Jyothsna Sarikonda

#1- Concessions

We initiated an investigation and determined there was a difference in the concessions inventory
reported by Julie in the perpetual inventory and the inventory count reported by Holly. Between May
2009 and September 2009, Julie reported that a total of 25,950 less concessions were sold compared to
that of what Holly reported. Based upon the missing inventory, and the cost per unit of the respective
concession, the total revenue loss identified for TBC is: $14,677.50.

In addition to the concessions revenue loss, we also identified questionable spoilage write-offs totaling
$14,677.50. Surprisingly, spoilage write offs is exactly of the same amount as the concessions missing
inventory. Julie chose to file a write-off equals to missing inventory though it seems she did not realize
the missing inventory was on the end of the game day and she is writing off at the end of the month.

Investigation Results:

Background:

As a part of our investigation, we observed the concessions operations and the storage room. The
storeroom was neatly arranged even though some supplies are low. After speaking to Holly, we noted
that she takes utmost interest and care concessions inventory and mentioned that she takes an
inventory count for her own peace of mind.

Observations and Evidence Trail:

The perpetual inventory noted by Julie does not easily reconcile with the purchase orders, the physical
inventory of the concessions reported by Holly and the concessions sales. Also, we find that concessions
that Julie is writing off like soda and popcorn normally does not spoil that fast. This is observed
repeatedly throughout the five-month period for which we have reports. The General Journal also
indicates that the spoilage account is unusually high.

Based on the Phils bank statements, it has been observed that he has been helping the Julies family.
Phil pays Julies tuition at Tallahassee Community College. Besides getting help from her uncle towards
her college tuition, she also has deposits $10,000 on September 30, 2009 in cash from her uncle which
she agreed to it and is the same amount of withdrawal from Phil Ackers account on the same date.

Also, a part of our observation, we watched Julie taking out the inventory boxes from the storage room
and putting out those boxes into a truck which is not licensed under her name. On following the truck,
we saw Julie unloading the boxes into the back door of a Stop N Shop, her parents store. Also, we
observed Julie leaving the store right after.

Interview results:

Our investigation was mainly focused on making Julie to agree to the theft she was dealing with on
game days. She initially said that, she does not work at her parents place Stop N Shop over the
weekends, and then later when we told about her mother informed us about her helping over the
weekends, Julie changed her answer to Yes.
She also accepted she gets help from her parents store as a allowances, which is too much to get every
month for a college student. She also agreed to getting help from her uncle, Mr. Philip Ackers and has
deposits from her uncle to her college account every month.

When we asked about the boxes she is dropping off at her parents shop, she replied by saying she is
dropping her class textbooks and for the truck, she replied she borrowed from her friends. Although, she
owns Honda Civic, something did not sound right when she said the borrowed the truck from her
friends.

With regards to concessions write-offs at the end of the month, especially the ones like soda and
condiments that wont go bad that fast, her reply was the storage was in basement and there is no
minimum maintenance in the storage and is the reason to write off end of the month and when we
asked the same question to Phil Ackers, he said she is taking out the waste from spoilage which does not
match with Julies answer. This is not consistent with our physical observation of the storeroom during
our concession operations observation.

When we asked about the missing inventory count, she said that Holy did not count properly or she
might have counted the spoilage also and is the reason for inventory count. Holy counts the inventory
only in the morning before each game only and games are held in the middle of the month. Also, during
our observation, we saw Holly takes a great interest in counting the concessions inventory which is not
consistent with Julies answer.

When we asked Julie about transactions related to her personal bank account, she was surprised and
curious and said, how could we go through her personal bank account. We think that if there is nothing
wrong or suspicious is going on with their accounts, one should be anxious about auditors going through
the accounts.

Conclusion:

Based on our interviews with Julie and Mr. Ackers, we felt Julie was deliberately hiding some
information with regards to the concessions. She did not reply truthfully when asked about working for
her parents and the allowances she is getting from Stop N Shop were questionable. Apart from that,
when asked about the unusually high spoilage, the answers from Julie and Phil did not match. Neither
Mr. Ackers specified about unmaintained storage not our investigation yielded any such information.

Although, Julie did mention that she was dropping off her class books in the pickup truck, this did not
reconcile with her action of leaving the store immediately after dropping of the boxes. We find no
correlation to why Julie had to drop off her class books at the store in a pickup truck borrowed from her
friends and then leave the store immediately.

Correlating the missing concessions with Julies actions of transporting the boxes to her parents store,
we are suspicious that, she is taking large portions of remaining concessions after the game to her
parents store, where they are resold. Further, since Mr. Ackers was related to Julie Roper, and he was
helping Julie to pay for her college and supports her family too, based on the answers to the interview
questions, we suspect that, Mr. Ackers also has some knowledge of the missing concessions.
We suspect that, Julie Roper is guilty of stealing concessions from inventory storage room and leading to
revenue loss of $14,677.50 to TBC over the five-month period while Mr. Phil Ackers helping her in this
act.
#5- Payroll

Payroll receipts from ADP May 2009 to September 2009 to players and Officers

We compared Payroll receipt books to the payroll system and amounts deposited at the ADP bank
account. We identified and matched a total of $57,848.42 payroll payments that were paid to Players
and Officers biweekly including properly calculated FICA and Federal taxes.

Payroll receipts from ADP May 2009 to September 2009 to game day employees

We traced all payments made to game day employees deposited into their accounts and ADP bank
deposit receipts based on the category. The total amounts were in each game day are

Anna Meerova

#2- Construction

There is no record of the loan provided by US Bank to TBC Company at the time construction of the new
building was about to start. There are construction invoices in place and journal entries as well as
Construction in Progress account in Balance Sheet, all of them match, so no visible loss in cash is found.
However, it is unclear where the money came from, as there are only two bank transactions, cash
withdrawals, for the amounts of $10,000 and $52,893.50, both of which do not match General Journal
entries.

The two withdrawals from Larkin Construction Account took place March 13th and September 30th, for
amounts of $10,000 and $52,893.50 respectively. They do not match amounts in General Journal and
invoices. Trace bank deposits slips and receipts for these amounts. Bank deposit slips and receipts
weren`t available to us. However, due to the Mr. Ackers` statement during the interview where he
admitted that his wife, Madelyn Harris Ackers, oversees budgeting in their family. She has an access to
their joint bank account. She is also in possession of a savings bank account, which totals $17,593.50 as
of September 30th, (see Construction <Anna LW2 worksheet). This information can be found in Mr. and
Mrs. Ackers` bank statements. There is a cash deposit made to the Madelyn Harris Ackers` savings
account on March 13th, which correlates with a withdrawal made the same day from the Larkin
Construction account. In addition, Mrs. Ackers` savings account has a deposit of $52,893.50 made
September 30th, which equals the amount that was withdrew from the Larkin Construction that day.

We would also like to point out the contradicting statements from Ben Hill and Phil Ackers regarding a
bonus that Mr. Hill had received on September 30th (see TH6 Bank Records). Mr. Hill confirmed that
he`d receive a bonus from TBC; Mr. Ackers, however, was very surprised to find out that somebody else
besides himself in the company receiving bonuses. This contradiction in statements made us question
the company`s structure at the executive level. We could not find any bank deposit slips or receipts to
prove our conclusion.

No deleted transactions were found.

Based on Larkin`s invoices, it appears that Larkin started working for TBC in January. This company
employed various subcontractors starting January through May. It looks like Larkin`s subcontractors cost
Larkin $273,765.12 (see Subcontractors worksheet), they charged TBC $858,192.26 total.
Multiple attempts made by the audit team to gain access to the TBC`s bank statements from January to
September of this year, for tracing the loan for $858,192.26 and correlate this amount with Larkin
Construction`s invoices and to see how this loan was spent, were not awarded by TBC`s executive, Mr.
Ackers. Mr. Ackers was very uncooperative in request to provide company`s detailed bank statements.

#3- Equipment Purchases

According to Original Handout 9 Equipment purchase orders, invoices and receiving slip:

*$7,371.45 was spent May 5th, this transaction was recorded in Gen.J. May 7th;

*$344.94 was spent May 20th, transaction was recorded May 21st in G.J.;

*$1,869.34 was spent June 5th, while in G.J. only $1,819.44 was recorded ($49.90 less) June 7th in G. J.;

*$2,299.90 was spent June 20th, transaction was recorded June 21st in G.J.;

*$2,589.66 was spent July 5th, transaction was recorded September 6th in G.J.;

*$839.72 was spent July 20th, transaction was recorded September 1st in G.J.;

*$2,204.79 was spent August 5th, transaction was recorded August 7th in G.J.;

*$189.99 was spent August 20th, transaction was recorded August 21st in G.J.;

*$7,441.41 was spent September 5th, transaction was recorded September 7th in G.J.

Cash loss equals $49.90.

Julie usually forwards checks, receiving reports, purchase orders and invoices generated in a process of
ordering and receiving equipment to either Mr. Hill or Mr. Ackers. Which is what she did on June 5th.
Since we did not have access to either of the purchasing documents, we could not find at what point the
$1,869.34 amount was decreased to $1,819.44, the correlating amount recorded in the General Journal.
Thus, $49.90 are not included in the books.

Ms. Roper nor Mr. Hill both stated that neither of them has anything to do with the equipment
purchases and entering data into the General Journal. Although Mr. Hill oversees receiving purchasing
documents, such as purchasing orders, invoices, receiving reports and checks per the Tallahassee
Organizational Chart. Mr. Ackers stated that he himself often receives those documents from Julie Roper
and signs checks. Which leads us to the conclusion that both Mr. Hill or Mr. Ackers could intentionally
enter lesser amount on the books to benefit from that equipment purchase made on June 5th.

Although, there is a concern involving two orders on July 5th ($2,589.66) and July 20th ($2,299.90). The
amount spent July 5th wasn`t recorded in General Journal until September 6th and the amount spent July
20th wasn`t recorded until September 1st.

We`ve traced personal bank accounts for finding lost cash and to see if cash was deposited in the
amount that equals or less than $2,589.66 and $2,299.90. None was found. However, we have found
that there are significant inconsistencies with General Journal entries and Financial statement
reconciliation from general journal in relation to the Equipment account. The balance in TH16 Financial
Statements Recap is significantly smaller, $500, than the balance in the General Journals, which is
$25,101.30 (see Equipment purchasing <Anna LW2> worksheet). Based on Financial statement
reconciliation from general journal we`ve concluded that equipment for a large amount was returned
each month for the period from May until September. There is no supporting entries or any other
evidence that equipment was returned on a regular basis. We could not trace where the cash went
because of equipment being returned. The person who is experiencing pressure to commit this fraud
(large bills to pay such as monthly alimony and child support in amount of $1,000), has an opportunity
(access to the purchasing documents), and can rationalize his actions (strongly believes that he works
hard and deserves additional bonuses just like the President of TBC, Mr. Ackers) is TBC` office manager,
Ben Hill.
Engagement letter
 Smith & Associates
1111 Madison St.
Seattle, WA 98101
Tel: (503)428-0994
www.smithassociates.com

_________________________________________________________________________________________

Invoice
To: Mr. Franklin Kennedy Invoice date: Dec 7, 2016
Tallahassee Bean Counters, Billing through: Oct 28 ,2016
Florida, USA

Performance and Operations at TBC

For professional services rendered on the above referenced project for the period ending: Dec 7,2106

Associate/Partner Rate Hours Total Billed

Partner Smith $300 7.25 $2,175

Sally Sleuth $150 2.00 $300

Jyo $100 20 $2,000

Anna $100 20 $2,000

Ben $100 20 $2,000

Total service amount: $8,475

File A
Reflective Essay
Anna Meerova

This project was an amazing experience! I really liked the process of going through the information and
marking the parts I needed for my part of the project, and connecting the dots. There were a lot of the
dots. I learned to sift through the large number of worksheets, emails and to look for the relevant
information. The longer I did it, the clearer the picture became. Basically, I learned to put little pieces of
information together to form my own story, a theory I got to include in my part of the report. During the
interviews, I learned that people would do and say anything they believe is true or to cover up a crime
they acknowledge but would never confess to. I discovered that I could get sympathetic and believe
them. This was the hardest part for me. I knew that they were lying sometimes but they were so
convincing that I caught myself thinking at least a few times: maybe I was wrong.

Next time I would start with visiting (emailing) and interviewing people who are part of the suspects`
outer circle. For example, I should have started with talking to Sam McCarty, the equipment manager at
TBC. I did not think that he was guilty, so I could`ve talked to him in the beginning of investigation to
hear his opinion about his bosses. I would also at least get familiarized with situations in other functions
as well, even though I wasn`t assigned to investigate them, to form a larger picture about people and
operations at TBC. Other than that, I think I did ok on this project with the time and information I had,
and my limited experience.

Jyothsna Sarikonda

I have really enjoyed working with this project. I liked analyzing data, comparing worksheets, compare
the data across various reports, get more data to narrow down the evidence to get result. The best part
of it is getting closer to finding the suspect. For sure, this project was way more fun and, along with the
process of interviewing suspects, it is wonderful way of fun filling learning and knowledge sharing to get
an idea how the Forensic analysis and reporting works. Apart from this, I enjoyed working in a team like
environment rather than working alone which happens in most of the other class projects.

For next time, I would like to spend more time and would like to work more on analyzing data, asking
more questions, take everything teeny tiny small data into consideration. I want to think through each
situation, and try to frame more open ended questions. I would be more sympathetic and more
consoling towards interviewees, always ask why when framing questions. I will try to make more
friendly conversations with the interview candidates, to get the all the information I need to further my
investigation. Overall, I think there way more lot to learn in forensic analysis. If there is one thing I
should learn from this exercise, it is the skill of interviewing. I realized that it is very hard to get people
to confess even though we have a good amount of evidence. I also learnt that team work is also very
important to get the results. Correlating all the available pieces of evidence, communicating and not
missing out any piece of information, and improved and increased team coordination is also something I
would do better next time.
 File B
# Concessions: The revenue loss broken down by each concession category is as follows:

Missing Inventory Based on Hollys inventory report, Purchase orders and Concession Sales

Year Month Date Hamburgers # Hotdogs # Soda # Beer # Condiments # Popcorn # Peanuts # Total Loss #
2009 May (400) (600) (600) (400) (2000) 0 0 (4000)
Jun (800) (800) (800) (700) (2000) 0 0 (5100)
Jul (300) (300) (500) (200) (1000) 0 0 (2300)
Aug (400) (300) (500) (200) (1000) 0 0 (2400)
Sep (1400) (1200) (2200) (1350) (6000) 0 0 (12150)
2009 Total (3,300) (3,200) (4,600) (2,850) (12,000) 0 0 (25,950)

Hamburgers $ Hotdogs $ Soda $ Beer $ Condiments $ Popcorn $ Peanuts $ Total Loss $

Result: Total Revenue Loss for TBC ($4,620.00) ($4,000.00) ($1,610.00) ($3,847.50) ($600.00) $0.00 $0.00 ($14,677.50)

# Payroll

15-May 1,615.29
7-Jun 1,642.47
26-Jun 1,638.03
11-Jul 1,037.21
8-Aug 1,188.32
22-Aug 739.82
12-Sep 1,029.94
27-Sep 633.66
Players Gross pay biweekly Gross pay -5 months of contract FICA@7.65% Federal Taxes Net pay
Abelson, B. 1,562.50 15625 119.53 234.38 1,208.59
Bailey, R. 1,500.00 15000 114.75 225.00 1,160.25
Biancalana, B. 1,250.00 12500 95.63 187.50 966.88
Brett, J. 1,562.50 15625 119.53 234.38 1,208.59
Bridges, S. 1,375.00 13750 105.19 206.25 1,063.56
Buckner, W. 1,437.50 14375 109.97 215.63 1,111.91
Campbell, L. 1,750.00 17500 133.88 262.50 1,353.63
Chester, B. 1,500.00 15000 114.75 225.00 1,160.25
Curtis, J. 1,562.50 15625 119.53 234.38 1,208.59

PayrollFunction.xlsx
FILE C
Correspondence Log

11/23/16

1. I can't confirm this. I only saw boxes.

2. They sell the same brands in the store as at the ball park. Not sure how you can prove this?

Hello Ms. Sleuth,

Thank you very much for this investigation. It is really a great information. I think this evidence
good enough to prove Julie's guilt. However, I need some more evidence to nail this case.

1. I need you to please confirm if the boxes Julie loading into the truck contains concessions
from TBC.
2. If boxes contain Concessions from TBC, can you please check ,if these indeed were sold at
Shop N Stop. May be one way of doing it is walking into the store and looking for Sysco
branded concessions or even getting hold of sales invoice.

Hello JYO - SEE ALL CAPS BELOW

We really appreciate you helping us with our auditing TBC. I have couple of requests,

1. I got permission from Mr. Ackers to continue my investigation on TBS operations work. Can
you please find out that closing process for the inventory after game by going back into the
storage room.

WELL - I OBSERVED THE STOREROOM AFTER THE GAME. THIS IS WHAT I SAW

((I, Sally Sleuth - licensed P.I. #34789 in state of FL, observed the TBC concession storage room
after the game. I saw Julie Roper arriving in a pickup truck and loading boxes in the bed of the
truck. I followed the truck and witnessed Julie unloading the boxes into the back door of a Stop
N Shop on the far side of town. Julie let herself into the trailer next door, then later drove away
after waving good-bye to her mother standing on the stoop. I went into the Stop N Shop, and
chatted with Julies mother working behind the counter. She confirmed that Julie is her daughter
and works there on weekends.))

2. I see a lot of write offs on the journal general for concessions. I wanted to understand why
there are lot of write offs because usually concessions like condiments, sodas, beer wont go bad
so fast.

I CAN'T HELP YOU WITH THIS - YOU WILL HAVE TO FIGURE IT OUT USING OTHER
DOCUMENTS OR PROCEDURES... OR PERHAPS YOUR INTERVIEWS.

3. Also, from the accounts you have provided earlier, i see that there are deposits from TBC to
Phil Ackers account. May i know why are they depositing those large amounts into his account.

I CAN'T HELP YOU WITH THIS - YOU WILL HAVE TO FIGURE IT OUT USING OTHER
DOCUMENTS OR PROCEDURES... OR PERHAPS YOUR INTERVIEWS.

4. I also see transactions to/from Phil's account to Bud Roper's account.

Please let me know who is Bud Roper.

I BELIEVE I TOLD YOU VERY EARLY ON THAT JERRY ROPER IS JULIE'S FATHER.
HE OWN'S THE STOP-N-SHOP WITH HIS WIFE - SARAH HARRIS ROPER. I AM NOT
100% SURE, BUT I THINK THAT JERRY ALSO GOES BY THE NAME OF "BUD".

Hello Ms. Sleuth,

We really appreciate you helping us with our auditing TBC. I have couple of requests,

1. I got permission from Mr. Ackers to continue my investigation on TBS operations work. Can
you please find out that closing process for the inventory after game by going back into the
storage room.
2. I see a lot of write offs on the journal general for concessions. I wanted to understand why
there are lot of write offs because usually concessions like condiments, sodas, beer wont go bad
so fast.
3. Also, from the accounts you have provided earlier, i see that there are deposits from TBC to
Phil Ackers account. May i know why are they depositing those large amounts into his account.
4. I also see transactions to/from Phil's account to Bud Roper's account. Please let me know who
is Bud Roper.

Hi Jyo,

YES - YOU HAVE PERMISSION to do your operations work

(((ADVICE - since you have some reason to believe people are cheating - you shouldn't
precisely say you don't think people are cheating. Instead, you could say that your primary goal
is to look for operations and efficiency. If anyone was cheating, it certainly would be inefficient
and hurt operations.... so your professional standards do require you to think about this. Sorry if
it feels so negative, is our primary goal to help you and your company perform its best.))))

Hello Mr. Ackers,

Thank you very much for your response.

I do not think you people are cheating. Instead, I am just trying to understand your current
operation procedures by observing everything which includes opening and closing the store
room, counting inventory, so that I could suggest you changes to improve the operations.

From your email, I assume that I do have a permission to look at the operation procedures for my
auditing activities.

Thank you very much for your time.

HELLO JYO

THANK YOU FOR APOLOGIZING.

1) IF MR. KENNEDY HAS GIVEN HIS PERMISSION, THEN OF COURSE IT IS POSSIBLE

TO DO YOUR AUDITING ACTIVITIES. I'M JUST KIND OF SURPRISED BY THE WORD
"SURVEILLANCE" - THAT SOUNDS LIKE YOU THINK WE ARE CHEATING - RATHER
THAN TRYING TO HELP US IMPROVE OUR OPERATIONS.

2) NOT SURE WHAT YOU MEAN BY 'CLOSING' PROCEDURES. JULIE, BEN, HOLLY
AND I (PHIL) ARE THE ONLY ONES WITH KEYS TO THE STOREROOM. AND WE
TAKE INVENTORY EVERY DAY I BELIEVE. I DON'T THINK ANYONE COULD BE
STEALING CONCESSIONS.

Hello Mr. Ackers,

I am extremely sorry for upsetting you. Please accept my apologies.

Please don't be concerned about anything. I beg your pardon for all this. I was just doing my job.

Having said that, Mr. Ackers I have couple of questions to ask about the surveillance.
1. I understand that Mr. Kennedy gave us permission to observe inspection process before the
game in the morning. May I ask your permission to get surveillance after the game as well, to
keep track of concessions getting sold and left overs.
2. Also, like to see the closing procedure, if anyone is stealing any concessions without Julie's
knowledge.
OK - so this is more clear. That you were asking SALLY these questions... I will answer below,
but not sure you are going to like the answers.

Sally Sleuth:

Hey there LW-2.

I'm not sure why the amounts are flowing in/out of personal bank accounts and Larkin
Construction. That seems very suspicious. The only additional thing I can find about Larkin is
the following. You are probably just going to have to compile your evidence and at some point,
confront the folks who have suspicious activity.

FROM SALLY

Larkin Construction Established 1982 Randall Larkin, owner 1432 Main Street Tallahassee, FL
Business License #3675841.Well-established commercial construction firm, has had many large
contracts, especially in the last 10 years. They recently hired Gerry Newbold, a former teammate
of Phil Ackers, to act as liaison between Larkin Construction and the Tallahassee Bean Counters.
Phil and Gerry played ball together and Phil was thrilled to reconnect with his old friend. They
often went for drinks or dinner together during the construction of the training facility.

11/22/16

Team LW 2:

Dr. Smith, I just wanted to clarify that my last two comments were for Sally Sleuth... -Anna

11/22/16

Mr. Ackers:

Hello Anna,

As I just told your colleague Jyothsna, I will not be answering any more of your questions until
you talk with Partner Smith. You had no right to obtain personal bank account information. I will
be contacting my personal lawyer. President Phil Ackers.

11/22/16

Team LW 2 & Mr. Ackers:

1) We asked: "Per TH6 bank records, TBC withdrew only $52,893.50 when payments for Larkin
Construction totaled $858,192.26". You answered: "UMMM - NEED DATES OR SPECIFIC
REFERENCES TO A SHEET TO HELP WITH THIS". You can find it in TH6 Bank Records
(Additional Handouts-2) in rows 33 to 36 there are two withdrawals related to Larkin
Construction $10,000 (March 13) and $52,893.50 (September 30). I did not mention $10,000
because it occurred before May when I thought construction started. But after reading your
answer about timeline of the construction (January through May), I think $10,000 is relevant.

2) We asked: "Where can I find the loan of $858,192.26 that was used to pay Larkin?" You
answered: "?? NOT SURE WHAT YOU MEAN." There is no information about $858,192.26
anywhere, except for the tab Mortgage in Additional Handouts. But we couldn`t find this
amount or component of this amount in TBC`s bank records. This is why we would like to
review complete bank records from January to September to try to understand how these monies
were used during construction period and after, when invoices were received. Thank you for
your time.

Team LW - 2

11/21/16 (1)

Team LW 2 & Sally Sleuth:

Good morning, Ms. Sleuth,

We were wondering if you can help us understand how TBC company operates in more detail
than handouts provided by Mr. Ackers allow us to understand. First of all, what does the
Account "Stop N Shop" relate to? What kind of business is it involved in? Is it sales related? Can
we please see their sales invoices?

STOP-N-SHOP IS A CONVENIENCE STORE OUTSIDE OF TOWN. IT SELLS TO

CUSTOMERS... BUT NOT REALLY RELATED TO THE BEANCOUNTERS EXCEPT
THAT JULIE'S PARENTS OWN STOP-N-SHOP. WOULD BE NEARLY IMPOSSIBLE TO
GET THESE - SINCE IS A SEPARATE BUSINESS.

And second, why does "Stop N Shop" depositing money to Julie Roper's account and Bud`s and
Sarah Harris`s accounts?

GOOD QUESTION - NOT SURE I HAVE AN ANSWER.

Thank you so much for your time!

Best,
Audit Team LW 2

11/21/16 (2)

Team LW 2 & Sally Sleuth:

Also, when you have time please investigate the following questions/observations:

1) In Subcontractors tab, are Garland Demolition Experts, Hayden Gardens, Advanced

Plumbing, Able Doors/Windows and so on, Larkin Construction`s subcontractors? If so, why
did they start working in Jan. and end in May and not in May through September, the time
frame when construction of a new building took place?

YES. BUILDING WAS CONSTRUCTED IN JAN TO MAY.... JUST THE INVOICES THAT
CAME LATER.

11/20/16

Partner Smith:

NICE ATTEMPT TO SAVE THE CLIENT FROM BEING SUSPICIOUS. YOU ALWAYS
HAVE TO BE CAREFUL ABOUT LYING/MISLEADING THOUGH. SO NOW IT WILL BE
DIFFICULT TO PROVE YOUR CASE WITH JULIE ROPER'S BANK STATEMENTS
SINCE YOU SAID YOU WEREN'T LOOKING FOR HER PERSONAL STATEMENTS...
BUT I THINK YOU ACTUALLY WERE. YOU SHOULD LOOK FOR THEM, BUT VIA
SALLY SLEUTH RATHER THAN PHIL. THIS IS A GOOD LEARNING MOMENT FOR
YOUR TEAM))

Mr. Ackers:

OK - THIS MAKES MORE SENSE. BUT I STILL WANT TO KNOW WHAT YOU ARE
LOOKING FOR IN THE BANK STATEMENTS.... ALL OF THE CHECKS AND DEPOSITS
IN THE BANK STATEMENTS ARE THE SAME AS THE GENERAL JOURNAL.... THERE
IS NO NEW INFORMATION THERE (I SHARED THESE WITH PARTNER SMITH ON
OUR FIRST PHONE CALL - FEEL FREE TO DOUBLE-CHECK WITH HIM)

BEST,
PHIL
11/20/16

Team LW 2 (Jyo) & Mr. Ackers:

1. Can you please provide ADP Payroll Services acknowledgements for salaries they paid to
employees and Summary receipts ADP sends to TBC.
PLEASE SEE TH 3

2. May we ask the count of the Concessions inventory that Holly Hope used to make and Julie
Roper Concessions inventory count after each game.
PLEASE SEE TH 15

3. Can you please provide Julie Roper bank statements for the last 12 months.
PLEASE SEE TH 6 (THESE ARE FROM SALLY SLEUTH - PHIL TELLS YOU THIS IS
NONE OF YOUR BUSINESS AND WONDERS HOW YOU THINK ASKING FOR
PERSONAL INFORMATION IS RELATED TO YOUR AUDIT. HE WARNS YOU TO BE
CAREFUL))

11/19/16

Team LW 2 & Mr. Ackers:

Dear Mr. Ackers,

Thank you so much for your email where you included the number we can reach you at. We do
have following questions for you.

#1 Will we be able to reach you via email in the future, after the playoff game?

I'M ALWAYS GOING TO GET TO E-MAIL....EVENTUALLY. ITS JUST TEXTING THAT

IS FASTER SINCE I DON'T SIT IN FRONT OF MY COMPUTER.

#2 Can you please provide the following information regarding the construction loan: conditions
of the loan, amount of the loan and who approved it?

SEE TH 9 - AND THE 'MORTGAGE' TAB IN THE ATTACHED. THE LOAN WAS
APPROVED BY THE BANK - AND ALSO BY PHIL.
#3 Would you please clarify when did the construction of the new training facility start and when
did it end?

CONSTRUCTION STARTED IN MAY AND FINISHED IN SEPTEMBER (PER EXHIBIT

18-17 ALREADY PROVIDED)

#4 We would also like to review a copy of the mortgage loan that was issued upon completion of
the construction.

SEE TAB FOR 'MORTGAGE' IN THE ATTACHED

#5 Can you please provide a copy of your contract with Larkin Construction?

THE CONTRACT SPECIFIES THE WORK ACTUALLY DONE - TO BE COMPLETED BY

OCTOBER AT THE PRICE IN THE BID.

#6 We would also like to review your bank statements for the last 12 months.

THESE ARE AT THE OFFICE IN FLORIDA - CAN YOU BE MORE SPECIFIC AS TO

WHAT YOU ARE LOOKING FOR? THE COMPANY BANK ACCOUNTS AGREE TO THE
GENERAL JOURNAL.

#7 And finally, we'd appreciate if you can help us to understand what is "change order July,
August, and September" mean in Construction Invoices Received by TBC document, who
approved these additions and why?

PHIL APPROVED ALL ASPECTS OF THE CONSTRUCTION PROJECT INCLUDING THE

CHANGE ORDERS. AS THE PROJECT WAS MOVING ALONG, LARKIN PROVIDED
SEVERAL IDEAS FOR IMPROVING THE FACILITY. THESE IDEAS CALLED FOR
HIGHER QUALITY MATERIALS AND A FEW LAYOUT CHANGES. OF COURSE, THIS
HAPPENS IN EVERY CONSTRUCTION/ REMODELING PROCESS.

We do appreciate your support at this time, and we hope to rely on it in the future!

Respectfully,
The Audit Team from Smith and Associates.

11/18/16

Mr. Ackers:
LW2 - reply to your request via text
Hello Team LW2,
Below, IN ALL CAPS, are my written replies. Also, attached is a spreadsheet with some more
information.

Dear Mr. Ackers,

Thank you so much for your email where you included the number we can reach you at. We do
have following questions for you.

#1 Will we be able to reach you via email in the future, after the playoff game?

I'M ALWAYS GOING TO GET TO E-MAIL....EVENTUALLY. ITS JUST TEXTING THAT

IS FASTER SINCE I DON'T SIT IN FRONT OF MY COMPUTER.

#2 Can you please provide the following information regarding the construction loan: conditions
of the loan, amount of the loan and who approved it?

SEE TH 9 - AND THE 'MORTGAGE' TAB IN THE ATTACHED.

THE LOAN WAS APPROVED BY THE BANK - AND ALSO BY PHIL.

#3 Would you please clarify when did the construction of the new training facility start and when
did it end?

CONSTRUCTION STARTED IN MAY AND FINISHED IN SEPTEMBER (PER EXHIBIT

18-17 ALREADY PROVIDED)

#4 We would also like to review a copy of the mortgage loan that was issued upon completion of
the construction.
SEE TAB FOR 'MORTGAGE' IN THE ATTACHED

#5 Can you please provide a copy of your contract with Larkin Construction?
THE CONTRACT SPECIFIES THE WORK ACTUALLY DONE - TO BE COMPLETED BY
OCTOBER AT THE PRICE IN THE BID.

#6 We would also like to review your bank statements for the last 12 months.
THESE ARE AT THE OFFICE IN FLORIDA - CAN YOU BE MORE SPECIFIC AS TO
WHAT YOU ARE LOOKING FOR? THE COMPANY BANK ACCOUNTS AGREE TO THE
GENERAL JOURNAL.

#7 And finally, we'd appreciate if you can help us to understand what is "change order July,
August, and September" mean in Construction Invoices Received by TBC document, who
approved these additions and why?

PHIL APPROVED ALL ASPECTS OF THE CONSTRUCTION PROJECT INCLUDING THE

CHANGE ORDERS. AS THE PROJECT WAS MOVING ALONG, LARKIN PROVIDED
SEVERAL IDEAS FOR IMPROVING THE FACILITY. THESE IDEAS CALLED FOR
HIGHER QUALITY MATERIALS AND A FEW LAYOUT CHANGES. OF COURSE, THIS
HAPPENS IN EVERY CONSTRUCTION/REMODELING PROCESS.

We do appreciate your support at this time, and we hope to rely on it in the future!

Respectfully,
The Audit Team from Smith and Associates.

Sent using OWA for iPhone

Kenneth Smith

You can reply to this message in Canvas by replying directly to this email.
Attached Files:
LW2- Additional handouts.xlsx - 12.4 KB [download]

11/18/16

Mr. Ackers:

Good night - can help you tomorrow

Hey there Audit Team

I've got to get some rest before the big game tomorrow. Please send me any questions at any time
- but it might be 24 hours before I reply... hopefully we beat the Gorillas tomorrow. We've got a
great chance as our shortstop is back and their best pitcher just got called up to the majors.

Best,
Phil

11/18/16

Phil Ackers:
Hey there Audit Team,
I really want to help you - but I've got so much to do getting ready for tomorrow's playoff game.
If you text me at 503-428-0994 when you send your information request - then I'll try to reply in
a couple hours.

Best,
Phil Ackers.

11/15/16

Partner Smith:

Hello Audit Team,

Well, I went ahead and asked my private investigator friend (Sally Sleuth) to go ahead and do the
standard background searches on all the employees. She is really good and was able to collect
the following information. She said it was going to cost us $9,000 and I got approval from Mr.
Kennedy on the condition that we use it to make a thorough examination. This is standard for our
clients, but I think Mr. Kennedy really wants to know it is a clean ship - or to nail the "sons of
guns" who are taking his money. I will answer your other questions tonight/early morning... but
thought these tidbits would be helpful.

Best,
Partner Smith

11/15/16

Sally Sleuth:

BACKGROUND INFORMATION ON PEOPLE AT BEANCOUNTERS by Sally Sleuth, P.I.

PHIL ACKERS, President

Home address: 4945 Bobbin Brook Court, Tallahassee, FL.
Home description: The house sits in an exclusive older section of northeast Tallahassee.
Vehicles: Nissan Sentra, this years model. Toyota Camry, three years old.
Wife: Madelyn Harris Ackers.

Information from personnel file:

Age: 53.
Length of employment by TBC: 10 years.
Prior employment: Owner-manager, Pizzanos Restaurant in Miami 10 years , prior to that was a
major league ballplayer for 10 years.
Education: MBA, University of Miami.
Information that can be gleaned from Phils co-workers: Phil is married with two grown
children. His wife has her own catering company, at which she does very well.

Information from public and private sources:

Criminal record: None.

Court records: No bankruptcies, no criminal action pending.
Property records: House on Bobbin Brook, Condo at Sandestin, two vehicles, a 35-foot sail-
boat, two jet skis.
IRS: Phil was audited extensively while at Pizzanos, though no action was taken. If students
speak to anyone who knew Phil during those days, he or she will report that the IRS suspected
him of tax evasion.
Credit report: Phil has good credit, but a lot of debt, including debt to department stores,
furniture stores, and loans on both vehicles. He also has student loans for his childrens
education.

CANDIE LARSON, Secretary/Receptionist:

Home address: 3232 Baragona Acres Road #45, Tallahassee, FL.

Home description: Her home is in a medium range apartment complex.
Vehicles: Honda Accord, eight years old; Yamaha V-Star 650 motorcycle, six months old.

Information from personnel file:

Age: 26.
Length of employment by TBC: 3 years.
Prior Employment: Red Carpet Realty, as a secretary for 5 years.
Education: Financial Certificate from Lively Vocational School.
Information that can be gleaned from Candies co-workers: Candie has never been married. She
is always dating at least one of the ball players, often more. She was born and raised in Perry,
Florida. Her father is a vice-president at Capital City Bank. She is the reigning Queen of the
Crab Festival for Taylor County. Candie dislikes Ben. She thinks he is a picky little man who
does not trust her or believe she has a brain in her head. Shes always complaining about being
his dating service. Women are always calling, including his ex-wife, asking for money. She
spends a lot of her time outside of work down at the playing field flirting with the players.
Gleaned from past employer: Candie was a good worker, if a bit of a flirt. She left with good
feelings all around.
Gleaned from public and private sources:

Criminal Record: Series of speeding tickets, most on her motorcycle.

Court record: Three times in driving school to remove tickets.
Property records: One car, one motorcycle.
IRS: No action.
Credit report: Three credit cards: Burdines, Dillards, and Goodys, all at credit limit. She owes
$165 per month on her motorcycle.

BEN HILL, Office Manager

Home address: 1832 Jackson Bluff Road #25, Tallahassee, FL Villa Cortez Apts.
Home description: It is an older apartment, situated in a less prosperous part of town.
Vehicles: Mazda Miata MX-5 convertible, this years model, purchased after he received his
bonus from TBC.

Information from personnel file:

Age: 42 years old.

Length of employment at TBC: 3 years.
Prior Employment, past ten years beginning with his most recent employer:
Three years at Tallahassee Doors, a small manufacturing firm.
Four years at the Florida Department of Transportation in the Financial and Auditing
Department.
Two years at Holiday Construction, as an accountant.
One year at Krispy Kreme Donut Corporation, as an accountant.
Education: 4-year degree in accounting, no CPA.

Information gleaned from co-workers:

Ben has been married twice that we know of. He had two kids with his first wife, but ended up
leaving her for wife number two. The second wife left him a few months ago; I think he had to
give her his house. Hes always dating someone or other, women are always calling here.

Gleaned from apartment manager:

Bens always late paying his rent, but then most of my tenants are. He always eventually pays it.
Always in cash, but I give him a receipt.

Information from public and private sources:

Criminal record: None.
Court records: Two divorces.
Divorce number one: his spouse was awarded $1,000 per month in child support and alimony.
Divorce number two: his spouse was awarded the family home and car, but no alimony or child
support.
Property records: Owns one car.
IRS: No actions.
Credit report: Shows a bankruptcy four years ago, and a debt of $14,000 in past alimony and
child support.
Information should students contact ex-wife #1: Benny started out nice enough, we had two
wonderful kids. He had a good job. Then that Dedrie came along. All the sudden it was lunches
with her and dinners with her and then he ups and leaves. For years I had been begging him to
take the kids to Disney World, but there was never enough money. We were saving for it, but
then after the divorce, he suddenly has money to buy Dedrie a huge diamond ring and even took
her on their honeymoon to Disney World, of all places! Then she divorced him and took him for
everything including the house. Providence, dont you think?
Information should students contact ex-wife #2: Benny just got boring. All he does is work,
work, work. It was time for me to move on.

JULIE ROPER, Assistant to the President

Home address: 1420 Seminole Drive #23, Tallahassee, FL.

Home description: Julie lives in an apartment near Tallahassee Community College with 3
roommates. It is a typical student apartment building. Not fancy.
Vehicles: Honda Civic, ten years old.
Parents: Jerry and Sarah Harris Roper. Niece to Phil Ackers as her mother is sister to Phil
Ackers wife Madelyn Harris Ackers . Her uncle is Freddy Harris, brother of Phils wife.

From the personnel file:

Julie is 23 years old. Shes a full-time student at TCC. She has been employed by TBC for just
less than one year. She is the niece of Phil Ackers. Prior to this job she worked at a convenience
store owned by her parents.

Information gleaned from co-workers:

Julie is a very hard worker. Everyone likes her, but shes not very social with anyone, so they
know nothing about her personal life. Everyone thinks it is because she works here and goes to
school, so she always seems in a hurry. Part of her pressure may be that Phil had her take over
some things that Terri the person who held this job previously would never do, such as ordering
concessions and collecting accounts receivable.
Information from public and private sources:

Criminal record: None.

Court records: None.
Property records: One vehicle.
IRS: No action.
Credit report: Julie has no credit cards. Her credit rating is good, if sparse.

TUCKER JOHNSON, General Manager

Home address: 8086 Baby Farm Road, Tallahassee, FL.

Home description: Tuckers house is firmly middle-class, in the country with several acres and
two horses.
Vehicles: Ford Excursion, this years model; Honda Accord, three years old.

From personnel file:

Age: 55.
Length of employment by TBC: 6 years.
Prior Employment: St. Louis Cardinals assistant pitching coach, 11 years. He played major
league ball in his twenties and early thirties.
Education: Degree in Sports Management.
Information gleaned from co-workers: Tucker is married, and has seven children. Only two kids
are still at home. He drives a new car every year, as payment for an advertising campaign he
stars in for a local car dealership.

Information gleaned from public and private sources:

Criminal record: One bar fight, 15 years prior.

Court Records: No bankruptcy or divorces. Assault charges dropped from fight.
Property records: One house, two cars, one powerboat, and three jet skis.
Credit report: Seven credit cards, only two with small balances.

MICHELLE SHELTON, Accounting Clerk.

Home address: 4571 Gautier Drive, Tallahassee, FL.

Home description: Michelle shares a nice townhouse with two roommates.
Vehicle: An eight-year old Toyota.
Information from personnel file:

Age: 21 years old.

Length of time at TBC: 2 years. She works part-time.
Prior employment: Chick-fil-A in Tampa for three years.
Education: Michelle is a student at FAMU, seeking a business degree. She transferred two years
ago from Tampa Bay Community College.
Information gleaned from co-workers: Michelle is trying to save up enough money to buy a
new car. Shes a hard worker, and everyone likes her. Michelle is going to school and sometimes
studies at her desk when there isnt much work to do.

Information from public and private sources.

Criminal record: None.

Court records: None.
Property records: One vehicle.
IRS: No action.
Credit report: Michelle has three credit cards, JCPenney, Burdines, and Victorias Secret. Each
carries a balance close to $200.

11/09/16

Partner Smith:
Dear Audit Team,

So, I want to be perfectly clear that the engagement letter asks us to do the following) Perform an
audit of the "Performance and Operations" of the Tallahassee Bean Counters. This will include
an assessment of the "Beancounters - original handouts" and any additional information you
deem necessary. The REPORT should be no longer than 5 pages and include at least 3 areas of
strength and 3 areas for improvement. The areas can be financial or operational in nature. Mr.
Kennedy would like there to be about 30 hours maximum spent on this. Please let me know
ASAP if you think you cannot complete in 30 hours. ((Note: This is reasonably broad - and Mr.
Kennedy wants this to be something he can read and share with the President and staff) Perform
a "review and assessment of fraud risks". Mr. Kennedy does not want anyone at the
Beancounters to know that he is looking for fraud at this time. We have checked with our legal
counsel and our professional standards and believe that we may share the phrase "Performance
and Operations Audit" to describe our work. Mr. Kennedy would like this part to take no more
than 20 hours. I let him know that this may not be possible - so the engagement letter indicates I
need to notify him as soon as we reach 15 hours for this part. And then we will need to notify
him for every additional 10 hours we spend. Since we charge $100 an hour for each staff
persons time and $300 per hour for my time, this is not unreasonable. The REPORT on our
"review and assessment of fraud risks" should probably be about 10 or so pages (not including
attachments), though it might be more or less. The REPORT should contain a definitive
conclusion in each function area as to what fraud risks were identified, and what, if any
indications of actual fraud were discovered/proven) Please schedule time for your WHOLE
GROUP and me to meet TWICE between now and November 30 at 5pm. You will schedule
these time slots (either 30 or 60 minutes as you see fit) with my Senior Secretary, Lisa Woods.
Lisa can be contacted via e-mail at Lisa.Woods@cwu.edu Lisa Woods has many other
responsibilities, so please be professional in your interactions with her. It will probably be best to
share with her several time slots that your team can meet. She also might reach out to you with
the time slots that I have) By November 14, send me a list of questions you have that you would
like answered. If at all possible, frame the question in terms of a PROCEDURE that you are your
team would conduct - such as "what would we learn if we did surveillance at XYZ location", or
"what would we find from looking at public records for Q person". Some of these steps/questions
will likely be easy to do/low cost, so I will provide the information. other things (like
surveillance) can be very expensive and we may not have sufficient budget. Feel free to structure
your requests into categories like "low cost" and "higher cost) TECHNOLOGY PROJECT -
every one of you is assigned two functions right now... you only have to do the tech project on
ONE FUNCTION. For that function, please review the structure of the state auditors work paper
B.2.19...... You should prepare a similar list of STEPS and RESULTS... with the results and
steps utilizing data from the "original" spreadsheet or any additional data you might obtain. Hope
this is helpful - I look forward to you completing an efficient and effective project Partner Smith.
Dear President Phil Ackers, I am pleased to introduce you to the Audit Team from Smith and
Associates. My name is Partner Smith and you can reach out to me with any major concerns. My
office is in Seattle, and my cell/text is 503-428-0994, please do not hesitate to reach out at any
time. It was good to talk to you on the phone just now and we are looking forward to doing our
"Performance and Operations Audit" for the Beancounters. I have received the engagement letter
from Mr. Kennedy, so we can get started right away. Thank you and your staff for putting
together the spreadsheet titled "Beancounters - original handouts", I've reviewed it and this
provides an excellent starting position for us. The Audit Team is a group of newer professionals
from the Seattle area, and they will be flying out to do a site visit on November 30. They will
only have a few hours to review documents and do some interviews with key staff. I know your
time and your staff's time is very valuable. The staff will analyze the spreadsheet and I have
given them your e-mail address. They have been asked them to do the following) by November
14, send you an e-mail requesting any additional information from the accounting system 2) by
November 21, send you any follow-up questions) by December 7, prepare a final report on their
assessment of performance and operations. Again, it has been a pleasure to talk with you and to
begin working together. If you need anything, please let me or the Team Manager know.

Best
Partner Smith.