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BearingPointFctmerly /(/'MG ConsuIIIng

Binder Content Triage Checklist-Tab 1 ETC Screen Shots

I

__ a. Completed Q1 EAC screen shots.

Tab 2 BearingPoint Audit Questionaire (Must have one of the following)

__ a. New engagements: Signed Q1 engagement team Contract Review questionnaire.

__ b. Existing engagements: Signed Q1 engagement team questionnaire update.

.. Tab 3 Copy of C~tractlMSA, amendments and modifications

__ a. All contracts, modifications, and amendments signed/executed in Q1 (January 1,2005 to March 31, 2005) reconciled to summary contract data worksheet inTab 6,

Tab 4 Copy ofQ1 invoices

a. Actual bills sent to the client.

__ b. lTD billing summary (inclusive of invoice number and amount).

Tab 5 BE Combination Template if necessary

__ a. Completed Q1 combination template EAC if applicable.

__ b. Detailed support for additional resources/contingency if necessary.

Tab 6 Summary Contract Data Worksheet.,

Tab 7 3/31 WIPS -

__ a. Be sure that all three WIP sectioJiSlfu-eincluded:

. Tab 1: Professional staff and.o6p revenue.

Tab 2: Subcontractor Revenue.---___ Tab 3: WIP Summary.

" - Tab 8 3/31 support for lTD Adjustments

___ a. Be sure that the following is included:

BearingPolnt, Inc. - Confidential

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....-___ lTD adjustments spreadsheet (ETC adjustment spreadsheet).___ 3/31 Accrual support.___ 3/31 OTL Support.___ 3/31 $1 error support.___ 3/31 T&E support.___ Any other adjustments,

Tab 9 Other

Tab 10 Q4 information (inclusive of all year-end information)

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BearlngPolnt, Inc. - Confidential

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'"contractTypelD Contract Type Description Contract Type Combo

Cost-reimbursement contract that provides for a fee consisting of (a) a base amount (which may be zero) fixed atAF Inception of the contract and (b) an award amount, based upon a judgmental evaluation. CPAF ~ Cost Plus ))ward Fee

Cost-reimbursement contract which dictates required hours by labor category andlor individual that provides for a feeconsisting of (a) a base amount (which may be zero) fixed at inception of the contract and (b) an award amount, based CPAFLE ~ Cost Plus Award Fee

CPAFLE upon a judgmental e Level of EffortCost-reimbursement contract that provides for payment to the contractor of a negotiated fee that is fixed at the inceptionof the contract; the fixed fee does not vary with actual cost, but may be adjusted as a result of changes in the work to

CPFF be performe CPFF ~ Cost Plus Fixed FeeCost-reimbursement contract which dictates required hours by labor category andlor individual that provides forpayment to the contractor of a negotiated fee thm_is fixed at the inception of the contract; the fixed fee does not vary CPFFLE ~ Cost Plus Fixed Fee

CPFFLE with actual cost, but Level of EffortCost-reimbursement contract that provides for an Initially negotiated fee to be adjusted later by a formula based on the

CPIF relationship of total allowable costs to total target costs. CPIF - Cost Plus Incentive FeeCost-reimbursement contract which dictates required hours by labor category andlor Individual that provides for anInitially negotiated fee to be adjusted later by a formula based on the relationship of total allowable costs to total target CPIFLE - Cost Plus Incentive Fee

CPIFLE costs. Level of EffortCost-reimbursement contract in which the contractor receives no fee and is reimbursed only for an agreed-upon portionof its allowable costs; a cost-sharing contract may be used when the contractor agrees to absorb a portion of the costs, CRCS~Cost

CRCS in the expectati ReimbursemenVSharingProvides for receipt of fees for performing a service for which the entire fee or some portion of it will be charged to theclient only if a specific measurable result is obtained, or In which the amount of the fee or a portion of it depends on the

CTGT result CTGT ~ Contingent FeesProvides for a price that is not subject to any adjustment on the basis of the contractOl's cost experience in performing

FFPR the contract. FFPR - Firm Fixed PriceProvides for a price that is not subject to any adjustment on the basis of the contractor's cost experience in performing FFRE ~ Fixed Fees -

FFRE the contract. Reimbursable ExpensesFixed-price contract with award-fee provisions which may be used when the client wishes to motivate a contractor andother Incentives cannot be used because contractor performance cannot be measured objectively.

FPAF FPAF - Fixed Price Award FeeFixed-price contract that provides for adjusting profit and establishing the final contract price by a formula based on the

FPIF relationship of final negotlated total cost to total target cost. FPIF - Fixed Price Incentive FeeRequires (a) the contractor to provide a specified level of effort, over a stated period of time, on work that can be statedonly In general terms, and (b) the client to pay the contractor a fixed dollar amount; which dictates required hours by FPLE ~ Fixed Price - Level of

LE labor cate EffortProvides for (a) a fixed ceiling price, and (b) retroactive price redetermination within the ceiling after completion of the

I contract; It is established at the outset that a fair and reasonable firm fixed price cannot be negotiated and that the FPRR ~ Fixed Price -FPRR amountlnv Redetemnlnable

Such engagements involve providing both consulting services and the alliance partner's hardware/software. In many ofthese situations, BearingPoint is effectively acting as a prime contractor and would therefore typically be entitled to a

LlCF mark-up or commi LlCF ~ Licensing FeesThe preferred contract for each client, for all engagements; to help speed the process and ensure that BearingPolnfsrights are adequately protected, a standard MSA is used which states the temns and conditions and is in a fomn that MSA - Master Services

MSA allows the client to AgreementProvides for the client to manage both up-front and ongoing costs across the life of the project; may include provisionsfor items such as a Help Desk, outsourcing, applications support, and operations support.

MSVC MSVC - Managed ServicesNONS This option is to be used for legal-approved contracts not elsewhere classified. NONS - Non StandardPINK Provides for a good or service to be used as payment, as opposed to cash. PINK - Payment "In Kind"

BeartngPolnt occasionally provides consulting services via a partial cash reimbursement arrangement, with the balanceof fees paid by a capital grant from the client company. This hlgh-risklhlgh-gain scenario needs sufficiently robust

SFEQ assessment technlqu SFEQ - Services for EquityTransaction based pricing Is particularly common in engagements with business start-ups or with businesses that havea unique, high-volume transaction processing system as one of their core competencies. Under this model,

TBFE BearingPolnt can charge an amoun TBFE - Transaction Based FeesProvides for acquiring supplies or services on the basis of (1) direct labor hours at specified fixed hourly rates thatinclude wages, overhead, general and administrative expenses, and profit; and (2) materials at cost, including, If TMAT - Time and Materials - No

TMAT appropriate, materia LimitsProvides for acquiring supplies or services on the basiS of (1) direct labor hours at specified fixed hourly rates thatinclude wages, overhead, general and administratJve expenses, and profit; and (2) materials at cost, including, If

TMCL appropriate, materia TMCL - T&M Not To ExceedProvides for acquiring supplies or services on the basis of (1) direct labor hours at specified fixed hourly rates thatinclude wages, overhead, general and administrative expenses, and profit; and (2) materials at cost, including, If

TMEX appropriate, materia TMEX ~ T&M Ceiling on ExpensesProvides for acquiring supplies or services on the basis of (1) direct labor hours at specified fixed hourly rates thatinclude wages, overhead, general and administrative expenses, and profit; and (2) materials at cost, Including, If

FE appropriate, materia TMFE - T&M Ceiling on Fees'1 Provides for acquiring supplies or services on the basis of (1) direct labor hours at specified fixed hourly rates that

"'TMWF

include wages, overhead, general and administrative expenses, and profit; and (2) materials at cost, including, If TMWF ~ T&M With Fixedapproprtate, materia Components

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BP - Contract Combination Template - June 03 2005 ~

UNBILLED AIR RECALCULATION PROCEDURES: ....-7"\:

This analysis should be done by project #. If you cannot obtain invoice information byproject #, just complete the totals column for the ITO billings (override formulas) section.

1. Obtain ITO revenues from 3/31/05 Contract Summary, or from WlP's.

2. Obtain ITO billings amount from invoice summary.

3. Reduce your ITO billings for any invoices sent to client after 3/31/05 in orderto arrive at an actual invoiced amount as of 3/31/05.

4. In order to test the reasonableness of the recalculated unbilled balance,obtain copies of invoices issued after 3/31/05 for work performed through3/31/05.

6. Test reasonableness of Recalculated Unbilled Balance and provide an explanation:Your recalculated unbilled balance should make sense based on subsequent billingsor other factor~ such as the billing arrangements on the job.

For cost type contracts (e.g., T&M) and completed fixed price contracts,attempt to prove out your unbilled AIR balance by billings subsequent to3/31/05 that relate to services provided by Bearing Point prior to 3/31/05.Your unbilled balance should come reasonably close to the subsequentbillings.

For ongoing fixed price contracts, there may not be a correlation betweenyour unbilled balance and subsequent billings. However, you shouldreview subsequent billings and understand why the unbilled balance at3/31/05 may not correlate to subsequent billings. This will be a matter ofunderstanding the billing arrangements on the contract.

If you have a negative unbilled balance, make sure that this appears reasonable basedon factors such as the project bills the client in advance.

Do not spend too much time trying to explain the recalculated unbilled balance.Please check with your audit review team lead for guidance.

Client Contract #Contract Name:CONIProject#'sManaging DirectorContract TypeSubcontractors? (Yes or No)Was a manual ETC preparad?

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Revenue Summary

Labor RevenueBinder Ref

OOP Revenue

Subcontractor Rev

Total WlP Revenue t"'~' ~-, ~~-.,..... j... ~~

ITO Adjustments

Subcontractor accrual adjustmentsSubcontractor correctionsOTL AdjustmentsT&E AdjustmentsOther Adjustmenb

Binder Ref

Total Adjustment to WlP

Implied ETC Adjustment - (Discount)lPramlum Based on this UpdateCurrent Period ETC (Dlscount)lPramium

Total Adjusted WlP Revenue Ij'M~~I ~E~RP~C~h~e~Ck~~~~ ~ ~

Rate BasedRecorded Amounts

Revenue at Standard Bill RatesRevenue at Client Bill RatesERP%

ETC EAC

Initial Original Planned ERP % (Input as O.l<X)Var1ance (must be zero)

, _ __~ ~ ~ ._H~,,~, - ••• - ;j, ~ _1l

'_~~::iLi:I,:l: ~: ~ ~1RRG ~~~~1:- "';.~)~:lr,,:'"_'~]

Revenue I Cost Check

OOP

PER WIPS PERWlp5Total Costs at Client Total Revenue at

Bill Rates Client Bill RatesVartance

(must b. zero)

Subcontractor

Ongoing FFPR·FFRE

a.artngPoint~. Review ChecklISt

cu..- Name (Bill To)

oa.Slgned

New Contract

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Governing Documents

Confidential

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Modlllcation 0o

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GSA 0MSA 0SOW 0Proposal 0Olher 0

Other Umbrella 0BPA 0TO 0~pec' CI PO 0

Project Detail (check)

This contract meets combination criteria with the following contracts:

o ConsuHo Custorrizeo Design, build or modify complex equipment or softwareo Designo Maintaino Hosto .Hardwareo 3rd party sofIware(perpetuallicense),o 3rd party sofIware(tenn license),o BE software(perpetuailicense),o BE softwa(e(term license),

o Developo Instano Staff Augmento Implemento Treln'o RunlManaged Serviceso Hardware (maintenance on hardware)o 3rd party (maintenance on perpetual license)o 3rd party (maintenance on term license)o BE Software (maintenance on perpetual Jicense)o BE Software (maintenance on term license)o Other •

funded Value·CurrentFunded Valu.· Cumulative _Contract Value

Other:

,......._)

One GloM Detail;................. -)

Payment TermsPeriod of Perfonnance

Are payment terms > 60 days?Are there cancellation prlylleges allowing a refund of revenue?Is there a fiscal funding clause?

If yes, Is the ftkellhood of cancellation remote?Does this engagement eontaln hosting?Does this. engagement contain Incentives or award fees?Are there any contingencies?Are there any rebates?Are there any discounts on Mure products or services?Does this engagement Include leasing?Will any free work be done on this engagement?Does this eoIgageIIl8Ilt Include transaction fees?Are there any side letters or verIlal commitments?Are there any performance-based penalties?Will there be retalnage or holdbacks on this engagement?Is BE acting as a,subcontractor?Is BE utilizing subcontractorsIs an ERP of less than 30% forecasted?Will there be a loss on this engagement?

Have you been In\'Olclng In a timely way?

Will BE collect Ina timely way?

Does this contract Include acceptance?

If yes, Is " 0 perfunctory 0 to published license specs

o- ONo- ONo- ONDy ONc- CJH.o- ONo- ONo- ONo- ONo- ONo- ONo- ONo- ONo- ONn- ONo- ONo- ONo- ONo- ONo- ONn- ONo- ONo to BE standard acceptance o to BE ~ted speco to customer spec

CON #Project #Contract Type

Does uncerlalnly extst regarding acceptance? 0YONDoes this engagement have Type 1 or Type 2 subsequent event? Ust, If 80 0 YONDoes this engagement require II SAD 99 adjustment? 0 YON

CON'Project #Contract Type

Set Up (check):Price Type 0RecognIUon 0Bill Type 0

Rate-Based 0 Amount-SasedAs incurred 0 Milestone/Amount liasedAs Incunred 0 Milestone/Amount Based 0 Value Based

0 1040 97·2 ·000-21 0 Other:---

lData:

Data:

Data:

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Applicable LJtarature (check 1n~1 ...... ment) 081.1

CClll'llMntaII •• unIFoliowUpIConclu.lon:

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B objectlvesubjective

ct1ec:IdIst T~te1.

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Customer Name (Bill To) Should reasonably match the name on the binder

Date SignedlEffective: The date the Contract was signed; if effective on another date,please indicate-

New or Modification Is the engagement a modification of a previous contract? May beboth; will usually be at least "new."

Project Description Short description of the kind of work BE is performingGoverning Documents The types of contract documents governing the engagement; e.g.

MSA + TO's, etc.Contract Difficulty This should be filled out by the person who fills out the

"Applicable Literature" and "One Globe Detail- Set Up" boxes(see below). If the conclusions reached on those items are opento further interpretation, the "Yes" box should be checked.

Combination Criteria Accounting guidance permits combining contracts that meetcertain criteria. If there are other CON's with the same client

-- made at about the same time for related work, or if a singlecontract was subdivided for administrative purposes, combinationcriteria may be met. Probably need the project team's input onthis one.

Project Detail: Systems implementation jobs are accounted for differently thannon-technical advisory jobs. These details help us make thedistinction, so please check all that apply.

Funded Value/Contract If contract is incrementally funded indicate the Funded Values toValue date. If Funded Value is the same as Contract Value, please

explicitly indicate.Payment Terms How fast the client will pay our invoices (e.g. "30 days"). Often

in the MSA or general terms and conditionsPeriod of Performance From and To datesOther: Payment terms .... Should be consistent with the payment terms entry just aboveOther: cancellation ... Check the cancellation or termination language in the contract(s)

to see if refunds of BE fees are to be made when contracts areterminated.

Other: fiscal funding ... A clause in a contract that says that, if funds for the contract arenot approved (e.g. by a legislature), the contract may be cancelled

Other: hosting Will BE be hosting systems on an ongoing basis for the client?Other: incentives Can BE's receipts be adjusted based on performance? Sometimes

noted in the TO's, sometimes in the SOWs; Engagement teamsare usually aware ofthese.

Other: contingencies Are BE's receipts from the engagement contingent upon other,outside conditions? Should be in the contract documents.

Other: rebates As for the above, are rebates permitted under certain conditions(volume, etc.). Should be noted in the contract documents.

Other: discounts Should be noted in the contract documents.Other: leasing Is BE leasing any hardware/software to the client?Other: free work May appear in correspondence or in the contract documents.Other: transaction fees Transaction fees generated over time from transactions executed

on systems delivered by BE

....-Revenue Review Checklist Completion instructions .~

Confidential Page 1 6/29/2005

Other: side letters or verbal Need the engagement teamIMD to vouch for tWs ;

commitmentsOther: performance-based Should be in the contract documents. Usually associated withpenalties late delivery.Other: retain age or Amounts the client "holds back" from paying BE until someholdbacks condition is met (e.g. signoffs or waivers are signed). These

'should be spelled out in 'the contract documents.Other: BE acting as a Should be in the contract documents and/or questionnairesubcontractorOther: BE utilizing Should be in the contract documents and/or questionnairesubcontractorsOther ERP <30% Project ERP estimated and actuals appear in the "ETC Analysis"

view under Tab 1 in the binders.Other: will there be a loss? MD or team question; possibly in the contract questionnaireOther: invoicing timely Not-timely invoicing should be noted by the teamIMD; may be

discemable by comparing the invoices in the binder with thebilling schedule/terms

Other: collect timely ... As for invoicing, should be noted by the team, else may be- discemable from the binder documents.

Other: Does this contract Acceptance means the client acknowledges that we deserve to beinclude acceptance? paid. There's usually general language in the umbrella contracts,

and sometimes in the task-level agreements.(Acceptance, con't): Ifyes, Evaluate the acceptance criteria from the contract:is it ... - Perfunctory: client won't question that product is acceptable

- To published license specs- To BE standard acceptance (standard BE language is

employed)- To BE created spec (BE specifies the acceptance criteria)- To customer spec (client specifies the criteria)- Objective (fixed, measurable criteria)- Subjective ("good enough" according to some evaluation)

Does uncertainty exist Is there a meaningful chance that a client will not eventually findregarding acceptance? our work acceptable enough to award us our fees?Does this engagement have Have subsequent events transpired that require adjustingType 1 or Type 2 subsequent accounting entries to be made? BE has specific guidance on this,event? and you'll probably need to defer either to your team lead or

project team for this.Does this engagement If small, non-material adjustments across reporting periodsrequire a SAB 99 accumulate to the point of being material, a SAB 99 adjustmentadjustment? may be required. Another item for your team lead or the project

teamOne Globe Detail CON #, Project # from the binder. Contract Type refers to fixed-

fee, T&M, etc. There are specific One Globe codes for this (seeattached table).

One Globe Detail Set Up Probably best determined by a BE person with some One Globeknow-how

Applicable literature The accounting literature that applies to this engagement. If youaren't familiar with these don't guess; ask your team lead toevaluate.

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Confidential Page 2 6/29/2005

Contract Type Table

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Please select from this list of Contract Types when completing the "One Globe Detail- ContractType" section. (Shading added to improve readability)

Confidential Page 3 6/29/2005