the valuation of machinery and equipment assets within the ILS asset group as a critical audit matter because there are significant judgments made by management when determining the fair value of the machinery and equipment assets. This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists, when performing audit procedures to evaluate the reasonableness of the Company’s estimates and assumptions related to asset category selection, fair market value trend factors, assumed physical deterioration, and orderly liquidation value percentages. 

## How the Critical Audit Matter Was Addressed in the Audit 

Our audit procedures included performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included the following, among others: 

• We tested the effectiveness of internal controls over management’s asset group impairment assessment, including those over the asset category selection, fair market value trend factors, assumed physical deterioration, and orderly liquidation value percentages. 

• With the assistance of our fair value specialists, we evaluated the appropriateness of management’s valuation methodologies and the reasonableness of the key assumptions by: 

• testing the source information underlying the determination of the asset category selection, fair market value trend factors, and assumed physical deterioration; and 

• developing a range of independent estimates and comparing the orderly liquidation values selected by management 

/s/ DELOITTE & TOUCHE LLP 

San Jose, California 

December 1, 2020 

We have served as the Company's auditor since 1976. 

