As per your description, the second signature was added physically by printing the document. If the Audit report shows the document as canceled, then the document will not be legally binding. As cancellation means either the sender or the signer has canceled the documentation.
In this case, the sender can upload the document manually to the Adobe Sign once it is signed manually. Then the process will be complete and will not show as the canceled one.
Check if that works for you.
Let us know if you are referring to something else or have any questions.