- Inspection year
- 2023
- Report date
- 27-Sep-2024
- PCAOB release
- 104-2024-159
- Audits reviewed
- 2
- Audits w/ Part I.A deficiencies
- 2
- Part I.A deficiency rate
- 100%
- Part I.A deficiencies
- 11
- Part I.B deficiencies
- 6
- Report
- View PDF ↗
Deficiencies (11)
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 | Revenue | The firm's approach for testing one type of revenue included performing tests of details for a sample of transactions from one day during the year. The firm did not perform any procedures to test the population of transactions in the remaining days of the year. (AS 2315.24) Financial statement audit only | AS 2315.24 | |
| 2 | Revenue | The firm's approach for testing one type of revenue included performing tests of details for a sample of transactions from one day during the year. The firm did not perform sufficient procedures to test the transaction price for the sample of transactions because it limited its procedures to testing that the issuer received certain cash. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 3 | Revenue | The firm's approach for testing a second type of revenue included performing tests of details for a sample of transactions. The firm identified differences in its testing for certain transactions. The firm did not (1) consider the nature and cause of the differences; (2) project the differences to the remaining revenue population; and (3) evaluate the results and take appropriate action. (AS 2315.26 .27 and .28) Financial statement audit only | AS 2315.26; AS 2315.27; AS 2315.28 | |
| 4 | Revenue | The firm did not perform any substantive procedures to test a third type of revenue. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 5 | Accounts Receivable | The firm's approach for substantively testing the allowance for doubtful accounts was to develop an independent expectation. The following deficiency was identified: · The firm did not perform procedures to test or test controls over the accuracy of certain data it used to develop its independent expectation. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 6 | Accounts Receivable | The firm's approach for substantively testing the allowance for doubtful accounts was to develop an independent expectation. The following deficiency was identified: · The firm did not perform any procedures to demonstrate it had a reasonable basis for certain assumptions it developed and used in determining its independent expectation. (AS 2501.22) Financial statement audit only | AS 2501.22 | |
| 7 | Accounts Receivable | The firm's approach for substantively testing the allowance for doubtful accounts was to develop an independent expectation. The following deficiency was identified: · The firm did not compare its independent expectation to the issuer's recorded allowance for doubtful accounts and evaluate the difference. (AS 2501.26; AS 2810.13) Financial statement audit only | AS 2501.26; AS 2810.13 | |
| 8 | Cash and Cash Equivalents | The firm sent positive confirmation requests for cash and cash equivalents balances and used an external party to receive the confirmation responses. The firm did not maintain control of the confirmation responses through direct communication with the intended recipients of the confirmation requests. (AS 2310.28) Financial statement audit only | AS 2310.28 | Significant risk |
| 9 | Journal Entries | The firm identified fraud criteria for journal entries and obtained a listing of all journal entries that met the criteria. The firm did not perform sufficient substantive procedures to test those journal entries because it limited its procedures to certain journal entries without having an appropriate rationale for limiting its testing to those journal entries. (AS 2401.61) Financial statement audit only | AS 2401.61 |
Issuer B2 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm did not perform procedures to test or test controls over the accuracy of certain system-generated data that it used to test certain revenue. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 2 | Journal Entries | The firm identified fraud criteria for journal entries and obtained a listing of all journal entries that met the criteria. The firm did not perform sufficient substantive procedures to test those journal entries because it limited its procedures to certain journal entries without having an appropriate rationale for limiting its testing to those journal entries. (AS 2401.61) Financial statement audit only | AS 2401.61 |