balance sheet account at year end. The firm's approach for substantively testing the fair value of this asset was to test the issuer's process and the firm used the work of the company's specialists as audit evidence. The following deficiency was identified: · The firm did not perform procedures to evaluate the reasonableness of another significant assumption developed by the company's specialist and used in the impairment analysis. (AS 1105.A8b) Financial statement audit only | AS 1105.A8b | Significant risk |
| 11 | Balance Sheet Account | For another asset within the balance sheet account the firm did not perform procedures to evaluate the reasonableness of certain significant assumptions developed and used by the issuer to calculate the amortization for the asset. (AS 2501.16) Financial statement audit only | AS 2501.16 | Significant risk |
Issuer C2 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Income Statement Account | The firm did not perform sufficient procedures to evaluate the appropriateness of the issuer's recognition of certain income statement account transactions because it did not evaluate certain contradictory evidence. (AS 2301.08 and .13; AS 2810.03) Financial statement audit only | AS 2301.8; AS 2301.13; AS 2810.3 | |
| 2 | Balance Sheet Account | The issuer performed an assessment of certain assets within a balance sheet account for impairment at year end and concluded that they were recoverable. The firm did not identify that the issuer did not consider certain indicators of possible impairment in its assessment of these assets. (AS 2301.08 and .11; AS 2810.03) Financial statement audit only | AS 2301.8; AS 2301.11; AS 2810.3 | Significant risk |