- Inspection year
- 2025
- Report date
- 20-Nov-2025
- PCAOB release
- 104-2026-013
- Audits reviewed
- 2
- Audits w/ Part I.A deficiencies
- 1
- Part I.A deficiency rate
- 50%
- Part I.A deficiencies
- 14
- Part I.B deficiencies
- 2
- Report
- View PDF ↗
Deficiencies (14)
Grouped by issuer and in the same order as the PCAOB report, so each item ties back directly to the source.
Issuer A14 deficiencies
| # | Area | Deficiency | Standard | Flags |
|---|---|---|---|---|
| 1 | Revenue | Certain of the issuer's revenue arrangements included multiple performance obligations. The issuer recognized revenue from certain contracts as either single performance obligations or multiple performance obligations satisfied at a point in time. The firm's substantive procedures to test revenue consisted of selecting a sample of transactions for testing. The following deficiency was identified: • The firm did not perform any substantive procedures to evaluate the issuer's contract terms with its customers to determine whether the issuer recognized revenue in conformity with FASB ASC Topic 606 Revenues from Contracts with Customers. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 2 | Revenue | Certain of the issuer's revenue arrangements included multiple performance obligations. The issuer recognized revenue from certain contracts as either single performance obligations or multiple performance obligations satisfied at a point in time. The firm's substantive procedures to test revenue consisted of selecting a sample of transactions for testing. The following deficiency was identified: • The firm did not sufficiently evaluate the issuer's identification of performance obligations because it did not evaluate (1) the issuer's basis for concluding that the goods or services or bundles thereof represented single or multiple performance obligations including any ‘series' performance obligations; and (2) whether any performance obligations met the criteria for recognition over time. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 3 | Revenue | Certain of the issuer's revenue arrangements included multiple performance obligations. The issuer recognized revenue from certain contracts as either single performance obligations or multiple performance obligations satisfied at a point in time. The firm's substantive procedures to test revenue consisted of selecting a sample of transactions for testing. The following deficiency was identified: • The firm did not perform any procedures to test whether performance obligations had been satisfied before revenue was recognized for all but four transactions selected for testing. (AS 2301.08 and .13) For two of these transactions the firm did not test or test any controls over the completeness and accuracy of issuer-produced information used in its substantive testing. (AS 1105.10) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 4 | Revenue | Certain of the issuer's revenue arrangements included multiple performance obligations. The issuer recognized revenue from certain contracts as either single performance obligations or multiple performance obligations satisfied at a point in time. The firm's substantive procedures to test revenue consisted of selecting a sample of transactions for testing. The following deficiency was identified: • The firm did not perform any procedures to test whether performance obligations had been satisfied before revenue was recognized for all but four transactions selected for testing. (AS 2301.08 and .13) For two of these transactions the firm did not test or test any controls over the completeness and accuracy of issuer-produced information used in its substantive testing. (AS 1105.10) Financial statement audit only | AS 1105.10 | |
| 5 | Revenue | Certain of the issuer's revenue arrangements included multiple performance obligations. The issuer recognized revenue from certain contracts as either single performance obligations or multiple performance obligations satisfied at a point in time. The firm's substantive procedures to test revenue consisted of selecting a sample of transactions for testing. The following deficiency was identified: • The firm's sample was too small to provide sufficient appropriate audit evidence because the firm did not take into account the relevant factors in determining its sample size including tolerable misstatement for the population the allowance for incorrect acceptance and the characteristics of the population. (AS 2315.16 .19 .23 and .23A) Financial statement audit only | AS 2315.16; AS 2315.19; AS 2315.23; AS 2315.23A | |
| 6 | Revenue | The firm did not evaluate whether the issuer's accounting for certain revenue as the principal rather than as an agent was appropriate. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 7 | Accounts Receivable | The firm's approach to testing accounts receivable included sending a positive confirmation request to the issuer's largest customer. The firm sent the confirmation request to a respondent who was an employee of the issuer who also performed contract work for the customer without considering the respondent's objectivity and freedom from bias and whether the response that was received by the firm provided meaningful and appropriate evidence. (AS 2310.26 and .27) Financial statement audit only | AS 2310.26; AS 2310.27 | |
| 8 | Accounts Receivable | The firm also traced one invoice due from another customer to subsequent cash receipts. The firm did not perform any procedures to test the remaining accounts receivable balance. (AS 2301.08 and .13) Financial statement audit only | AS 2301.8; AS 2301.13 | |
| 9 | Significant Assets | During the year events or changes in circumstances existed indicating that the carrying value of the significant assets may not be recoverable. The firm did not evaluate whether the issuer performed an assessment of these assets for possible impairment. (AS 2301.08; AS 2810.03) Financial statement audit only | AS 2301.8; AS 2810.3 | Significant risk |
| 10 | Significant Assets | The issuer developed an estimate related to certain other of these significant assets. The firm's approach for substantively testing this estimate was to test the issuer's process. The following deficiency was identified: • The firm did not perform any procedures beyond inquiry to evaluate the appropriateness of the issuer's classification of certain significant assets. (AS 2301.08 and .11) Financial statement audit only | AS 2301.8; AS 2301.11 | Significant risk |
| 11 | Significant Assets | The issuer developed an estimate related to certain other of these significant assets. The firm's approach for substantively testing this estimate was to test the issuer's process. The following deficiency was identified: • The firm did not sufficiently evaluate whether the issuer's method used to determine an estimate related to the significant assets was in conformity with GAAP because it did not evaluate whether the method considered a certain significant assumption. (AS 2501.10) Financial statement audit only | AS 2501.10 | Significant risk |
| 12 | Significant Assets | The issuer developed an estimate related to certain other of these significant assets. The firm's approach for substantively testing this estimate was to test the issuer's process. The following deficiency was identified: • The firm did not evaluate whether the issuer had a reasonable basis for using a certain significant assumption used to develop an estimate related to the significant assets. (AS 2501.16) Financial statement audit only | AS 2501.16 | Significant risk |
| 13 | Significant Assets | The issuer developed an estimate related to certain other of these significant assets. The firm's approach for substantively testing this estimate was to test the issuer's process. The following deficiency was identified: • The firm did not test or test any controls over the accuracy and completeness of certain data used to determine the estimate. (AS 1105.10) Financial statement audit only | AS 1105.10 | Significant risk |
| 14 | Journal Entries | To identify and select journal entries for testing the firm identified fraud characteristics and obtained a list of all journal entries with these characteristics. The firm did not perform sufficient procedures to test those journal entries because it examined the underlying support for only certain of the journal entries without having an appropriate rationale for limiting its testing to those certain journal entries. (AS 2401.61) Financial statement audit only | AS 2401.61 |