- Inspection year
- 2023
- Report date
- 27-Feb-2025
- PCAOB release
- 104-2025-048
- Audits reviewed
- 8
- Audits w/ Part I.A deficiencies
- 6
- Part I.A deficiency rate
- 75%
- Part I.A deficiencies
- 24
- Part I.B deficiencies
- 11
- Report
- View PDF ↗
Deficiencies (24)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A7 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The issuer used a customized application for processing and recording transactions related to revenue. The firm tested the design and operating effectiveness of information technology general controls (ITGCs) and certain automated and IT-dependent manual controls over this application in order to rely on the completeness and accuracy of data and reports produced by the application and used by the firm in its substantive procedures. The following deficiencies were identified: · The firm selected for testing controls over the review and approval of program changes but did not evaluate whether the controls were designed to address the risk that developers have the ability to develop and promote changes to production environments. (AS 2301.19) Financial statement audit only | AS 2301.19 | |
| 2 | Revenue | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The issuer used a customized application for processing and recording transactions related to revenue. The firm tested the design and operating effectiveness of information technology general controls (ITGCs) and certain automated and IT-dependent manual controls over this application in order to rely on the completeness and accuracy of data and reports produced by the application and used by the firm in its substantive procedures. The following deficiencies were identified: · The firm selected for testing controls over change management but did not perform procedures to determine whether the population of changes from which it made its selections for testing represented the complete population of changes made to this application. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 3 | Revenue | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The issuer used a customized application for processing and recording transactions related to revenue. The firm tested the design and operating effectiveness of information technology general controls (ITGCs) and certain automated and IT-dependent manual controls over this application in order to rely on the completeness and accuracy of data and reports produced by the application and used by the firm in its substantive procedures. The following deficiencies were identified: · The firm selected for testing certain automated and IT-dependent manual controls over this revenue. The firm's approach to testing these controls depended on effective ITGCs including controls over change management. As a result of the deficiencies in the firm's testing of the controls discussed above the firm's testing of these automated and IT-dependent manual controls was not sufficient. (AS 2301.18) Financial statement audit only | AS 2301.18 | |
| 4 | Revenue | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The issuer used a customized application for processing and recording transactions related to revenue. The firm tested the design and operating effectiveness of information technology general controls (ITGCs) and certain automated and IT-dependent manual controls over this application in order to rely on the completeness and accuracy of data and reports produced by the application and used by the firm in its substantive procedures. The following deficiencies were identified: · The firm did not identify and test controls that addressed the issuer's evaluation of the reliability of external information used in the operation of certain controls the firm selected for testing. (AS 2301.16) Financial statement audit only | AS 2301.16 | |
| 5 | Revenue | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The firm did not perform procedures to test the issuer's segment reporting disclosures related to revenue beyond obtaining an issuer-prepared schedule. (AS 2301.08) Financial statement audit only | AS 2301.8 | |
| 6 | Digital Assets | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The firm used certain information produced by the issuer's service organization to test digital assets but did not perform procedures that addressed the accuracy and completeness of this data. (AS 2301.08 and .11) Financial statement audit only | AS 2301.8; AS 2301.11 | Significant risk |
| 7 | Digital Assets | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The firm used certain other external information to test digital assets but did not perform procedures to evaluate the reliability of the information beyond obtaining an understanding of the source of the data. (AS 1105.04 and .06) Financial statement audit only | AS 1105.4; AS 1105.6 | Significant risk |
Issuer B3 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The issuer used a customized application for processing and recording transactions related to revenue. The firm tested the design and operating effectiveness of ITGCs and certain automated controls over this application in order to rely on the completeness and accuracy of data and reports produced by the application and used by the firm in its substantive procedures over certain revenue. The firm determined that certain ITGCs were not effective at year end. The following deficiencies were identified: · The firm did not evaluate the severity of the ITGC deficiencies and the effect on its control risk assessment. (AS 2301.34) Financial statement audit only | AS 2301.34 | |
| 2 | Revenue | The issuer used a customized application for processing and recording transactions related to revenue. The firm tested the design and operating effectiveness of ITGCs and certain automated controls over this application in order to rely on the completeness and accuracy of data and reports produced by the application and used by the firm in its substantive procedures over certain revenue. The firm determined that certain ITGCs were not effective at year end. The following deficiencies were identified: · The firm's approach to testing certain automated controls depended on effective ITGCs. As a result of the control deficiencies that the firm identified as discussed above the firm's testing of these automated and IT-dependent manual controls was not sufficient. (AS 2301.18) Financial statement audit only | AS 2301.18 | |
| 3 | Restricted Cash | The firm did not perform procedures to test certain disclosures related to the nature of restrictions for restricted cash beyond reading the issuer's prior year financial statements. (AS 2301.08) Financial statement audit only | AS 2301.8 |
Issuer C4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm selected a sample of transactions to test revenue. The firm did not perform procedures other than reviewing certain information on selected invoices to test whether the delivery of services had occurred prior to the issuer's recognition of revenue for certain sampled transactions. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 2 | Revenue | The firm selected a sample of transactions to test revenue. The firm selected its sample of transactions from three of the four types of revenue. The firm did not perform any procedures to test the fourth type of revenue. (AS 2315.24) Financial statement audit only | AS 2315.24 | |
| 3 | Business Combinations | During the year the issuer acquired a business that resulted in an acquired intangible asset. The firm did not perform any procedures to test or identify and test controls over the accuracy and completeness of issuer-produced data it used to evaluate the reasonableness of a significant assumption. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 4 | Business Combinations | During the year the issuer acquired a business that resulted in an acquired intangible asset. The firm did not identify and evaluate the issuer's omission of certain disclosures related to this business combination that were required by FASB ASC Topic 805 Business Combinations. (AS 2810.30 and .31) Financial statement audit only | AS 2810.30; AS 2810.31 |
Issuer D4 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Business Combinations | During the year the issuer acquired a business and engaged a specialist to determine the fair value of an acquired intangible asset. The following deficiencies were identified: · The firm did not perform sufficient procedures to evaluate the reasonableness of certain significant assumptions developed by the issuer because it limited its procedures to comparing the assumptions to industry information. Further the firm did not perform any procedures to evaluate the reliability of the industry information. (AS 1105.04 and .06; AS 2501.16) Financial statement audit only | AS 1105.4; AS 1105.6; AS 2501.16 | Significant risk |
| 2 | Business Combinations | During the year the issuer acquired a business and engaged a specialist to determine the fair value of an acquired intangible asset. The following deficiencies were identified: · The firm did not perform sufficient procedures to evaluate the reasonableness of another significant assumption developed by the issuer because it limited its procedures to comparing the assumption to industry information without evaluating the significant difference between the assumption and the industry information. Further the firm did not evaluate the reliability of the industry information. (AS 1105.04 and .06; AS 2501.16) Financial statement audit only | AS 1105.4; AS 1105.6; AS 2501.16 | Significant risk |
| 3 | Business Combinations | During the year the issuer acquired a business and engaged a specialist to determine the fair value of an acquired intangible asset. The following deficiencies were identified: · The firm did not perform any procedures to test the accuracy and completeness of certain issuer-produced data used by the company's specialist to develop a significant assumption. (AS 1105.A8a) Financial statement audit only | AS 1105.A8a | Significant risk |
| 4 | Business Combinations | During the year the issuer acquired a business and engaged a specialist to determine the fair value of an acquired intangible asset. The following deficiencies were identified: · The firm did not perform any procedures to evaluate the reliability of industry information it used to evaluate the reasonableness of an assumption developed by the company's specialist. (AS 1105.04 and .06) Financial statement audit only | AS 1105.4; AS 1105.6 | Significant risk |
Issuer E3 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm tested the design and operating effectiveness of certain ITGCs over the issuer's general ledger and other systems in order to rely on the accuracy and completeness of underlying data produced by the issuer that was used in the firm's substantive testing of certain revenue. The firm identified deficiencies in its testing of certain ITGCs. The following deficiencies were identified: · The firm identified compensating controls but did not perform any procedures to test the design and operating effectiveness of those controls during the entire period of reliance. (AS 2301.16) Financial statement audit only | AS 2301.16 | |
| 2 | Revenue | The firm tested the design and operating effectiveness of certain ITGCs over the issuer's general ledger and other systems in order to rely on the accuracy and completeness of underlying data produced by the issuer that was used in the firm's substantive testing of certain revenue. The firm identified deficiencies in its testing of certain ITGCs. The following deficiencies were identified: · The firm selected for testing certain automated and IT-dependent manual controls over this revenue. The firm's approach to testing these controls depended on effective IT general controls (ITGCs). As a result of the deficiency in the firm's testing of the controls discussed above the firm's testing of these automated and IT-dependent manual controls was not sufficient. (AS 2301.18) Financial statement audit only | AS 2301.18 | |
| 3 | Revenue | The firm did not identify and evaluate the issuer's omission of certain disclosures 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 |
Issuer F3 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The issuer's customer determined the amount of consideration for the performance obligations at the time the issuer satisfied its obligations. The firm did not perform procedures to assess whether (1) the issuer's determination of transaction price used to recognize revenue was appropriate and (2) the issuer satisfied its performance obligations prior to the recognition of revenue beyond reading the issuer's revenue recognition memo and confirming with the issuer's customer the payments made to the issuer. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 2 | Revenue | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The firm's substantive procedures to test revenue included substantive analytical procedures. The firm used external data and data derived from the recorded amounts of revenue to develop its expectation. The firm did not evaluate whether the external data was sufficiently reliable for purposes of achieving its audit objective beyond obtaining an understanding of the source of the data. (AS 2305.16) Financial statement audit only | AS 2305.16 | |
| 3 | Revenue | The firm's internal inspection program had inspected this audit and reviewed this area but did not identify the deficiencies below. The firm's substantive procedures to test revenue included substantive analytical procedures. The firm used external data and data derived from the recorded amounts of revenue to develop its expectation. The firm did not evaluate whether the data derived from recorded amounts of revenue was sufficiently relevant and reliable for the purpose of achieving its audit objective. (AS 1105.04 and .06; AS 2305.16) Financial statement audit only | AS 1105.4; AS 1105.6; AS 2305.16 |