Co-Sourcing and Outsourcing of the Internal Audit Function

1. Co-Sourcing and Outsourcing of the Internal Audit Function Roundtable Discussion of Strategic Alternatives October 23, 2008

2. Today’s Discussion Emerging role of Internal Audit Success factors and reason to source Internal Audit sourcing alternatives Business Cases About Jefferson Wells Q & A

3. Emerging Role of Internal Audit

4. Emerging Role of Internal Audit Governance structure, functional committee set up, policy setting management of business riskandParticipate of strategic planning Information Protection, accounting and operations control

5. Success Factors and Reasons to Source

6. Success Factors “Sourcing” Internal Audit works well when the following conditions exist: • The mission is clearly articulated and objectives are mutually agreed upon • Internal Audit is considered important • Budget constraints drive need for flexibility • Rapid changes in the business • Turnover limits in-house resources • Specialized skills are necessary • Technology enhancements drive efficiency • Geographically disbursed operations • The investment is reasonable • Teaming approach

7. Why Leading Organizations Are Sourcing • Allows management to focus on core competencies • To acquire needed skills • Subject matter or Systems expertise • Geographic needs • Innovative approaches • Need for flexibility regarding cost structure – variable vs. fixed cost • Lower net cost, i.e., “value for money” • Access to technology/knowledge repositories • Talent Attraction / Retention / Total Life Cycle Hiring Costs

8. Internal Audit Sourcing Alternatives

9. Sourcing Continuum – Sourcing Alternatives

10. Full In-House Model

11. Co-Sourcing Model

12. Full Outsourcing Model

13. Business Cases

14. Our Success Stories

15. Our Success Stories

16. About Jefferson Wells

17. About Jefferson Wells • Founded in 1995 as Audit Force, to be credible alternative to Big 6 firms for Internal Audit Services • Name changed to Jefferson Wells in 1999. Initial concept expanded to include Finance and Accounting, Technology Risk Management, and Tax • Company acquired by Manpower in 2001, to be run as a wholly owned subsidiary • At present, 2500+ professionals based out of 54 offices located in 9 countries around the world. • Average experience level is almost 18 years; minimum experience level is 5 years • To date, we have served more than 4700 clients (including 50% of Fortune500) and performed work in 30+ countries

18. About Jefferson Wells Asia • Hong Kong office was set up in 2007 as regional hub • Current client engagements include locations in Hong Kong, China, South Korea and Japan • Regional industry experience include banking, insurance, high-tech, professional services, automotive, manufacturing, consumer products • Main focus in Finance Operations and Internal Audit & Controls Solutions • Existing capabilities include, but not limited to, the following: • Internal Audit Outsource/Co-source • Contract compliance & cost recovery audits • SOX compliance • Regulatory compliance • Policies & procedures development • Financial process improvement • Shared services center • Interim professional • Investment accounting • Project management • Accounts reconciliation

19. Jefferson Wells Model • No attestation work – avoids conflicts of interest • Hire only Experienced Professionals – no trainees • Salaried Professionals with deep industry and/or public accounting backgrounds • Extensive skill sets and cross-functional abilities • High Value Proposition • Flat, local, team based business model with no partnership overhead • Highly competitive rates representing superior “value for money” • Enterprise wide sharing of knowledge/best practices • Focus on client needs – and client success • Results-Driven • Executing on our business model leads to positive references and additional business opportunities

20. Questions/Discussion