@BDO USA Tax

@BDO USA TaxBDO ToolsOur TechnologyBDOTechnologyBDO Client PortalUseOnline collection and dissemination tool whereby BDO collects certaininformation from our clients & transfers other documents, results ofanalysis, etc. to our clients. BDO Client Portal is a secure, privatenetwork using internet technology that only authorized individuals canaccess.Benefit to our ClientsThe BDO Client Portal assists in maintaining confidentiality while continuouslyimproving efficiency, coordination, and communication through: Accessibility, regardless of time or location Speed and simplicity of communication Sharing of information and documentationFSI Track, a leading unclaimed property reporting software, will prepare duediligence letters, track responses, prepare escheat report documents andsummaries, report unclaimed property to the appropriate jurisdiction in a timelymanner.FSI TrackUnclaimed Property Reporting and Due Diligence Tracking SoftwareSQL ServerA world-class database information platform to assist in organizing,analyzing unlimited data records to produce summaries and evaluatesolutions/recommendations.BDO’s use of SQL Server technology increases overall project efficiency and enablesfor the analysis of volumes of data as is typical when dealing with companies of thesize and complexities of our clients. our clients can be confident that the number ofrecords produced through the compliance process will not hinder BDO’s ability toanalyze data in a timely and efficient manner.AccessA database tool for gathering and evaluating information.The use of Access will allow BDO to work with our clients personnel in developing adhoc reports to provide updates throughout the engagement and present relevantinformation in a “user friendly” format.MonarchA desktop report mining tool to extract data from report files. Thisallows engagement team to re-use information from existing computerreports, such as text, PDF HTML, and spreadsheet files. The parseddata can be further enhanced with links to external data sources,filters, sorts, calculated fields and summaries.Based on BDO’s experience in dealing with companies of similar size as our clients,accounting records reviewed as part of the process (e.g. bank statements, agingreports, etc.) are usually provided to BDO in various formats. our clients can restassured that BDO has the technological capabilities to convert data from virtuallyany format into a format that is more manageable (e.g. Excel, Access, etc.)Data ExchangeBDO maintains a relationship with a reputable data input company tohelp minimize cost of manually keying data from paper documents intoworkable electronic formats.Our clients will benefit from pre-negotiated bargain rates in the eventdocumentation is only available in a format that requires manual input intocomputer systems. This allows BDO & our clients professionals to focus on morevalue added tasks.BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 21

BDO Unclaimed PropertyCompliance Process

@BDO USA TaxCompliance Process6-Step Process Step 1 - Kick-off meeting, determination of compliance reportingstrategy & payment set-up Step 2 - Compilation of reportable transactions Step 3 - Identification of exemptions/deductions Step 4 - Due diligence notification letters Step 5 - Reconciliation of amounts provided Step 6 - Reporting and remitting funds to the various jurisdictionsBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 23

@BDO USA TaxIdentification of Exemptions/DeductionsExamples of exemptions/deductions that may apply to your companyDe Minimis ExemptionsIndependent ResearchGiftCardExemptionB2BExemptionsUnclaimed Property Reporting SoftwareOther Exemptions/DeductionsBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 24

@BDO USA TaxDue diligence notification lettersOverview of due diligence notification processa) Letters Prepared & Mailedb) ResponsesTracked Viac) Tracking Sheet Providedto Client to Reissue Funds toRespondentsBDO Unclaimed Property Compliance - Due Diligence ResponsesFor Multiple EntityFilingCheck # orProperty Acct # (ifTypeapplicable)BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage meFirstNameMIAddress ired

@BDO USA TaxReporting and remitting funds to the variousjurisdictionsBDO will prepare necessary paper and electronic filings. Most states require a paper reportstate approved cover sheet plus electronic file in specified state required format:NAUPA Format TextFile BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 26

New Developments

@BDO USA TaxWashington S.B. 6057 Beginning July 1, 2016, holders who are required to file a report electronicallywill be required to pay by electronic funds transfer or other form of electronicpayment acceptable to the department. The WA UPD is prohibited from commencing or proceeding with any assessmentmore than 3 years after the due date for payment, including extensions granted. Gift cards that fall within the parameters of WA RCW 19.240 are not reportable. Added: Provisions related to holder reimbursement for over-reporting or items reported inerror.Provisions pertaining to audits including to disclosure of audit information.Amounts paid to WA between 7/1/2015 and 10/31/2016 – P&I will be waived if P&Iapplication waiver is sent with the catch-up filing report. Not applicable for holders currently under audit Refunds or return of property must be done within 6 years after the end ofthe calendar year in which the payment or delivery occurred.BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 28

@BDO USA TaxNew DevelopmentsReportingArkansas H.B. 1782Approved by governor on 4/4/2015. Lowered all five year property dormancy to three years.Effective for Fall 2015 filingMissouri H.B. 1075Approved by governor on 7/9/2014. Lowered all payroll dormancy from five years to three years.Effective 1/1/2015 Provides business to business exemption (deferral) for A/R credits.Effective 7/9/2014BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 29

@BDO USA TaxNew DevelopmentsRisk MitigationTexas – Hires 3rd Parties to Conduct Audits Texas Comptroller of Public Accounts has begun pursuing companies forunremitted unclaimed property using contract auditing firms Many piggy-back audits already begun Companies at most risk include those incorporated in the state of Texas, orcompanies located in other states with significant operations in Texas.New York – 30 Day Final Notice A final notice regarding New York State's increased and focused enforcementefforts relating to unclaimed property is being. Holders who fail to comply with the final 30-day notices are likely to receiveaudit notices from the state. Companies at most risk include those incorporated in the state of New York,or companies located in other states with significant operations in New York.BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 30

@BDO USA TaxDE Law ChangeSenate Bill No.141 Delaware SB 141 was passed on July 1, 2015. This Bill intends to improve the fairnessand help foster compliance with DE’s unclaimed property program through thefollowing:oExtension of DE Voluntary Disclosure Agreement “VDA” ProgramoModification of audit and VDA look-back periodsoRequired annual compliance filing reminder from State EscheatoroReinstatement of interest with a reduced aggregate cap of 25%BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 31

@BDO USA TaxDE Law ChangeSenate Bill No.141 (continued) SB No. 141 extends the Delaware Secretary of State (“DE SOS” or “SOS”) unclaimedproperty VDA program. The bill provides that for periods beginning July 1, 2015 theState Escheator shall not initiate any new unclaimed property audits of companiesunless:oo The company is notified in writing by the DE SOS that it may enter into a VDAprogram and the company does not enter the VDA program within 60 daysfrom the mailing date of the invitation to participate in the VDA program; orA company that has entered into the DE VDA program and has failed to complywith its terms and conditions.1Questions raised?oIs it permanent?oCan I still file VDA with Department of Finance?oWhat if I have a VDA with Department of Finance, can I transfer it to DE SOS?BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 32

@BDO USA TaxDE Law ChangeSenate Bill No.141 (continued) Modification of audit and VDA look-back periodsoThe audit look-back periods are adjusted as follows:#Audit NoticeIssue Period1Pending Examination(audit began prior to7/1/15)1/1/86 – forward(transaction years)This is 5 year reduction off current1981 audit look-back period27/1/15 – 12/31/161/1/91 – forward(transaction years)This is a 10 year reduction offcurrent 1981 audit look-back period1/1/17 and after22 years prior tocalendar year in whicha company is providedwritten notice of theexamination(transactions years)3AuditLook-back PeriodBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 33CommentsFor audits that begin in 2017 this isa 14 year reduction off current auditlook back periods to 1981[1]This is a forward “rolling” 22 yearlook-back period in contrast tocurrent fixed 1981 look-back date

@BDO USA TaxDE Law ChangeSenate Bill No.141 (continued)Modification of audit and VDA look-back periods oThe VDA look-back periods are adjusted as follows:#VDA FilingDate17/1/13 - 9/30/141/1/96 – forward(transaction years)29/30/14 –12/31/161/1/96 – forward(transaction years)31/1/2017 ForwardVDALook-back Period19 years prior to yearDE VDA – 1 Form wasaccepted by DE SOSPaymentDate6/30/2016Within 2 years ofDE SOS fullyWithin 2 years ofDE SOS fullyexecuted DE VDA 1 FormBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 34CommentsThis is a 3 year reduction off current DESOS VDA look-back periods to 1993DE SOS at sole discretion can extenddue date of VDA completion andDE SOS at sole discretion can extenddue date of VDA completion andpayment.This appears to be a forward “rolling”19 year look-back period in contrast tocurrent fixed 1993 or 1996 look-backperiods based on application filing date

@BDO USA TaxDE Law ChangeSenate Bill No.141 (continued) Required annual compliance filing reminder from State Escheatoroo The State Escheator must send a notice 120 days prior to the State’s March 1stunclaimed property report deadline to all those who have filed unclaimedproperty returns in the past five years.Holders must identify in the report a designated employee of the companywho will serve as a contact with the State for all correspondence with thestate related to the reporting and remittance of unclaimed property.Questions Raised?oooDoes this apply at Group level or individual entity level?Is it 5 consecutive years? What if I owed 0 in a given year, and don’t filebecause DE doesn’t require negative reports, do I still get credit for that year?Note to self – watch the mail room!!!!!BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 35

@BDO USA TaxDE Law ChangeSenate Bill No.141 (continued) Reinstatement of interest with a reduced aggregate cap of 25%ooooReinstate the imposition of interest at .5% per month on outstanding unpaidamounts from date the amounts or property is due until paid unless suchfailure is due to reasonable cause.Interest would be capped at 25% of the amount required to be paid andpresumably interest would be imposed on audits and for property reported onannual compliance returns that was reported late.Applies 3/1/16 forwardSmall window to settle audits out prior to then, may escape interestassessment BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 36

@BDO USA TaxDE Law ChangeSenate Bill No.141 (continued) Key points and closing considerations:oooDE law’s continue to change to provide holders with more opportunities to addressunclaimed property matters.Still several areas of uncertainty:—Interest application – automatic or case by case—How is reasonable cause defined and applied—Testing methodology (DE SOS Implementing Guidelines)Most of the above concerns are alleviated via participation into DE SOS VDA program as itwaives Interest and penalty and right to audit (as long as certain conditions are met).—DE VDA period is 2 years; far less when compared to typical audit of 3-7 years—DE VDA allows voids 90 days whereas audit is 30 days—Close out audits or parts of audits prior to 3/1/16; may be able to avoid max25% interest assessment—Many questions raised on notices, responsibilities BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 37

Compliance Best Practices

@BDO USA TaxBest PracticesSelf-Assessment Qualitative Review Does my company have a history of unclaimed property reporting? If so, isproperty being reported or is it just negative reports being filed each year? Where is/was my company incorporated and how far back can that state(s)audit my company for? What is my company’s record retention policy? Does it match up to the UPaudit look back periods? Is there a material amount of checks on my current outstanding A/P checklisting that are older that 3 years? Does my company have a policy of writing off credits or checks simplybecause they have been aged for a specific period of time? Is there a deminimus amount write-off policy (either done manually orautomatically by the system?BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 39

@BDO USA TaxBest PracticesComplianceAn efficient compliance process increases the likelihood that an organizationwill only remit funds rightly due to the states. The compliance process shouldinclude the following, which is most effectively addressed in a compliancemanual: Evaluate company needs/resources regarding unclaimed property Centralize unclaimed property reporting by assigning an unclaimed propertyadministrator Assign liaisons with individual departments to assist in the gathering ofunclaimed amounts (i.e. - accounting, controller, treasury and internallegal). Train staff and management Implement procedures for internal identification of unclaimed property andthe proper tracking, reporting, and payment methods once property isidentified Develop records retention policyBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 40

@BDO USA TaxBest PracticesCompliance (continued)Other key points to consider for the compliance manual: Establish unclaimed property liability account Perform monthly reconciliations and processing of escheat informationconsistent with escheat calendar deadlines (e.g. Cash / A/R accounts) Utilize software or outsource report filing to ensure all new statutorychanges are incorporated into the unclaimed property review Establish compliance calendar to track reporting deadlines and keymilestones (e.g. due diligence) Track legislative changes that impact annual reporting Establish a centralized repository to maintain historical unclaimed propertyfilings (UP reporting software may help here) Review possibilities for mitigation of future unclaimed propertyBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 41

@BDO USA TaxSample TimelineFall 2015 ComplianceKick-offMeetingClientresponseto datarequestApril 15May 15April 1Reissuechecks fromDDLDuediligenceDatarequestValidatedata and IDexemptionsSept 1 –Sept 15July 1 –July 31May 31June 1 –June 30August 30CompileDDLresponsesBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 42Prepare UPreports & checkrequestPreparereconciliationand send toClientReportsto statesOct 15Sept 16 –Oct 7Reportsandchecks toBDONov 15Oct 20Provideelectroniccopies toClient

@BDO USA TaxBest PracticesLegal Considerations Non-Disclosure Agreements Kovel Arrangements Merger & Acquisition review of acquired/divested unclaimed propertyliabilities Re-incorporations in favorable jurisdictionsBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 43

Other BDO Unclaimed PropertyServices

@BDO USA TaxPolicies & ProceduresAR Interview Process Owners Obtain Sample A/R agingAPPayroll Interview ProcessOwners Interview Process Owners GL system review Obtain sample checkregister or outstandingchecklist and voidreports Verify unapplied cashpractices Complete A/Pquestionnaire Verify de minimis writeoff practices GL system review Complete A/Rquestionnaire Identify manual andautomatic writeoffs (ifany) Document A/R process;draft policy andprocedures Setup A/R escheatliability GL account Augment policy andprocedures for escheatbest practices andcompliance timeline Verify stale date andvoid practices Identify manual andautomatic writeoffs (ifany) Document A/P process;draft policy andprocedure Setup A/P escheatliability GL account Augment policy andprocedures for escheatbest practices andcompliance timeline Determine if payroll donein house or outsourced(ADP) Obtain sample checkregister or outstandingchecklist and void reports Complete payrollquestionnaire GL system review Verify stale date and voidpractices Interview ProcessOwners Complete TPA Matrix Obtain TPA PlanDocuments TPA ConfirmationAffidavits GL system review Identify manual andautomatic writeoffs (ifany) Identify manual andautomatic writeoffs (if any) Document TPA process;draft policy andprocedure Document payroll process;draft policy and procedure Setup TPA escheatliability GL account Setup payroll escheatliability GL account Augment policy andprocedures for escheatbest practices andcompliance timeline Augment policy andprocedures for escheat BPsand compliance timelineBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 45TPA

@BDO USA TaxRefund Opportunity Minimal to no risk of audit in non incorporated states Easy way to offset reporting costs with those amounts owed you As many corporate entities report unclaimed property as part of their annualfilings, our process allows us to assist clients in potentially securing their fairshare of what is rightfully owed to them through proprietary “GloStar” systemand related searches.Data nt datato refundSearchesandAnalysisPreparerefundsupport andclaim formsBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 46Submitclaims tostate forpayment to You

@BDO USA TaxAccounting Practices & Control Reviews1. Banking Transactions2. Accounts Receivables3. Third Party Administrator Accounts4. General Ledger Systems and Subsidiary Systems5. Electronic Record Storage and Manual Storage6. Training and Control Implementation7. Automation of Processes8. Data AnalyticsBDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance UpdatePage 47

@BDO USA TaxVoluntary Disclosure/Amnesty ProcessBDO has a developed a pre-approved process to assist clients in entering into the newly established VDAprogram with most state jurisdictions. BDO has worked closely with the state representatives to developpre-approved templates that will be used at every stage in the process and has agreed to methodologies tobe utilized in quantifying exposures for various property types.Step 1File VDAStep 2ScopingFile VDA FormKick-off Meeting with StatePreliminary Document RequestPhase I Templates Bank Acct Listing AP Questionnaire AR Questionnaire Data System Log AR Listing DE Matrix TPA Listing Tax Returns Trial Balance Prior UP ReportsStep 3Data DigDataGathering Manual Records (incl

Aug 11, 2015 · BDO KNOWLEDGE Webinar Series ‒ Unclaimed Property Compliance Update Unclaimed Property Introduction General Information All 50 states and the District of Columbia have enacted unclaimed property laws. The purpose of unclaimed property laws is to ensure the protection of abandoned property until the rightful owner is located.