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PricewaterhouseCoopers Auditores Independentes Ltda.
Brazil · PricewaterhouseCoopers International Limited · Triennially Inspected
- Inspection year
- 2023
- Report date
- 12-Sep-2024
- PCAOB release
- 104-2024-144
- Audits reviewed
- 3
- Audits w/ Part I.A deficiencies
- 3
- Part I.A deficiency rate
- 100%
- Part I.A deficiencies
- 13
- Part I.B deficiencies
- 1
- Report
- View PDF ↗
Deficiencies (13)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A9 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm selected for testing a control that consisted of management's review and approval of certain studies performed to assess the reasonableness of the assumptions used by the issuer to determine a quantitative reserve component of the ACL. The firm did not evaluate the review procedures that the control owner performed including the procedures to identify items for follow up and the procedures to determine whether those items were appropriately resolved. (AS 2201.42 and .44) Both financial statement and ICFR audits | AS 2201.42; AS 2201.44 | Significant risk |
| 2 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm selected for testing two controls that consisted of management's review and approval of the models used by the issuer and the issuer's calculation of a complementary reserve component of the ACL. The firm did not evaluate the specific review procedures that the control owner performed to evaluate the reasonableness of a post-model adjustment included in this component of the ACL. (AS 2201.42 and .44) Both financial statement and ICFR audits | AS 2201.42; AS 2201.44 | Significant risk |
| 3 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm selected for testing a control that consisted of management's monitoring of customers' financial condition through the use of a color-coded monitoring system to identify economic groups that experienced a decline in credit quality. The firm did not identify and test any controls over the accuracy and completeness of the data used in the operation of this control. (AS 2201.39) Both financial statement and ICFR audits | AS 2201.39 | Significant risk |
| 4 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm selected for testing a control that consisted of management's monitoring of customers' financial condition through the use of a color-coded monitoring system to identify economic groups that experienced a decline in credit quality. The firm did not evaluate the specific review procedures that the control owner performed to identify economic groups which experienced a decline in credit quality. (AS 2201.42 and .44) Both financial statement and ICFR audits | AS 2201.42; AS 2201.44 | Significant risk |
| 5 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm selected for testing a control that consisted of management's review and approval of the economic risk ratings used by the issuer to determine the quantitative component of the ACL. The firm did not evaluate the specific review procedures that the control owner performed to assess the reasonableness of these economic risk ratings. (AS 2201.42 and .44) Both financial statement and ICFR audits | AS 2201.42; AS 2201.44 | Significant risk |
| 6 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm did not identify and test any controls over the valuation of assets collateralizing certain loans. (AS 2201.39) Both financial statement and ICFR audits | AS 2201.39 | Significant risk |
| 7 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm did not evaluate whether the method used by the issuer in certain models to determine a complementary reserve component of the ACL was in conformity with the requirements of IFRS. (AS 2501.10) Both financial statement and ICFR audits | AS 2501.10 | Significant risk |
| 8 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm did not evaluate the reasonableness of the significant assumptions used by the issuer in these models. (AS 2501.16) Both financial statement and ICFR audits | AS 2501.16 | Significant risk |
| 9 | Allowance for Credit/Loan Losses | The issuer's ACL was comprised of various components including quantitative and complementary reserve components and the issuer used various models and assumptions to determine the individual components of the ACL. The firm's approach for substantively testing the ACL was to test the issuer's process. The following deficiency was identified: · The firm did not perform procedures to evaluate the reasonableness of certain significant assumptions used by the issuer to determine the quantitative component of the ACL beyond for one such assumption consisting of loan risk ratings testing the mathematical accuracy of certain inputs for a sample of the issuer's risk rating models. (AS 2501.16) Both financial statement and ICFR audits | AS 2501.16 | Significant risk |
Issuer B3 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm selected for testing two controls over revenue that consisted of (1) management's review of information related to order entry shipping invoicing and accounts receivable and (2) the issuer's performance of a gross to net revenue analysis. The firm did not identify and test any controls over the accuracy and completeness of certain reports used in the operation of these controls. (AS 2201.39) Both financial statement and ICFR audits | AS 2201.39 | |
| 2 | Revenue | The firm selected for testing two controls over revenue that consisted of (1) management's review of information related to order entry shipping invoicing and accounts receivable and (2) the issuer's performance of a gross to net revenue analysis. The firm did not evaluate the review procedures that the control owners performed including the procedures to identify items for follow up and the procedures to determine whether those items were appropriately resolved. (AS 2201.42 and .44) Both financial statement and ICFR audits | AS 2201.42; AS 2201.44 | |
| 3 | Inventory | The firm selected for testing a control over inventory that consisted of management's review of standard versus actual costs used by the issuer to record inventory. The firm did not identify and test any controls over the accuracy and completeness of a report used in the operation of this control. (AS 2201.39) Both financial statement and ICFR audits | AS 2201.39 |
Issuer C1 deficiency
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Allowance for Doubtful Accounts | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiency below. The firm selected for testing a control over accounts receivable that consisted of management's review and approval of the allowance for doubtful accounts. The firm did not identify and test any controls over the accuracy and completeness of certain system-generated data used in the operation of this control. (AS 2201.39) ICFR audit only | AS 2201.39 |