MAXIMUS INC
For the period ended Sep 30, 2024. Filed Nov 21, 2024.
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FY2024 · Filed Nov 21, 2024
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Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Maximus, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Maximus, Inc. (the Company) as of September 30, 2024 and 2023, the related consolidated statements of operations, comprehensive income, changes in shareholders' equity and cash flows for each of the three years in the period ended September 30, 2024, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at September 30, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended September 30, 2024, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of September 30, 2024, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated November 21, 2024 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
| Revenue recognition – Measuring Variable Consideration in Certain Performance-based Revenue Contracts | |
| Description of the Matter | As described in Note 2 and Note 4 to the consolidated financial statements, for certain performance-based contracts, the Company constrains revenue due to penalties and incentives on performance criteria defined in each contract. For the year-ended September 30, 2024, the Company recognized revenue related to performance-based contracts of $2.94 billion. Revenue recognition for some of these contracts involves estimation of variable consideration utilizing management’s judgments about achieving the performance criteria. Auditing the Company's measurement of variable consideration for these performance-based contracts requires judgment because the calculation to determine the constraint requires the evaluation of both objective and subjective criteria, which may require the use of estimates. |
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| How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s process to calculate the variable consideration, including determining the objective and subjective criteria defined in the contract. To test the variable consideration, our audit procedures included, among others, evaluating the judgments used in management’s calculation of variable consideration. For example, we prepared a trend analysis to evaluate the achievement of the subjective criteria and compared the result to management’s estimate. |
/s/ Ernst & Young LLP
We have served as the Company's auditor since 1996.
Tysons, Virginia
November 21, 2024
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