Read the forensic accounting report down below and answer the questions in the end. Make sure that the answers are related to the report that you just read.

Description of Assignment

Pursuant to the terms of our engagement, you have requested we provide a written report summarizing the procedures we performed along with the results of those procedures in the above referenced matter.

Turner & Bissell, LLC was engaged to assist you for the purpose of analyzing and compiling evidence of potential loss from the alleged diversion of funds by former Global Metal Stamping, Inc. Director, Treasurer, and Controller, Greg Brenner ("Brenner").

Background and Understanding

Global Metal Stamping Inc. ("Company") is a manufacturing company located in Deerfield, MA that specializes in high powered, precision metal stamping and finishing.

Martin Derry ("Derry"), the current President, CEO, and majority shareholder, purchased the Company in March 2008. At the time of the 2008 acquisition, Mr. Brenner was given a 15% share of the Company as one of 4 partners. Mr. Brenner served as a Director, the Treasurer, and Controller. Mr. Brenner made no capital investment in the company in exchange for his shares.

It is our understanding Mr. Derry, Mr. Brenner, and the other two partners were all employees of the prior owner at the time of the acquisition. According to Mr. Derry, it was agreed that all four partners in the newly formed entity would take a 20% pay cut beginning April 1, 2008.

Prior to April 1, 2008, Mr. Brenner was earning an annual salary of $78,500. A 20% reduction should have resulted in an annual salary of $62,800. According to Mr. Derry, due to the financial success of the company, in May 2016 it was agreed that the 20% salary reduction would be reversed, and Mr. Brenner would return to the annual salary of $78,500. It is our understanding that he remained at that salary until leaving the company.

Confidential Attorney-Client Privileged

It is our understanding that Mr. Brenner, as the Comptroller, had complete autonomy in managing the financial affairs of the Company, including bookkeeping, check writing, financial record keeping, and payroll oversight.

The Company maintained an operating account at Nuvo Bank and Trust Company, account #7672, that later became Merchant's Bank account #3001 (see Exhibit A). Mr. Brenner had check signing authority for both of these accounts. Two (1) signatures were required for checks exceeding $5,000.

The Company utilized an outside payroll provider, Checkwriters Inc. ("Checkwriters") of West Holyoke, to process their bi-weekly payroll. Mr. Brenner was responsible for providing Checkwriters with the information that ultimately determined how much each employee would be paid during each payroll cycle. It is our understanding that Mr. Brenner received the bi-weekly payroll journals Checkwriters provided, and that these reports were maintained in his office and not reviewed by any of the other partners.

In June 2020, while Mr. Brenner was on vacation, Mr. Derry gained access to bi-weekly payroll journals that had been left on Mr. Brenner's desk. Mr. Derry noted that the year-to- date earnings for Mr. Brenner exceeded what would be expected for an annual salary of $78,500.

Mr. Derry contacted the Company's accountant, Milton Dantes, CPA ("Dantes") and asked him to perform a preliminary review the Company's finances for January through June 2020.

In addition to identifying excess payroll paid to Mr. Brenner in 2020, Mr. Dantes also identified numerous checks written from the Company's operating account payable directly to Mr. Brenner, as well as checks payable to American Express cards owned by Mr. Brenner: #7-31008, #1-32003, #1-33001, #1-34009, #1-35006, #7-33004, and #1-38000 (see Exhibit B). According to Mr. Derry, these payments did not represent reimbursements for Company expenses or purchases made on behalf of the Company.

On July 9, 2020, upon returning from vacation, Mr. Derry and Mr. Dantes confronted Mr. Brenner with Mr. Dantes's findings. As a result of that meeting, Mr. Brenner acknowledged taking the funds from the Company, and resigned effective immediately.

In Mr. Brenner's deposition on January 9, 2021, Mr. Brenner acknowledged taking the Company funds without authorization (see Exhibit C).

Globel Metal Stamping, Inc. Matter Copyright 2021 Turner & Bissell, LLC Page 2 September 10, 2021

Confidential Attorney-Client Privileged

Procedures Performed

On February 8, 2021 we first met with Mike Derry in our offices to gain an understanding of this matter.

At that meeting we were provided with a combination of paper and electronic copies of bank statements and cancelled check images for the operating accounts Nuvo #7672 and Merchants Bank #3001 for the period March 2011 through June 2020.

We were also provided a USB jump drive containing subpoenaed copies of Mr. Brenner's personal American Express statements for his multiple accounts (#7-31008, #1-32003, #1-33001, #1-34009, #1-35006, #7-33004, and #1-38000) for the period October 2011 through June 2020.

We also received copies of Checkwriters bi-weekly payroll journals for the time period January 2012 through June 2020, as well as an Excel spreadsheet Mr. Dantes prepared summarizing Mr. Brenner's payroll received for the time period April 2008 through June 2020.

Lastly we received Mr. Derry's Excel spreadsheets listing the checks payable to Mr. Brenner and payable to American Express cards owned by Mr. Brenner.

We reviewed the provided Excel spreadsheet listing Company checks payable to Mr.

Brenner from operating accounts Nuvo #7672 and Merchants Bank #3001 for the period

March 2011 through June 2020. We corroborated each identified check by locating the

corresponding cancelled check image. We created a schedule of the identified checks

payable to Mr. Brenner, and supplemented our schedule with images of each check (see Exhibit D).

We reviewed the provided Excel spreadsheet listing Company checks payable to American Express for cards owned by Mr. Brenner (#7-31008, #1-32003, #1-33001, #1-34009, #1- 35006, #7-33004, and #1-38000) for the period October 2011 through June 2020. We corroborated each identified check by locating the corresponding cancelled check image. We created a schedule of the identified checks payable to American Express, and supplemented our schedule with images of each check (see Exhibit E).

While reviewing the cancelled check images we identified a number of checks payable to Mr. Brenner and/or to American Express for Mr. Brenner's cards, that were signed solely by Mr. Derry, or that contained the signatures of both Mr. Derry and Mr. Brenner. We created a schedule of the identified checks, and supplemented our schedule with images of each check (see Exhibit F). We provided the schedule and cancelled check images to Mr. Derry

Globel Metal Stamping, Inc. Matter Copyright 2021 Turner & Bissell, LLC Page 3 September 10, 2021

Confidential Attorney-Client Privileged

for his review. Mr. Derry stated that the identified check images listed on our schedule that contained his signature, were not checks that Mr. Derry signed, and therefore he concluded that his signature on the identified checks had been forged.

We reviewed the Checkwriters payroll journals and Mr. Dantes's summary payroll schedule. We created a schedule comparing the payroll due Mr. Brenner based on his agreed upon salary, to the payroll actually paid to Mr. Brenner during the period April 2008 through June 2020 (see Exhibit G).

We noted on Mr. Dantes's summary payroll schedule a reference to a $25,000 bonus, where Mr. Dantes reduced the amount on his schedule by the $25,000. We inquired of Mr. Derry about the referenced $25,000 bonus, as we did not identify this amount on Mr. Brenner's Checkwriters reports. Mr. Derry stated the $25,000 may represent an estimated cumulative amount in bonuses authorized to Mr. Brenner throughout the period, but was unclear how to attribute the $25,000 to any specific authorized bonuses, or when/if they were paid. Our payroll schedule (see Exhibit G) does not contemplate the $25,000 bonus, as it could not be attributed to any specific time period or amount due Mr. Brenner.

Results of Procedures Performed

We determined that Mr. Brenner had sufficient access to the Company's accounting system, blank check stock, and payroll process to enable him to generate and process unauthorized transactions for his own benefit.

We determined that during the period March 2011 through June 2020 there were a total of ninety-seven (97) checks written from the Company's operating accounts payable to Mr. Brenner, for which Mr. Derry asserts there was no business purpose, and which Mr. Brenner acknowledged were unauthorized. The total of the identified checks approximated $251,215 (see Exhibit D).

We determined that during the period October 2011 through June 2020 there were a total of two hundred thirty-two (232) checks written from the Company's operating accounts payable to American Express for cards Mr. Brenner owned, for which Mr. Derry asserts there was no business purpose, and which Mr. Brenner acknowledged were unauthorized. The total of the identified checks approximated $960,171 (see Exhibit E).

We determined that for the period April 2018 through July 2020, Mr. Brenner was a salaried employee, and was paid through direct deposit on a bi-weekly basis.

We determined that Mr. Brenner's gross bi-weekly salary for the period April 2008 through May 2016 should have been $2,415.38 ($62,800/26).

Globel Metal Stamping, Inc. Matter Copyright 2021 Turner & Bissell, LLC Page 4 September 10, 2021

Confidential Attorney-Client Privileged

We determined that Mr. Brenner's gross bi-weekly salary for the period May 2016 through his final payroll, June 2020, should have been $3,019.23 ($78,500/26).

Based on our review of the Company's payroll, related records and information, as well as discussions with Mr. Derry, we determined that Mr. Brenner's gross bi-weekly payroll was paid at a rate in excess of what he was due from the initial, agreed upon salary reduction in April 2008, through the time of Mr. Brenner's final paycheck in June 2020. In addition, we also identified forty (40) instances where Mr. Brenner received multiple paychecks within given payroll cycles.

We determined that for the period April 2008 through June 2020, Mr. Brenner was paid approximately $212,926 more than his expected, authorized payroll (see Exhibit H).

As noted within #7 above, it appears Mr. Brenner's actual payroll was higher than authorized from April 2008 through June 2020. The company's bi-weekly contributions to FICA (Social Security and Medicare) were based on a formula, as a percentage applied against employees' actual compensation. Due to the fact that we identified Mr. Brenner's payroll was paid higher than authorized, we determined the calculations for FICA contributions based on Mr. Brenner's actual compensation were inflated.

FICA contributions are calculated as 7.65% of compensation (6.2% Social Security, 1.45% Medicare). We recalculated the Company's FICA contributions on behalf of Mr. Brenner, based on Mr. Brenner's authorized salary. Our analysis identified that the Company overpaid FICA relating to Mr. Brenner's actual payroll by approximately$17,094 (see Exhibit H).

Based on Mr. Derry's review of identified checks payable to Mr. Brenner and to American Express cards owned by Mr. Brenner, Mr. Derry identified fifteen (15) checks payable to Mr. Brenner containing Mr. Derry's forged signature. The total of those checks approximated $38,361. Mr. Derry also identified an additional twenty-nine (29) checks payable to American Express containing Mr. Derry's forged signature. The total of those checks approximated $167,813. These identified checks have been included in the total losses detailed in #2 and #3 above.

Based on the procedures described above, and the results of those procedures, it appears the Company suffered a loss approximating $1,441,407, as summarized on our Identified Loss Schedule (see Exhibit I).

Questions

1. Indicate whether you agree or disagree with the results of the procedures performed by the forensic accountants and any of conclusions they reported within the forensic accounting report, and why.

2.Identify any issues you noted relating to the report form, format, structure, content, and similar areas of criticism. If you identified none, write "None Identified."

3. Identify any issues noted concerning the procedures they performed, procedures they omitted or did not perform, results of their procedures, conclusions they reached, and similar areas of criticism. If you identified, none write "None Identified."

4.Identify any report writing issues, poorly worded, overly technical, vague or ambiguous language, and similar criticisms you identified. If you identified none, write "None Identified."

5. Identify at least five (5) strengths within their report, approach, and findings, that counsel would need to overcome

6. Identify at least ten (10) weaknesses with their report, approach, procedures, findings, or anything else with their work, and the results of their work, that counsel can exploit.