James L. Nicholson, Jr., CPA G. Kenneth Pavy, II, CPA Michael A. Roy, CPA Lisa Trouille Manuel, CPA Dana D. Quebedeaux, CPA

Van L. Auld, CPA

February 6, 2018

JOHN S. DOWLING & COMPANY A CORPORATION OF CERTIFIED PUBLIC ACCOUNTANTS

www.jsdc-cpas.com

Report on the Firm's System of Quality Control

John S. Dowling, CPA 1904-1984

John Newton Stout, CPA 1936-2005

Chizal S. Fontenot, CPA 1955-2012

Retired

Harold Dupre, CPA 1996

Dwight Ledoux, CPA 1998

Joel Lanclos, Jr., CPA 2003

Russell J. Stelly, CPA 2005

To the Shareholders ofT.S. Kearns & Co, CPA, P.C. and the Peer Review Committee of the Louisiana Society of CPA's

We have reviewed the system of quality control for the accounting and auditing practice of T.S. Kearns & Co, CPA, P.C. (the firm) in effect for the year ended August 31, 2017. Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Peer Review Board of the American Institute of Certified Public Accountants (Standards).

A summary of the nature, objectives, scope, limitations of, and the procedures performed in a System Review as described in the Standards may be found at www.aicpa.org/prsummary. The summary also includes an explanation of how engagements identified as not performed or reported in conformity with applicable professional standards, if any, are evaluated by a peer reviewer to determine a peer review rating.

Firm's Responsibility

The firm is responsible for designing a system of quality control and complying with it to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported in conformity with professional standards, when appropriate, and for remediating weaknesses in its system of quality control, if any.

Peer Reviewer's Responsibility

Our responsibility is to express an opinion on the design of the system of quality control and the firm's compliance therewith based on our review.

Required Selections and Considerations

Engagements selected for review included an engagement performed under Government Auditing Standards and an Audit of an Employee Benefit Plan.

As a part of our peer review, we considered reviews by regulatory entities as communicated by the firm, if applicable, in determining the nature and extent of our procedures.

P. 0. Box 1549 4766 /-49 North Service Road Opelousas, Louisiana 70570 Phone: 337-948-4848 Fax: 337-948-6109

112 Fountain Bend Dr. Lafayette, LA 70506

Phone: 337-984-9717 Fax: 337-984-5544

To the Shareholders ofT.S. Kearns & Co, CPA, P.C. and the Peer Review Committee of the Louisiana Society of CPA's February 6, 2018 Page 2

Deficiency Identified in the Firm's System of Quality Control

We noted the following deficiency during our review:

1. The firm's quality control policies and procedures regarding Human Resources and Engagement Performance over its' Employee Benefit Plan (EBP) practice has not been suitably complied with to provide reasonable assurance that EBP audit engagements are consistently performed in accordance with professional standards. During our review we noted that 1.) The EQCR Partner and the staff auditor did not have current EBP continuing education and 2.) Findings from an outside pre-issuance review were not addressed in full. As a result, on the firm's only EBP audit, the firm did not 1.) Properly document its procedures related to a service auditor's report, 2.) Did not properly test participant contributions and Plan income allocations, and 3.) Ensure all required notes disclosures were included in the notes to the Plan's financial statements. In our opinion, these issues contributed to this EBP audit engagement not conforming to professional standards in all material respects.

Opinion

In our opinion, except for the deficiency previously described, the system of quality control for the accounting and auditing practice of T.S. Kearns & Co, CPA, P .C.in effect for the year ended August 31, 2017, has been suitably designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. Firms can receive a rating of pass, pass with deficiency(ies) or fail. T.S. Keams & Co, CPA, P.C. has received a peer review rating of pass with deficiency.

;J ~ld John S Dowling & Company

February 6, 2018

To the Peer Review Committee of the Louisiana Society of CPAs

Ladies and Gentlemen:

This letter represents our response to the report issued in connection with the peer review of the firm's system of quality control for the accounting and auditing practice in effect for the year ended August 31, 201 7. The remedial actions discussed in this letter will be monitored to ensure that they are effectively implemented as part of our system of quality control.

The firm has modified its quality control policies and procedures to include centralized monitoring of the firm personnel's compliance with regulatory and organization membership EBP CPE requirements. The importance of meeting these EBP CPE requirements was discussed recently in a one-on-one personnel meeting with appropriate staff. Additionally, we have implemented a policy whereby all EBP audit engagements will be subject to external pre­issuance review and this will be done in a manner which will allow sufficient time to address all recommendations, prior to audit issuance.

These remedial actions will also be emphasized in our monitoring procedures and internal inspection.

We believe these actions are responsive to the findings of the review.

T.S. Keams & Co., CPA Managing Partner

TIMOTHY S. KEARNS MASTER OF BUSINESS ADMINISTRATION

CERTIFIED PUBLIC AccoUNTANT

T.S. Kearns & Co., CPA, PC 164 West Main Street, Thibodaux, LA 70301

(985) 447-8507 Fax (985) 447-4833 www.kearnscpa.com

BRANDY I. KEARNS CERTIFIED IN FINANCIAL FORENSICS

CERTIFIED PUBLic AccoUNTANT

..

Society of louisiana @AICPA'Certified Public Accountants

PeerReview Program Administered in Louisiana

May 07,2018

Timothy Kearns T.S Kearns & Co., CPA, (APC). 164 W Main St Thibodaux, LA 70301-5216

Dear Timothy Kearns:

On May 07, 2018, the Louisiana Peer Review Committee discussed the report on the most recent System Reviewof your firm and your firm's response thereto.

As you know, the report had a peer review rating of Pass with deficiencies. The Committee accepted the aforementioned documents with the understanding that the firm will take the actions outlined in its response to the report, which will be monitored during your firm's next peer review and:

• Agree to permit an outside party, acceptable to the Committee, to(a) perform a pre-issuance review of the reports and financial statements on the next employee benefit plan engagement, commencing immediately, and to(b) submit a report to the Committee on its progress in implementing the corrective action recommended in the report. The report is due to the Committee by August 31, 2018. This action will be performed at the firm's expense. This action may be performed by the team captain.

• Agree to have all professional staff participate in at least 16 hours of continuing professional education specific to employee benefit plan auditing. Please send a letter to the Committee detailing the courses taken, along with proof of attendance, by each individual by August 31, 2018. If anyone has taken CPE in this or similar areas in the previous six months, please contact the peer review department to determine if the course qualifies. Self study and teleconferences will not satisfy this requirement.

As a reminder, independence would be considered impaired for purposes of being able to perform a firm's peer review (whether as a team captain or team member) for anyone also performing pre-issuance or post-issuance reviews, performing a revisit, reviewing the quality control document or formal CPE plan, reviewing corrective actions of non-conforming engagements, reviewing the firm's remedial actions in its letter of response, performing,

P.O. 8o~ 1279 • Destrehan, LA • 70047 • 1.800.288.5272 • 504.464.1040 • Fax 985.764.4345

Society of Louisiana '~AICPA:Certified Public Accountants

PeerReview Program Administef'e<i in Louisiana

oversighting, or visiting during an inspection, or reviewing or oversighting the firm's monitoring report prior to the peer review. The only exception is if this action was performed for the year immediately following the previous peer review year end. Therefore, performing pre-issuance or post-issuance reviews, performing a revisit, reviewing the quality control document or formal CPE plan, reviewing corrective actions of non-conforming engagements, reviewing the firm's remedial action in its letter of response. performing. oversighting, or visiting during an inspection, or reviewing or oversighting the firm's monitoring report in the year immediately preceding or during the peer review year would impair independence for peer review purposes.

P.O. Box 1279 • Destrehan, LA • 70047 • 1.800.288.5272 • 504.464.1040 • Fax 985.764.4345

Society of louisiana @AICPA:Certified Public Accountants PeerReview Program

Administ.,ed in louisiana

The documentation for your corrective action(s) should be submitted through the Peer Review Integrated Management Application (PRIMA) system by the due date.

Please note that Paragraph .144 of the Standards for Performing and Reporting on Peer Reviews states that a firm that fails to correct deficiencies or significant deficiencies after consecutive remedial or corrective actions required by the Committee on the same peer review may be deemed as a firm refUSing to cooperate.

Your firm's agreement to take this action voluntarily demonstrates its commitment to the objectives of the AICPA Peer Review Program. Please acknowledge your agreement within PRIMA.

Sincerely,

Stacey Lockwood Director of Professional Oversight slockwood@lcpa.org 504-904-1136

Society of Louisiana CPAs

CC: George Pavy, Brandy Kearns

Firm Number: 900010130898 Review Number: 555710

P.O. Bo~ 1279 • Destrehan, LA • 70047 • 1.800.288.5272 • 504.464.1040 • fa~ 985.764.4345