While I'm not a FFL, I am an avid collector and know several...
#1 Almost every audit comes up with some i not dotted or t not crossed. Even the most anal of FFL record keepers generally get some bump on an audit. The old quote "give an auditor enough time..."
#2 The FFLs records are being cross checked from the manufacturer, through the wholesaler to his own multiple sets of records (log, incoming transfer form, 4473 outgoing transfer forms, etc.). If anyone in the chain of custody has made a mistake on name, address, serial number, model number, make or anything, the FFL is cited with a warning minimum.
#3 The audit in question went back 30 years! AND the ATF did not allow the FFL holder to be present as is usual and he could not correct or explain or contest any of their findings. He was not allowed to review what their determinations were. HIGHLY unusual in an audit.
Apparently this operation is exceptionally incompetent/criminal to be singled out in such a manner.