BSD/Pinnacle Solution Call for BDE’s

1. BSD/Pinnacle Solution Call for BDE’s September 25, 2002

2. Agenda • Introduction (10) Roger West & Laura Havrilla • Pinnacle Depot Review (20) • Depot and ABAS Sandi Coen • Tax James Marshall • Priority Services • Highest Priority Services (30) James Marshall (Tax) Mark Kirstein, Susan Davies (ABAS) • Other Priority Services (10) James Marshall (Tax) Laura Havrilla (ABAS) • Preferred Provider Matrix (5) Laura Havrilla • BDE Feedback and Next Steps (15) Roger West

3. Sales and Business Development (SBD): Enabling Transformational Growth Tax - Value Proposition I SBD Mission: To create a sales culture and a sales organization that will enablePwC to be the best at delivering value to the market and to be paid for that value; and to achieve dominant market share by developing profitable long term relationships. Drivers of Change Enablers Results 2003 Goals Structure • Sarbanes Law • Evolving market needs • Robust PwC revenue goals • Inconsistent SBD processes XLOS • Solutions development • Teaming • Targeting • Sales approaches • Follow-up Business Solutions Development High profitability PwC Market Leadership Maximum sustainable growth Client satisfaction Leading SBD culture Inform - Current Audit Clients Preferred Provider: Extend penetration Market Sales & Business Development Partners (MSBDPs) Sales Support Sales - BDE’s

4. Sales and Business Development (SBD): Enabling Transformational Growth Tax - Value Proposition I Business Solutions Development (BSD) Benefits to BDE’s: • One source to access Value Proposition and Key Contact for Scope of Firm Services – Pinnacle Depot • One source to access priority non-audit services/solutions – Pinnacle Depot • ABAS: working across industries and BAS Units to identify priority non-audit services; Complete Pinnacle Solutions as appropriate and include in Database • Tax: Database includes completed priority solutions tiered by priority. • Preferred Provider Targets linked to priority Pinnacle Solutions • Access and support - Concept One Tool Mission: Provide objective expertise in business strategy, development, and commercialization to enable businesses to optimize revenue through successful solutions. Scope: Full Development Process –Development of new solutions beginning with Idea Generation through Commercialization of existing selling priorities. Current Focus: Sarbanes and firm priorities (Inform & Preferred Provider)

5. Pinnacle Depot Review

6. Highest Priority ABAS and Tax Solutions • Tax: • SFAS 123 • International Assignment Solutions • Tax Efficient Internal Debt • ABAS • Security Framework Gap Analysis (FGA) • HIPAA • SmartClose

7. Electing SFAS 123 To Expense Stock Options and other Stock Awards Issues • Lawmakers are considering how companies account for stock options • Companies are considering voluntarily expensing stock options under FAS 123 to boost investor confidence • Many companies do not understand the method for valuing stock options using “fair value” or potential impact to financial statements Action Analyze a company’s historical information, future expectations and other analytic information to assist our client in selecting the assumptions used in FAS 123 to value its stock options. Impact • More reasonable valuation of option value and the potential impact on financial statements • Increase shareholder confidence and align the company with industry trends

8. International Assignment Solutions Issues For the world's leading organizations, deployment of talent is key to success. Whatever the mission - sharing knowledge, implementing management processes, expanding business into new territories - assignees provide the fuel for global growth. And the International Assignment Solutions (IAS) practice of PricewaterhouseCoopers has developed the full range of expertise necessary to plan, implement, manage and support the entire assignment process. Action We collaborate with assignment program leaders to achieve their key goals. These include: • Global tax compliance and cost reduction • Effective tax planning and risk management • Design and implementation of software programs to support the international assignment process • Development of global assignment policies that combine efficiency and cost-containment with corporate policy • Assistance to HR in administering their international assignment program Impact Our services range from the most fundamental to the most strategic, from hands-on to web-enabled. Our services help clients contain costs, reduce taxes, manage risk, and retain and reward assignees.

9. Tax Efficient Internal Debt (Pinnacle Idea # 1686) Issues • Many companies have profitable foreign subsidiaries with high tax rates • Companies may have foreign tax credit (FTC) limitations which make repatriation of funds difficult • As a result, companies have a high structural tax rate (STR) Action Phased approach to reduce STR by identifying subsidiaries that have the capacity to take on additional debt, creating internal debt to increase deductions, and utilizing excess FTCs to facilitate repatriation without double taxation Impact • Reduced overall STR • Improved FTC utilization • Elimination of double taxation resulting from repatriation • Increased earnings per share

10. Security FGA Value Proposition Issues • Increase in security related incidents • Increased regulatory requirements around security • Increase use of technology solutions to improve organizational performance • Reactive Security programs that are not aligned with the business strategy Action A strategic evaluation and assessment of client’s current security infrastructure as compared to PwC recommended practices that provides clients with a quick and effective analysis of the current state of their security strategy and a roadmap to address in the short, medium, and long term. Impact • Helps management to focus resources • Enhanced security function • Aligned and rationalized security infrastructure • Reduced exposure to information security risks

11. HIPAA Value Proposition Issues • HIPAA requires employers with self-funded health benefit plans to implement policies and procedures around use and protection of information • Requirements not a focus of most employers, and HIPAA compliance not included in most employers’ core skill sets Action • Assist in HIPAA implementation, from strategic planning through assessments to training and other projects to implement HIPAA’s rules. • Assessments are structured to identify and design solutions that allow the employer to fulfill its overall responsibilities, minimize the amount of time and effort needed to be spent, and employ detailed risk assessment and overall cost variables in decision-making process. Impact • Compliance with the law. • May minimize costs of compliance and lead to cost-reducing changes in benefit design or administration.

12. SmartClose Value Proposition Issues • Sr. Management under pressure to improve financial reporting process • Internal forces precipitating change • External forces driving changes reducing time allowed to file 10-K and 10-Q reports. • Investor and public demanding greater transparency in reporting. Action • Assist clients in assessing, designing, and implementing changes to current closing and reporting processes. • Focus on: understanding current processes for developing estimating techniques, consolidating activities, developing performance metrics, and enhancing existing IT capabilities. • Deliverables include gap assessments with high level recommendations, detailed implementation plans, and assistance in actual implementation and remediation. Impact • Helps clients enhance ability to meet reporting regulations and public expectations • Improves organization’s ability to prepare, explain, and analyze variations from expectations • Bolsters client’s facility for planning and budgeting with improved processes.

13. Other Priority Solutions • Tax • FEDERAL: R&D, TCA, Optimizing F/A Depreciation • SALT: Multi-State Tax Credit Review, RITA • HRS: CDHC, QRIF • GS: First Sale, HQ/Mngt Cost Analysis • ABAS • GRMS (Risk Management Advisory Services): CPI (Compliance Process Improvement), EWRM (Enterprise-wide Risk Management) , IAS (Internal Audit Sourcing Solutions) • TICE BAS Priorities: BPM (Broadband Profitability Maximizer) , ePM (E Profitability Maximizer), TRM (Telecom Revenue Maximizer) • TS (Transaction Services): Sell-Side Services

14. Preferred Provider Matrix

15. Feedback and Next Steps