Company: CPS
Filing Date: 2025-02-14
Form Type: 10-K
Source: 0001320461-25-000033
Chunk: 83

Company: Cooper-Standard Holdings Inc.
Filing Date: 2025-02-14
Form: 10-K
Item: Item 8
Chunk 83
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 assets and liabilities, tax planning strategies that are prudent and feasible, and projections of future taxable income (exclusive of the reversals of existing deferred tax assets and liabilities).During 2024, the Company determined it was more likely than not that the Brazil deferred tax assets are realizable. As a result, the Company released the valuation allowance related to these deferred tax assets of $23 million and recorded a corresponding net income tax benefit. We identified as a critical audit matter management’s determination that the positive evidence of the three-year trend of objective and verifiable taxable income and forecasts of continued taxable income outweighed the negative evidence of historical losses in Brazil and volatility because of the judgment required by management to determine forecasted taxable income. This required a higher degree of auditor judgment and an increased extent of effort, including the need to involve our income tax specialists, when performing audit procedures to evaluate the Company’s assessment.How We Addressed the Matter in Our AuditWe obtained an understanding, evaluated the design, and tested the operating effectiveness of controls relating to the realizability of deferred tax assets. This included controls over management’s projections of future taxable income.To test the realizability of the Company’s deferred tax assets for the Brazil jurisdiction, our audit procedures included evaluating the time period over which temporary differences are expected to reverse, evaluating the assumptions used by the Company to develop projections of future taxable income, and testing the calculations of existing temporary book-tax differences. We evaluated the assumptions used by the Company to develop projections of future taxable income for the Brazil jurisdiction and tested the completeness and accuracy of the underlying data used in its projections. We compared the projections of future taxable income for the Brazil jurisdiction with the actual results of prior periods and considered external data sources and historical trends, to the extent applicable. Our income tax specialists were used to assist in the evaluation of the realizability of the Company’s deferred tax assets for the Brazil jurisdiction, including consideration of applicable tax statutes.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2005.

Detroit, Michigan

February 14, 2025

42

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Cooper-Standard Holdings Inc.

Opinion on Internal Control Over Financial Reporting

We have audited Cooper-Standard Holdings Inc.’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the