Editas Medicine Inc
For the period ended Dec 31, 2024. Filed Mar 5, 2025.
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FY2024 · Filed Mar 5, 2025
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Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of Editas Medicine, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Editas Medicine, Inc. (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive loss, stockholders’ equity and cash flows for each of the three years in the period ended December 31, 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 December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.
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 Public Company Accounting Oversight Board (United States) (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. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.
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.
| Accrued Research and Development Expenses | |
| Description of the Matter | The Company’s accrued research and development expenses totaled $13.3 million at December 31, 2024, which includes accrued clinical trial expenses. As discussed in Note 2 to the consolidated financial statements, the Company expenses research and development costs as incurred. The Company accrues expenses related to clinical trials based on estimates of the services performed pursuant to their contractual arrangements, including those with clinical research organizations. Payments under these contracts may depend on factors such as the successful enrollment of patients and the completion of clinical milestones and may differ from the level of effort expended in each period. |
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| How We Addressed the Matter in Our Audit | Auditing the Company’s accrued research and development expenses was complex in the context of this audit due to the volume of research and development activity and the reliance on third-party vendors. That is, due to the timing and pattern of invoices received from third parties, actual amounts incurred were not always known as of the audit report date. To test the accrued research and development expenses related to clinical trials, our audit procedures included, among others, obtaining an understanding of the Company’s process, testing the accuracy and completeness of the underlying data used in the estimates and evaluating and testing the significant assumptions that are used by management to estimate the accruals. To test the significant assumptions, we inspected the contracts and any amendments to the contracts with third-party service providers, and corroborated the progress of research and development projects with the Company’s research and development personnel that oversee the clinical trials. We also obtained evidence from the Company’s clinical research organization, including the number of patients, sites, purchase order amounts and total amounts invoiced to date. To further evaluate completeness, we tested invoices and payments to third parties subsequent to year-end. |
/s/Ernst & Young LLP
We have served as the Company’s auditor since 2015.
Boston, Massachusetts
March 5, 2025
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