- Inspection year
- 2024
- Report date
- 22-May-2025
- PCAOB release
- 104-2025-097
- Audits reviewed
- 3
- Audits w/ Part I.A deficiencies
- 2
- Part I.A deficiency rate
- 67%
- Part I.A deficiencies
- 7
- Part I.B deficiencies
- 4
- Report
- View PDF ↗
Deficiencies (7)
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 | Revenue | To reduce the extent of its substantive procedures for certain revenue the firm tested and placed reliance on controls. The following deficiencies were identified: · The firm selected for testing various automated controls over this revenue that consisted of the configuration of the information technology (IT) system to automatically perform certain functions based on pre-established parameters and the firm used a “test of one” approach to test these controls. The firm's testing of these automated controls using a sample of only one instance of each processing alternative was not sufficient because the firm did not evaluate the system functionality of these controls beyond inquiry of the issuer's personnel regarding their processing alternatives or perform other procedures that would have provided sufficient appropriate audit evidence that these controls were designed and operating effectively. (AS 2301.18) Financial statement audit only | AS 2301.18 | |
| 2 | Revenue | To reduce the extent of its substantive procedures for certain revenue the firm tested and placed reliance on controls. The following deficiencies were identified: · The firm selected for testing an IT dependent manual control over this revenue that consisted of management's review of the reconciliation of certain revenue transactions between two systems. The firm did not identify and test any controls over the accuracy and completeness of the system-generated information used in the operation of this control. (AS 2301.16) Financial statement audit only | AS 2301.16 | |
| 3 | Revenue | To reduce the extent of its substantive procedures for certain revenue the firm tested and placed reliance on controls. The following deficiencies were identified: · The sample sizes the firm used in certain of its substantive procedures to test this revenue were too small to provide sufficient appropriate audit evidence because these procedures were designed based on a level of control reliance that was not supported due to deficiencies in the firm's control testing described above. (AS 2301.16 .18 and .37; AS 2315.19 .23 and .23A) Financial statement audit only | AS 2301.16; AS 2301.18; AS 2301.37; AS 2315.19; AS 2315.23; AS 2315.23A | |
| 4 | Revenue | The firm used reports prepared by a third party to substantively test certain other revenue but did not perform any procedures to evaluate the relevance and reliability of these reports. (AS 1105.04 and .06) Financial statement audit only | AS 1105.4; AS 1105.6 | |
| 5 | Journal Entries | The firm identified a characteristic of potentially fraudulent entries or adjustments for testing but did not determine whether any journal entries met the characteristic. Instead the firm limited its testing of journal entries for this specific characteristic to haphazardly selected journal entries. (AS 2401.61) Financial statement audit only | AS 2401.61 |
Issuer B2 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Accounts Receivable | The firm did not request the confirmation of accounts receivable or document how it overcame the presumption to perform confirmation procedures. (AS 2310.34 and .35) Financial statement audit only | AS 2310.34; AS 2310.35 | |
| 2 | Inventory | The firm did not perform any substantive procedures to test certain inventory. (AS 2301.08) Financial statement audit only | AS 2301.8 |