PwC ARC

www.pwc.com

FY12 ARC Guidance Assurance Addendum

Confidential: This

ARC Guidance is

designed for HR and

ARC Chairs, ARC Panel

Members, and Coaches

at the Manager through

Managing Director

levels and is not to be

distributed further.

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Table of Contents

The Importance of the ARC ................................................................................................................................................ 3

Pre-ARC activities ................................................................................................................................................................ 4

Peer groups and experienced hires ............................................................................................................................... 4

Transfers, staff on tour, and national staff in the markets .......................................................................................... 4

Completing a comprehensive file review ...................................................................................................................... 4

Determining an RPR recommendation ........................................................................................................................ 4

Relative Performance Rating (RPR) guidelines ........................................................................................................... 6

Promotion recommendations ........................................................................................................................................ 6

ARC activities .......................................................................................................................................................................8

Summary of RPR considerations ..................................................................................................................................8

Summary of promotion considerations ........................................................................................................................8

Annual performance bonus consideration (for senior associates and above) ............................................................ 9

Post-ARC activities ............................................................................................................................................................ 10

Communicating ARC decisions while waiting for exam results ................................................................................ 10

Additional Guidance .......................................................................................................................................................... 10

Reference material/tools ............................................................................................................................................. 10

Appendix .............................................................................................................................................................................11

Assurance credential requirements for associates and senior associates ..................................................................11

Assurance credential requirements for managers and above ................................................................................... 16

FY12 required courses for core attest, PCS, Process Assurance, TS .......................................................................... 22

Excerpt from Tim Ryan's September 2011 communication regarding the assurance bonus program ...................26

ARC review drafting template ..................................................................................................................................... 27

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The Importance of the ARC

People are our greatest asset. They work hard and put in significant efforts, and the ARC provides each staff member with a comprehensive assessment of their performance and contributions to our practice and our firm each year. The ARC also provides staff with important feedback to assist with their development and progression with the firm.

As I've communicated previously, quality is and always will be our top priority. Over the past year, we have made some important changes to help further enhance quality across the practice. For FY12, we are making enhancements to the ARC process to more consistently identify, reinforce and recognize quality efforts. Through the enclosed Assurance ARC Addendum, we expect to drive consistency in how we evaluate our people's impact on the quality outcomes our firm, our clients and other stakeholders expect.

To drive a more focused and consistent approach to talent development and performance management, beginning with the FY12 ARC, we will consider performance and contributions through the lens of three primary areas of focus - People, Quality and Business. We have also used these categories to organize our revised Assurance Expectations Guide and our FY11 Differentiating Performance Factors Summary, which should be utilized in all aspects of the ARC to identify expectations of each staff level and gauge performance relative to peers.

Each of you - - our coaches, ARC panel members, ARC Chairs and our HR professionals - - play a critical role in executing this important process for our practice and our firm. And every staff member counts on us to execute the ARC with the highest degree of quality and integrity. Individually and collectively, you make a real difference.

As with any change, it will take some additional time for all of our people to understand the changes to the ARC guidance and its importance in driving quality. I ask for your support as we work through this year's ARC together. We're confident these changes will have a very positive impact in driving the quality focused behaviors we expect in all of our people.

The Assurance Leadership Team and I want to thank you in advance for the commitment and diligence you will contribute to this important activity.

Regards,

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Pre-ARC activities

Peer groups and experienced hires Experienced Hires - Consideration should be given to the acclimation and transition period for Experienced

Hires. They should be assessed against the expectations of a new hire at their staff level. This would mean that they should be evaluated across all rating categories; they should not automatically default to "high performer." However, if hired after January 1, 2012 and feedback is limited, it may be appropriate to assign a "0" rating for this initial period.

Transfers, staff on tour, and national staff in the markets Staff on assignments/tours outside of their market/practice for less than one year should be carefully

considered during the ARC review. The value gained from these assignments adds positive value and it is important to be sure that the file captures the staff member's performance for their time away from their "regular" role. These unique opportunities are consistent with the firm's strategy to expand the experiences and skills of each individual. Coaches should work closely with HR managers during pre-ARC consultations and the ARC process to confirm that staff are treated fairly and appropriately.

For staff on tour: home and host offices have responsibility and accountability for their staff on tours. Staff on tours (national and international) will be reviewed by their host office and the results of the ARCs will be communicated timely to home HR and coaches. It is important that Coaches and HR managers know who the coach and HR manager are for all inbound/outbound tour staff. Please pay particular attention to end of tour assignment plans, and reference the FY12 Global Mobility ARC Guidance for international tours.

Completing a comprehensive file review Following is guidance to supplement the information in the firmwide FY12 ARC guidance.

In preparation for ARC, coaches will conduct reviews of their coachees' files, consulting as appropriate with reviewers for clarification. Coaches should utilize the Assurance Expectations Guide and FY11 Assurance Differentiating Performance Factors Summary for guidance. Prior to ARC, coaches will meet with their respective HR manager to review their preliminary RPR recommendations and the differentiating performance factors supporting their recommendations.

Coaches must prepare a draft of the ARC Review prior to meeting with HR. The ARC Review should outline strengths, development points and key differentiating performance factors using the three areas of the form. The objective of the last section of the ARC Review included in the Annual Summary is to have a crisp summary statement to present during the ARC meeting, explaining the rationale for the rating.

Coaches should use the Assurance ARC Review Drafting Template when preparing their ARC Reviews, and should complete templates prior to the pre-ARC HR meeting. This template is similar to the ARC Review section of the Annual Summary in PC&D, and includes a section to document achievement of quality goals and expectations (see appendix). The template is to be used for ARC preparation purposes only, and coaches must complete the ARC Review section of the Annual Summary in PC&D (which is the official record of performance).

Determining an RPR recommendation Coaches should identify performance trends, consistent demonstration of skills, capabilities and behaviors and

impact on quality, people, and business:

– Quality: Knowledge, skills, and behaviors that have direct impact on work product quality such as technical knowledge and expertise, including credential and compliance requirements.

– People: Coaching, relationships, teamwork, communication, and talent development of others as well as self.

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– Business: Knowledge, skills, and behaviors associated with business management and business development including project management, engagement economics, proposals, and growth opportunities.

Development over the course of the year should be considered in determining the RPR, including progression and achievement of quality related goals such as compliance with credentials (CPA licensing, credential exam requirements), and completion of required courses and related competency assessments.

It is expected that "Top" and "Outstanding" performers will have demonstrated significant progress toward the following goals, which coaches should identify and summarize for the ARC review:

– Required Courses:

o HR will provide a summary of attendance at required courses and completion of related competency assessments, to be reviewed during the consultation meeting.

o All coaches should summarize the staff member's progress toward completion of all required courses and related competency assessments.

– Required Credentials:

o Coaches should have an understanding of their coachees' progression toward achieving credentials, and should review progress against credential goals as documented in their coachees' Success Plans.

o For associates who have not yet passed the primary credential exam, the RPR may be impacted (please reference full details of the policy in the appendix).

> Per the associate credential policy, third year (or later) associates failing to pass the exam may be rated no higher than "High Performer". The ARC should assess their overall performance and propose the rating as if their credential requirements have been met and the RPR will be adjusted as appropriate during the National post ARC review

> Following are requirements for associates to progress towards achieving their primary credential. These points should be considered in determining their overall performance rating. National will not adjust RPR based on these factors:

a. Has sat for each part of the exam that has not been passed a minimum of twice per fiscal year. b. Credential plans incorporated into their Success Plans until all exam and work office license

requirements are met. c. Created and maintained a CPA work plan in the CTS and updated the plan with sitting dates as

they are set and with results as they are received. Those sitting for exams other than the CPA are not required to maintain a work plan in the CTS.

d. Completed a minimum of 12 educational credit hours per fiscal year, if they currently do not yet meet education requirements to sit for the exam

o Managers who may not yet hold their primary credential due to an international transfer, are working on a new work office license, or are on a credential work plan due to a business unit transfer should be assessed for credential progress. In these cases, HR will review progress against credential work plan and consider accordingly when determining initial RPR.

o During consultation meetings with coaches, HR can utilize the CPA credential tracking system to review current work plans and confirm that exam dates are recorded.

Coaches should identify and be prepared to summarize differentiating performance factors:

– Coaches should utilize the Assurance Expectations Guide (in addition to What is Exceptional Performance) and review the FY11 Assurance Differentiating Performance Factors Summary with HR to assist with developing a starting point for FY12 RPR recommendations,

– The FY11 differentiating performance factors have been applied to the 5 point rating scale organized by area of impact: quality, people, and business. Actual differentiating performance factors for FY12 will depend on current performance and will evolve as feedback is reviewed.

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Relative Performance Rating (RPR) guidelines Relative Performance Rating Categories aid in providing consistent and fair performance management and

compensation practices. The goal of each overall market/business unit should be to follow the managed

distribution by level as outlined in the Assurance 2012 RPR Ranges chart below.

The managed distribution is set with the understanding that a percentage of both voluntary and involuntary turnover will to occur during the course of the year.

The managed distribution provides consistency in our approach to performance management and is the link to our pay for performance compensation strategy. The distribution consists of the target percentages that are used to determine overnight increases and bonus allocations. Distributions that are significantly skewed towards higher performance ratings will have less differentiation between awards and those skewed towards the lower ratings will have greater differentiation.

2012 RPR ranges Staff Level Top Performer Outstanding

Performer High

Performer Needs

Improvement Un-

Satisfactory

Project Team Specialists 18 - 22% 33 - 37% 33 - 37% 5 - 9% 2 - 5%

New Associate 8 - 12% 23 - 27% 53 - 57% 7 - 11% 2 - 5%

Experienced Associate 18 - 22% 33 - 37% 33 - 37% 5 - 9% 2 - 5%

Senior Associate 25 - 30% 32 - 37% 26 - 30% 2 - 5% 2 - 5%

Manager 25 - 30% 32 - 37% 26 - 30% 4 - 7% 1 - 2%

Director/Sr. Mgr 40 - 50% 34 - 38% 10 - 15% 1 - 3% 1 - 3%

Coaches must support recommended RPRs by documenting differentiating performance factors as identified in performance feedback, discussed during ARC and reflected in the ARC Review. Coaches should reference the Assurance Expectations Guide and the FY11 Assurance Differentiating Performance Factors Summary as a starting point. It is expected that for managers and above, those rated as "Top" or "Outstanding" performers will have at least one differentiating performance factor related to quality.

All staff, regardless of rating, should have a clear understanding of their performance, contributions, and areas of development.

– For staff rated as "Needs Improvement" coaches should clearly document areas for development. When creating an FY13 Success Plan, staff should document specific actions to address these areas for development.

– For staff rated as "Unsatisfactory," performance issue(s) should be clearly outlined in the staff member's ARC Review. If creating an FY13 Success Plan, staff should document a plan for improvement.

Promotion recommendations Promotion rates are anticipated to be similar to last year, with the promotion rate of associate to senior associate at

23%, senior associate to manager at 23%, and manager to director/senior manager at 20%.

Promotion to Senior Associate The anticipated tenure of associates being considered for promotion to senior associate is the completion of at

least three busy seasons. Associates recommended for promotion with fewer than three busy seasons need to be carefully evaluated to confirm that they have sufficient depth and breadth of experiences to assume the responsibilities and are expected to have a relative performance rating of "Top Performer".

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In addition to meeting credential requirements, promotion candidates will have demonstrated knowledge, skills, and behaviors related to quality. This includes but is not limited to technical auditing/accounting knowledge and the consistent delivery of accurate and high quality work products.

Candidates for promotion to senior associate that were hired after May 1, 2007 must adhere to guidance provided in the Assurance Credential Requirements for Associates and Senior Associates (Including Primary Credential Bonus) located in the appendix and on myKcurve. HR managers should clearly explain the credential requirements outlined in the policy to all coaches and the ARC chairs prior to the ARC meeting, including the section of the policy which addresses the impact to RPR for those staff who have not met the requirements.

Associates proposed for promotion need to pass their required credential exam and provide their HR representative with proof of exam results by June 15, 2012 in order for their promotion and pay to be effective July 1, 2012. Staff receiving exam results after June 15, 2012 will be promoted on the next PeopleSoft effective date. Promotions and pay increases will not be back dated to July 1, 2012.

Associates recommended for promotion to senior associate will have until August 31, 2012 to sit and pass their required exam. Promotions and pay increases will be effective on the next PeopleSoft effective date following receipt of exam results. Promotions and pay increases will not be back dated to July 1, 2012. The last available effective promotion date will be January 1, 2013. Promotions that are not effective by this date will be deferred to the next ARC cycle.

Promotion candidates to senior associate are expected to have completed all L&D required courses and related competency assessments for associates.

Promotion to Manager The anticipated tenure of senior associates being considered for promotion to manager is the completion of at

least three busy seasons. Senior associates recommended for promotion with fewer than three busy seasons need to be carefully evaluated to confirm that they have sufficient depth and breadth of experiences to assume the responsibilities and are expected to have a relative performance rating of "Top Performer".

To be eligible for consideration for promotion to manager, candidates must:

– Comply with the ARC eligibility guidelines outlined in the Assurance Credential Requirements for Managers and Above located in the appendix and on myKcurve.

– Have a proven track record of strong skills in the area of quality, managing business economics and developing our people. This will be reviewed during the pre-ARC consultation between the coach and HR.

– Need to clear both independence and credential requirements by June 15, 2012 in order for the promotion to be effective on July 1, 2012.

– If a license (not exam) or independence process/form is completed after July 1, 2012 the promotion will be effective on the next PeopleSoft effective date. The last available effective promotion date will be January 1, 2013. Promotions that are not effective by this date will be deferred to the next ARC cycle. This assumes all other requirements have been met. Promotions and promotional pay increases will not be back dated to July 1, 2012.

– Promotion candidates are required to complete the 8 required courses and related competency assessments in the senior technical series (ASATS) and are expected to have completed all other L&D required courses and related competency assessments for senior associates. Senior associates who have not completed all 8 courses may be promoted, but are required to complete them by December 31, 2012. Failure to complete these courses by the deadline will be a specific consideration in the overall performance evaluation during the FY13 ARC process. Beginning in FY13, senior associates must complete all 8 courses to be promoted to manager.

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ARC activities

Summary of RPR considerations

RPR Considerations Associates/Seniors

Content of PFFs and Performance Notes* Data point

Progress towards achievement of Success Plan goals as demonstrated in PFFs and Self Assessment*

Data point

Upward Feedback* N/A

Progress towards achieving primary credential Expected to sit for exams at least twice per year to achieve "Top" or "Outstanding" RPR. Third year (or later) associates failing to pass the exam may be rated no higher than "High Performer".

L&D required courses and related competency assessments** Completion expected to achieve "Top" or "Outstanding" RPR

Differentiating performance factors related to quality Demonstrated by meeting credential and L&D requirements

*as noted in the firmwide FY12 ARC Guidance

**see FY12 Required Courses in the appendix

Summary of promotion considerations

Promotion Considerations

To Senior Associate To Manager

Credential Passed primary credential exam Licensed in work office state or hold appropriate primary credential

L&D required courses and related competency assessments*

Expected that all required courses and related competency assessments have been completed

Required to complete ASATS by 12/31/2012 for FY12 and complete prior to promotion for FY13 and beyond; Expected that all required courses and related competency assessments have been completed

RPR "High Performer" or above. Those with less than three busy seasons as associate must be rated "Top Performer"

"High Performer" or above. Those with less than three busy seasons as a senior associate must be rated "Top Performer"

*see FY12 Required Courses in the appendix

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Annual performance bonus consideration (for senior associates and above) It is expected that we will have floor/minimum awards with the opportunity to provide additional discretionary

bonus dollars when appropriate. Feedback from the ARC process will be utilized by leaders to help determine the

allocation of discretionary bonus dollars.

Clearly capturing differentiating performance factors in the areas that impact quality, people, and business, is

critical in assisting with determining allocation of discretionary bonus dollars. Contributions and differentiating

performance factors that are distinctive within one's RPR category should be considered when allocating

discretionary dollars.

For example, it could be due to a one-time event that had a significant impact on quality, our people or our

business; a unique client situation that was effectively handled; technical skills that stood out or other skills,

capabilities, or behaviors that are distinctive within one's RPR group.

Consider the quality and financial performance goals shared by Tim Ryan that drive the bonus program as you

review and consider how staff members may have furthered our progress in achieving these goals (see excerpt from

Tim Ryan's September 2011 communication in appendix).

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Post-ARC activities

Communicating ARC decisions while waiting for exam results During the annual summary conversation, the Coach should advise the affected staff member of the credential

policy and the potential impacts on their rating and promotion. They can indicate to the staff that they were rated as "Top Performer" or "Outstanding Performer" and/or promoted but that the rating and promotion are conditional and will not be effective until passing results are received.

Additional Guidance

Audit transformation program Staff will be reviewed based on their ATP role and length of time on the project as outlined below:

ATP Core Team, ATP Sector Initiative Team, and GADM Core Team: Individuals working 100% on these teams will participate in a dedicated ATP ARC outside of their local market, following the ARC Guidance. Those members who reside in their local market team and have a client complement in their home market will participate in their local market ARC process. Market HR leaders will be provided with information on the role of the individuals from their markets on these ATP teams, and will be asked to make sure that the ATP work is properly represented during the local ARC process. In addition, it is strongly encouraged that the local coaches for these individuals be in regular contact with the ATP Partner with whom the individuals are working.

GADM and AURA Champions' will participate in their local market ARC process.

PFFs and Time allocation: GADM and AURA Champions' time will be processed as internal with credit, and therefore not included in utilization statistics. Please note the hours worked by the GADM and AURA Champions so that they are recognized for these hours. Champions should be encouraged to seek PFFs for their GADM or Aura work (either from Core Team members or local contacts), where applicable.

Delivery center (for GADM) Managers, senior associates and/or associates who are currently on a tour that is less than one year and will be

returning to their home office will be included in home office ARCs.

Managers, senior associates and/or associates who are currently on a tour of one year or more and will be returning to their home office will be included in the Delivery Center ARCs.

HR managers in the markets and the Delivery Center should confirm that staff on tour are covered in an ARC.

Reference material/tools Assurance Expectations Guide

Firmwide FY12 ARC Guidance Global Mobility Guidance

ARC Review Drafting Template

FY11 Differentiating Performance Factors Summary

L&D required courses and related competency assessments results

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Appendix

Assurance credential requirements for associates and senior associates (Policy effective April 1, 2012. This document supersedes any previous versions of the policy.)

Completion of a Primary Credential is a critical step in staff development, including evidencing our commitment to quality through consistent examination and certification standards; such exams include the Certified Public Accountant ("CPA"), Certified Information Systems Auditor ("CISA"), Certified Internal Auditor ("CIA"), Chartered Financial Analyst ("CFA") exam or other exam as approved by Assurance leadership. The policy outlined below describes the requirements and expectations related to Primary Credential requirements for consideration for promotion to Senior Associate, as well as the credential bonus award for achieving the appropriate credential.

I. Eligibility requirements for promotion to senior associate The progression from Associate to Senior Associate occurs following the demonstration of the required skills and

capabilities and includes the completion of the appropriate credential exam, as described in the Assurance

Expectations Guide for each staff level. In addition, following successful completion of the appropriate credential

exam, staff must seek licensure in their work office state as soon as all state requirements are met. All CPA credentials

should be submitted and kept up to date in the CPA Credential Tracking System ("CTS") which can be found on

myKcurve.

Much of this policy is written with the CPA Exam/License in mind. For those staff in Risk Assurance, TS and FS-BAS

who are required to pass an exam and earn a credential for promotion, the intent and basic guidelines of this policy

apply. Consult with your local HR Manager if you have any questions about this policy.

The Primary Credential Exam policy applies to new and experienced Assurance Associates with a

hire date of May 1, 2007 or later and is applied as follows:

Business Unit Group Exam Required for Promotion to Senior Associate

Core Attest and PCS All CPA Exam

Risk Assurance Process Assurance CPA Exam (Preferred Credential), CISA or CIA

Internal Audit CPA Exam (Preferred Credential), CISA or CIA

Governance, Risk & Compliance and IT&PA

No external certification requirement

TS CMAAS CPA Exam

Valuation Services* CPA Exam for staff providing accounting advisory services

FS BAS FSR* CPA Exam, Level 1 of the CFA Exam, MBA or Master’s degree in Finance, Quantitative Statistics, Financial Engineering, or Economics. For those with a hospitality degree, a State Appraiser Trainee License or Master's in Real Estate Finance

CFG* CPA Exam, Level 1 of the CFA Exam, MBA or Masters in Finance

AIMS 5 exams towards Casualty and Actuarial Society ("CAS") or Society of Actuaries ("SOA") certification

MIDA No external certification requirement

* Staff not performing attest services or support tasks may not be required to pass the CPA or other exam or hold a professional credential for

promotion. Consult with your HR Manager and Partner Leader to determine if this is applicable to you.

II. Exam completion, promotion eligibility and performance impact guidance It is expected that individuals will complete the appropriate exam and become licensed as early in their career as

possible. Having a credential early in one's career is a benefit to both the individual and the Firm.

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Within 60 days of hire date, each Associate must assess his/her eligibility to sit for the appropriate exam in his/her

work office state and the following actions must be taken:

1. Credential action steps must be included in each individual's Success Plan including key milestone dates (i.e. Becker or other review courses, exam sitting date(s), completion of education requirements, etc.).

2. Those sitting for the CPA exam should create a work plan in the CTS by answering the questions in the work plan form regarding education, exam completion status, experience, license eligibility and target completion date.

3. The action steps must be discussed with the individual's coach and HR Manager prior to plan sign-off.

Progression towards meeting credentialing requirements will be one of many elements considered when assessing

staff during the Annual Review process and may have an effect on performance ratings to the extent that education

and exam requirements are not met.

Upon being hired, associates fit into one of three potential scenarios depending on the requirements of their work

office state and the education level achieved and must meet the requirements as outlined below.

1. Individuals eligible to sit for the CPA exam (or other required exam) who have completed all work office state required education:

Exam Sitting Requirements

a. Sit for each part of the exam that has not been passed a minimum of twice per fiscal year. b. Enter credential plans into his/her Success Plan within 60 days of hire and obtain coach and HR approval.

Include credential plans in all subsequent Success Plans until all exam and work office license requirements are met.

c. Maintain a CPA work plan in the CTS and update the plan with sitting dates as they are set and with results as they are received. Those sitting for exams other than the CPA are not required to maintain a work plan in the CTS.

Promotion Requirements

a. Individuals are eligible for promotion if they have successfully completed all parts of the required credential exam by August 31.

b. Individuals who are awaiting exam results at the time of the ARC process or who plan to sit for the exam in July or August may be considered for promotion on a contingent basis pending passing results.

c. If passing exam results are received after July 1, promotions and any related compensation changes will be effective on the following PeopleSoft effective date, which is the 1st or 16th of the month following receipt of the results. Retroactive adjustments of promotions or related compensation increases will not be made.

Performance Rating Impact

a. If an individual does not sit for the exam as required, this will be considered during the Annual Review process and may negatively impact that individual's relative performance rating (RPR). Exceptions may be made in the case of approved leaves of absence (in this circumstance, the individual should consult with the HR Manager and Market Team Leader).

b. Individuals will be rated no higher than "High Performer" during the ARC process if they have completed three or more years experience (i.e. completion of 3 "busy seasons") or are an experienced hire or transfer to Assurance designated as a third year Associate and have not yet completed the required exam. "Top Performer" and "Outstanding Performer" ratings awarded by the ARC will be reinstated if passing exam results are received for exams taken before August 31. (e.g. The ARC recommends an "Top Performer" rating in May, but the rating is changed to "High Performer" because the exam is not completed. If the individual sits for the exam before August 31 and receives passing results, the "Top Performer" rating will be reinstated.)

2. Associates not eligible to sit for the exam in their work office state due to not meeting educational requirements:

Exam Sitting and Education Requirements

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a. Complete a minimum of 12 educational credit hours per fiscal year. b. Enter credential plans into his/her Success Plan within 60 days of hire including a detailed outline of the

remaining educational requirements and obtain coach and HR approval. Credential plans should be included in all subsequent Success Plans until all exam and work office license requirements are met.

c. Maintain a CPA work plan in the CTS. The work plan should be updated in the fall, by November 30, and in the spring, by April 30, with current education information. Once education requirements are completed, the work plan should be updated as exam sitting dates are set and with results as they are received. Those sitting for exams other than the CPA are not required to maintain a work plan in the CTS.

d. Upon completion of all educational requirements, sit for each part of the exam that has not been passed a minimum of twice per fiscal year.


a. Individuals may be considered for promotion if educational credits are being completed at a minimum of 12 educational credit hours per fiscal year.

b. Individuals are expected to pass the exam within 24 months of completing their educational prerequisites to sit for the exam and must sit for each part of the exam that has not been passed a minimum of twice per fiscal year.


a. Individuals will be rated no higher than "High Performer" during subsequent ARC processes if they have completed all education requirements but did not complete the required exam within 24 months of completing their education.

b. Exceptions may be made in the case of approved leaves of absence (in this circumstance, the individual should consult with the HR Manager and Market Team Leader).

3. Associates eligible within their work office state to sit for the CPA exam but have not completed work office state required education:

Note: This provision is only applicable in a limited number of states as of October 2011, including: Arizona,

Connecticut, Georgia, Kentucky, Massachusetts, New Jersey, New York and North Carolina. Staff should

review the CPA Coach on myKcurve for the requirements of their assigned work office state as requirements

may change from time to time.

Exam Sitting and Education Requirements

a. Complete a minimum of 12 educational credit hours per fiscal year until all educational requirements are completed.

b. Enter credential plans into his/her Success Plan within 60 days of hire including a detailed outline of the remaining educational requirements and obtain coach and HR approval. Credential plans should be included in all subsequent Success Plans until all exam and work office license requirements are met.

c. Maintain a CPA work plan in the CTS. The work plan should be updated in the fall, by November 30, and in the spring, by April 30, with current education information. The work plan should also be updated as exam sitting dates are set and with results as they are received. Those sitting for exams other than the CPA are not required to maintain a work plan in the CTS.

d. Individuals in this category may sit for the CPA exam prior to the completion of their education. If the exam is completed prior to the education, continue to complete the education requirements with no less than 12 hours per fiscal year.

e. Upon completion of all educational requirements, sit for each part of the exam that has not been passed a minimum of twice per fiscal year.


a. Individuals choosing to complete their education first may be considered for promotion if educational credits are being completed at a minimum of 12 educational credit hours per fiscal year and the individual sits for each part of the exam that has not been passed a minimum of twice per fiscal year upon completion of the education requirement. Individuals are expected to pass the exam within 24 months of completing their education.

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b. Individuals who pass the exam before completing missing educations credits may be considered for promotion if their educational requirements are being completed at a minimum of 12 educational credit hours per fiscal year.


a. Individuals completing three or more years of experience (i.e. completion of 3 "busy seasons") or are an experienced hire or transfer to Assurance designated as a third year Associate will be rated no higher than "High Performer" during the ARC process if:

i. The individual did not complete the required exam within 24 months of completing his/her education ii. Upon completing the required education, the individual has not sat for each part of the exam that has

not been passed a minimum of twice per fiscal year within the 24 months following the completion of the education requirement.

iii. Individuals choosing to complete education requirements first have not completed at least 12 credit hours per fiscal year.

b. Exceptions may be made in the case of approved leaves of absence (in this circumstance, the individual should consult with the HR Manager and Market Team Leader).

Credential requirements for Experienced Hires and Transfers

Within 60 days of date of hire or transfer into Assurance, each Assurance Associate must complete the requirements

as documented in the section "Exam Completion Guidance with Promotion Eligibility and Performance Reviews"

above. Experienced hires need to meet the requirements outlined above to be promoted to Senior Associate. It is

expected that experienced hires and transfers into Assurance at the Senior Associate level will have the appropriate

credential.

Credential requirements for Direct International Hires, International Transfers and International

Assignees who Localize

a. If the individual has a home country credential, the credential must be added in the CTS within 45 days of their hire date.

b. The individual must put a work plan on file in the CTS that outlines the quickest path to complete the CPA or IQEX exam. Work plan guidelines are as follows:

i. Outline all major milestones and target completion dates to achieve completion of the CPA exam within 2 years of hire date or localization date. Obtaining and maintaining the promotion is contingent on securing a U.S. credential within 2 years (or a determination by your local HR Leader and Market Team Leader that sufficient progress has been made toward that goal).

ii. Individuals should submit their transcripts for evaluation by an approved credentials evaluation service or to their work office state board within 45 days of their U.S. hire date. Since state regulations vary, the individual should consult CPA Coach or a CPA Licensing Compliance Group consultant regarding the appropriate process for his/her work office state.

iii. As soon as an individual's education has been assessed and any additional requirements identified, the work plan must be updated with additional details. Individuals are encouraged to consult with the Compliance Resource Center (877-815-8616) as he/she prepares the work plan to confirm the individual understands the steps and requirements for work office state eligibility. The revised work plan must be submitted in the CTS and reviewed by your local HR Leader. Generally, the update should occur no more than six months from date of hire/localization.

iv. International hires/transfers pursuing their work office license should only pursue their initial license in their work office state and should not pursue a work office license in any other state. For example: If your work office is Chicago, Illinois, you should not apply for initial licensure in Colorado. You may sit for the exam in another state prior to completion of educational credits if you choose to do so; however, you should not apply for licensure outside your work office state. In most cases you can transfer your test scores and apply for original licensure in your work office state. If you do choose to sit in a state other than your work office state, you should confirm the exam results will be

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accepted by your work office state. State regulations vary and not all states will accept the results of examinations from another state where the individual did not meet the educational requirements of the work office state at the time they sat for the exam. Before you decide to sit for the exam outside your work office state or consider applying for licensure outside your work office state, you must consult with the Compliance Resource Center (877-815-8616), to make an informed decision. This is a challenging area given the unique and varying rules of each state.

III. Secondary credentials:

The Firm recognizes that in some instances a second credential may be appropriate for staff development or to

support the staff's roles and responsibilities. If an individual would like to pursue a second credential, the Firm will reimburse the exam and licensing costs of the secondary credential with the appropriate approval of the Market Assurance Leader for staff in Core Attest, Internal Audit or Process Assurance or the Business Unit Leader for staff in PCS, IT&PA, TS, and FS BAS. Secondary Credentials are not eligible for an Assurance Credential Bonus.

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Assurance credential requirements for managers and above (Policy effective April 1, 2011. This document supersedes any previous versions of the policy.)

Overview Completion of a Primary Credential is a critical step in staff development, including evidencing our commitment to

quality through consistent examination and certification standards. In Assurance, to hold a position of Manager or

higher requires the appropriate credential. Eligibility for promotion to Manager in most groups is contingent on

having met specific credential compliance requirements. Outlined below is the specific policy for each group within

Assurance.

Much of this policy is written with the CPA Exam/License in mind. For those staff in Risk Assurance, TS and FS-BAS

who are required to pass an exam and earn a credential for promotion, the intent and basic guidelines of this policy

apply.

This policy is supplemental to the U.S. CPA Licensing Policy and provides additional guidance based on practice area

as well as information specific to international assignees, international hires and transfers, and individuals who have

recently transferred to a new work office state.

In addition to understanding the credential policies, please be aware that prior to promotion to Manager, candidates

will be required to complete an Independence review.

Consult with your local HR Manager if you have any questions related to this policy. Questions related to specific

state requirements for CPA licensure or other CPA tools and resources relevant to the licensing process should be

directed to the Compliance Resource Center at 877-815-8616. Information is also located in the Ethics and

Compliance site on myKcurve using the CPA Coach link or through individual state board websites which may be

accessed at www.aicpa.org under the heading Legislative Activities and State Licensing Issues.

Credential requirements

Core attest / PCS Managers and above in Core Attest and PCS are required to have a CPA License in his/her work office state.

Risk assurance Managers and above in Process Assurance, and Internal Audit are required to have a CPA License in his/her work

office state or hold their CISA or CIA credential.

Special note for Risk Assurance: Managers and above performing SSAE 16 (formerly SAS 70) work will need to

obtain and maintain a work office state CPA license in order to enter the partnership process. Therefore, it is advised

that all Risk Assurance Directors/Senior Managers performing this type of work obtain their CPA license.

Transaction services Credential requirements in TS depends on the nature and type of services provided to clients by the TS professional.

Credential requirements for staff by type of service provided are as follows:

1. Capital Markets & Accounting Advisory Services (CMAAS)

a. Managers and above are required to have an active CPA license in their work office state.

2. Valuation Services

a. Managers and above who provide accounting advisory services in conjunction with valuation services are required to follow the Core Attest CPA and promotion requirements.

b. Managers and above who provide solely valuation services are not required to obtain a CPA license. These individuals are encouraged to pursue alternate credentials. Please speak with your HR Manager for additional credential information.

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FS-BAS CPA licensing in FS-BAS depends on the nature and type of services provided to clients by the FS-BAS professional.

FS-BAS has communicated and posted specific policies related to requirements for promotion. Please review the

guidance below in addition to the guidance supplied in the specific FS-BAS policies.

Promotion requirements Promotees must receive their work office state license or other primary credential by the time promotions are

announced to be included in any written or verbal promotion announcements.

1. Individuals Who Meet Credential Requirements for July 1 Promotion

a. To be promoted effective July 1, an individual must have an active CPA license in his/her work office state or other primary credential by June 15 and clear all Independence requirements. Staff that join from international locations or have transferred recently may be promoted if they meet the requirements included on pages 5 and 6.

b. Definition of Work Office State

i. Work office state is the state of the PwC office where you are assigned. ii. Your work office state is not based on where you live or where your clients are located. If

you are unsure of your work office state, please contact your local HR Leader.

2. Individuals Who Do Not Meet Credential Requirements for July 1 Promotion Individuals who are not yet licensed in their work office state or who have not yet completed the primary credential may be considered for contingent promotion if one of the following criteria is met. Promotion and associated promotion increases may continue to be deferred through December 31. The last effective date for a promotion is January 1. Senior Associates receiving a license with an effective date after December 31 will be deferred until the next ARC cycle. The promotion and promotion increase will become effective in the payroll cycle following the issue date of the license or other primary credential and clearance of all Independence requirements.

a. The individual has passed all portions of the examination and has submitted his/her complete license application package to the state board of their work office state by June 30.

i. The promotion and associated promotion increase will be deferred until the work office state license is posted in the CPA Credential Tracking System (CTS) with the CPA Licensing Compliance Group.

b. The individual sits or is scheduled to sit for his/her final sections of the exam no later than June 30 and meets the state's requirements for licensure in their work office state. Following are the latest exam sitting dates based on exam offerings: CPA - May 31, CISA - June 30, CIA - June 30, and CFA - June 30. In this case, exam results will likely not be available prior to the ARC meetings. The following provisions will then apply:

i. An ARC recommendation to promote will be contingent upon pending passing results and receipt of the candidate's work office state license.

ii. Promotions will be deferred until the next ARC cycle for any individual who does not pass the full exam (all sections for the CPA).

iii. If the individual has passed the exam but the work office license is not yet posted in the CTS with the CPA Licensing Compliance Group prior to June 30, the promotion and associated promotion increase will be deferred until the license is posted in CTS.

c. Individuals who have passed all portions of the examination but are missing educational credits to meet their work office state licensing requirements must complete any outstanding educational credits no later than August 31. The following provisions will then apply:

i. A recommendation to promote will be contingent pending successful completion of all coursework by August 31 and timely submission of the candidate's work office state license application package.

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ii. If the staff has passed the exam and met the educational requirements by August 31, but the work office license is not yet posted in the Credential Tracking System (CTS) with the CPA Licensing Compliance Group, the promotion and associated promotion increase will continue to be deferred.

iii. Any individual not completing educational requirements by August 31 will be deferred until the next ARC cycle.

Licensed CPAs Per Firm Licensing policy, any individual who is a licensed CPA, regardless of where they are assigned within

Assurance, must hold an active license in his/her work office state. If you are in one of the groups identified

above and you hold an active CPA license in a state other than your work office state, this policy applies to you and

you must obtain a work office state license. Refer to the definition of Work Office State on page 3 under Individuals

Who Meet Credential Requirements for July 1 Promotion.

Specific promotion guidance for international staff and recent transfers The section below is applicable to various types of international hires and recent transfers as defined in each section.

Guidance applies to all Assurance practices as noted in the sections above. Please contact your local HR Leader with

any questions regarding applicability to your specific circumstances.

1. Inbound International Assignees currently on tour with a specific repatriation date (Strategic Deployed or Development Deployed) must meet the following promotion requirements:

a. If a credential is required in the home country, that credential is required to be on file for promotion in the U.S. The credential must be added in the CTS within 45 days of arrival.

b. The U.S. host HR Manager must have written confirmation of their eligibility for promotion in their home country, including confirmation if a credential is not required.

c. The U.S. host HR Manager must have written approval from the home office regarding the decision to promote the Senior to Manager.

Any questions regarding credentials required in your home country for promotion eligibility should be referred

to your Global Mobility Consultant.

2. Direct international hires and international transfers, including international assignees who convert or "localize", must meet the following promotion requirements prior to being considered for promotion:

a. If a credential is required in the home country, that credential is required to be on file for promotion. The credential must be added in the CTS within 45 days of arrival.

b. The promotion candidate must have a reasonable yet aggressive work plan entered in the CTS (see page 8 for important details) that outlines the quickest path to achieve a work office CPA license.

i. Work plan guidelines:

1. Outline all major milestones and target completion dates to achieve a work office CPA license within 2 years of hire date or localization date. If a U.S. credential has not been secured after 2 years and it is determined by your HR Leader and Market Team Leader that sufficient progress has not been made, your promotion may be revoked.

2. Have the plan reviewed and approved by your local HR Leader prior to submission. 3. Plans must demonstrate an aggressive approach to complete required steps, such as education or

experience. 4. Plans are entered in the Credentials Tracking System found on myKcurve.

c. Individuals should submit their transcript for evaluation by an approved credentials evaluation service or to their work office state board within 45 days of their hire date. Since state regulations vary, the individual should consult CPA Coach or a CPA Licensing Compliance Group consultant regarding the appropriate process for their work office state.

d. As soon as an individual's education has been assessed and any additional requirements identified, the work plan must be updated with additional details. Individuals are encouraged to consult with the Compliance

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Resource Center (877-815-8616) as he/she prepares the work plan to ensure the individual understands the steps and requirements for work office state eligibility. The revised work plan must also be submitted to your local HR Leader for review and approval. A final copy should be provided to the CPA Licensing Compliance Group through the CTS. Generally, the update should occur no more than six months from date of hire/localization.

e. International hires/transfers pursuing their work office license should only pursue their initial license in their work office state and should not pursue a work office license in any other state. For example: If your work office is Chicago, Illinois, you should not apply for initial licensure in Colorado. You may sit for the exam in another state prior to completion of educational credits if you choose to do so; however, you should not apply for licensure outside your work office state. In most cases you can transfer your test scores and apply for original licensure in your work office state.

f. If you do choose to sit in a state other than your work office state, you should ensure the exam results will be accepted by your work office state. State regulations vary and not all states will accept the results of examinations from another state where the individual did not meet the educational requirements of the work office state at the time they sat for the exam.

g. Before you decide to sit for the exam outside your work office state or consider applying for licensure outside your work office state, you must consult with the Compliance Resource Center (877-815-8616), to ensure you make an informed decision. This is a challenging area given the unique and varying rules of each state. Note: Please see important information in the section entitled Work Plans.

3. Recent* transfers or hires from another state who hold an active CPA License in the state where they previously resided/worked or where they were educated may be considered for promotion under the following parameters:

* A recent transfer is generally defined as someone who transferred September 1 or later in the current fiscal year.

a. Individuals who qualify for licensure in their new work office state should submit an application for reciprocal license prior to their transfer date but no later than 30 days from the transfer date.

b. Individuals who do not qualify for licensure in their new work office state and meet the following criteria:

i. Hold an active license in his/her previous work office state, or where s/he completed education; and ii. have a reasonable yet aggressive work plan to achieve their work office CPA license. (Individuals

are encouraged to consult with the CPA Licensing Compliance Group as they prepare their work plan to ensure the individual understands the steps and requirements for work office state eligibility.)

1. The detailed work plan should be approved by the local HR Leader in the new work office with a copy on file with the CPA Licensing Compliance Group via the Credential Tracking System. Individuals must notify the Compliance Resource Center (877-815-8616), of their status (the application submission date or a copy of their work plan where needed) within 30 days of their transfer date. Note: Please see important information in the section entitled Work Plans.

Work plans Direct international hires, international transfers, and recent transfers to a new work office state in all Assurance

practices required to have a primary credential are required to complete a formal detailed work plan in the CTS.

The section below describes the elements and expected progression of the formal work plan. Individuals in these

categories are the only individuals who may be considered for promotion based on compliance with other

credentialing/licensing requirements as defined below and acceptable progression of their work plan action steps.

The Credentials Tracking System has a specific Work Plan section in which staff will answer a

series of questions and enter all data and efforts toward achieving their CPA License. Acceptable

work plans conform to the expectations defined below in terms of timing and progression.

Who should complete a work plan? 1. Direct international hires/transfers that have a home country credential and:

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a. Are missing educational credits to meet eligibility requirements in their work office state; or b. Are not missing educational credits but need a reasonable period to complete the IQEX or CPA Exam and

acquire their work office state license.

2. Recent transfers to a new work office state if the individual does not meet the educational requirements of the new state and the individual holds an active CPA License in the state where he/she previously resided/worked or where he/she was educated.

3. IAS and TS Managers who were promoted prior to September 1, 2009 and do not yet hold a credential.

What constitutes a "reasonable work plan"? 1. Individuals eligible for a work plan must complete the appropriate education and examinations to qualify

for licensure in their work office state. Progress must occur under the following guidelines:

a. Individuals lacking educational requirements are expected to complete required coursework at a minimum pace of 3-6 credit hours per quarter (excluding the January - March busy season period) or a total of 12-18 credit hours per year.

b. Individuals lacking educational credits are expected to complete the US CPA Exam within 12 months of completion of missing educational credits. Direct international hires/international transfers who are not missing educational requirements to qualify in their work office state should complete the exam and apply for their work office license within 18 months of their hire/localization date.

2. Foreign accountants with a foreign accounting credential:

a. A work plan to achieve the US CPA is deemed reasonable if the individual:

i. Is eligible to, and plans to sit for and passes the IQEX at the next scheduled testing event, or ii. Is currently pursuing a US CPA license in their work office state as evidenced by a documented personal

work plan where:

1. Foreign education transcripts have already been evaluated by an approved credentials evaluation service or to their work office state board to determine if the individual qualifies to sit for the US CPA Exam in his/her assigned work office state;

2. An aggressive schedule is defined to complete all missing educational credits at a minimum pace of 3-6 credit hours per quarter (excluding the January - March busy season period) or a total of 12-18 credit hours per year;

3. A reasonable target date(s) is identified to sit for the US CPA Exam (dependent upon the number of educational credits needed); and

4. An aggressive target date is identified to apply for a work office state license upon completion of all requirements.

3. Recent transfer/hire from another state:

a. A work plan to obtain a work office state license is deemed reasonable if s/he already has a US CPA license issued by the board of accountancy in his/her previous work office state (or where s/he completed education) and does not immediately qualify for licensure in his/her new work office state, and is currently pursuing a CPA license as evidenced by a documented personal work plan where:

i. The individual does not have the appropriate credit hours to qualify for licensure; ii. The individual has enough credit hours to qualify for licensure, but is still missing specific courses

required by the state and knows exactly which courses to take in order to qualify for licensing (in some states it may be necessary for the individual to submit an initial application package). Please also see CPA Coach for your work office state where specific coursework requirements are identified);

iii. An aggressive schedule is defined to complete all missing educational credits with measurable milestone dates; and

iv. An aggressive target date is identified to apply for a work office license upon completion of all requirements.

4. Current IAS Managers who were promoted prior to September 1, 2009 should formalize a work plan that enables them to obtain a credential (CPA, CIA or CISA).

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5. Work plans on file in the Credentials Tracking System must be reviewed by the local Assurance HR Manager to ensure the individual’s plan clearly and specifically details all requirements necessary for the individual to obtain his/her work office license and that the approach is aligned with the most expeditious path to licensure. The Compliance Resource Center (877-815-8616) should be consulted where there are questions regarding the most expeditious path to ensure appropriate action steps are defined. CPA Licensing will monitor and report on work plan milestones. They may directly contact staff as deadlines near to ensure goals are met.

6. The local HR Leader should review and agree with the practicality of the individual's work plan and associated target dates. By signing off on the plan the local HR Leader is acknowledging the plan is reasonable and achievable. The plan must provide sufficient detail to enable assessment of completion against agreed upon activities and timelines.

7. In preparation for the ARC meetings, the work plans of direct international hires, international transfers, and recent transfers to a new work office state should be reviewed by HR Managers. Assurance Leadership - Assurance HR Operations Leader will also review and contact markets for updates on individual staff. An assessment of eligibility for promotion will be based on an analysis of progression against the targets defined in the section Specific Guidance relevant to Inbound International Assignees, Direct International Hires or International Transfers, and recent transfers or new hires from a different work office.

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FY12 required courses for core attest Partners Hrs Managers Hrs Seniors Hrs Associates Hrs

Year End Update for Partners / Managers

8 Year End Update for Partners / Managers

8 Year End Update self-study

4 Assurance 1 - new hires prior to 1st busy season

80

National Sector Conference

22 National Sector Conference

22 Leading Teams (Formerly QEM)

16 Making it Count (inventory observations) Prior to 1st busy season

3

Audit Quality Workshop

24 Audit Quality Workshop

24 Audit Quality Workshop

24 Assurance 2 – after 1st busy season

40

xLoS New Partner 22 xLoS New Manager (virtual and market classrooms)

21 Assurance New Senior Experience

24 Documentation Standards (Aura) PCAOB AS 3

3

Issue, Management for New Partners

8 Legal Issues Webcast (New Managers only)

2 Assurance Senior Associate Technical Series

Affiliated Entities (6 hrs)

Business Combination (6 hrs)

Equity Instruments (6 hrs)

Fair Value (6 hrs)

Fraud (7.5 hrs)

Income Taxes (6 hrs)

Revenue Recognition (6 hrs)

Stock Based Compensation (6 hrs)

Assurance 3 – after 2nd busy season

40

Professional Development (complete over 2-3 years)

Practicing Networking (8 hrs)

Practicing Conversations (12 hrs)

Practicing Negotiations (8 hrs)

Assurance 4 – after 3rd busy season

40

Engagement Quality Review AS7 (New Managers only)

1

Independence, Compliance and Ethics

2 Independence, Compliance and Ethics



2

Range of total hours

56-86 56-80 42-64 42-128

Programs noted in Black Italics will be delivered using virtual learning technology (eLearn, webcasts, virtual classrooms)

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FY12 required courses for private company services Partners Hrs Managers Hrs Seniors Hrs Associates Hrs

Year End Update for Partners / Managers

8 Year End Update for Partners / Managers

8 Year End Update self-study

4 Assurance 1 - new hires prior to 1st busy season

80

PCS National Conference

22 PCS National Conference

8 to 22

Leading Teams (Formerly QEM)


3

PCS Audit Quality Workshop

24 PCS Audit Quality Workshop

24 PCS Audit Quality Workshop

24 Assurance 2 – after 1st busy season

40



24 Documentation Standards (Aura) PCAOB AS 3

3

Issue, Management for New Partners

8 Legal Issues Webcast (New Managers only)

2 Assurance Senior Associate Technical Series

Affiliated Entities (6 hrs)

Business Combination (6 hrs)

Equity Instruments (6 hrs)

Fair Value (6 hrs)

Fraud (7.5 hrs)

Income Taxes (6 hrs)

Revenue Recognition (6 hrs)

Stock Based Compensation (6 hrs)

Assurance 3 – after 2nd busy season

40





Assurance 4 – after 3rd busy season

40

Engagement Quality Review AS7 (New Managers only)

1





2


56-86 56-80 42-64 42-128


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FY12 required courses for process assurance Partners Hrs Managers Hrs Seniors Hrs Associates Hrs

Risk Assurance Audit Quality Workshop

24 Risk Assurance Audit Quality Workshop

24 Risk Assurance Audit Quality Workshop

24 Risk Assurance 1 – new hires

80




3

National Sector Conference

22 National Sector Conference

22 Leading Teams (Formerly QEM)

16 Risk Assurance 2 – after 1st busy season

40





Documentation Standards (Aura) PCAOB AS 3

3

Risk Assurance 3 – after 2nd busy season

40

Legal Issues Webcast (New Managers only)

2

Independence Compliance and Ethics




2


44-70 56-64 24-46 40-85


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FY12 required courses for transaction services Partners Hrs Managers Hrs Seniors Hrs Associates Hrs

Confidentiality and Insider Trading (new joiner)

1.25 Confidentiality and Insider Trading (new joiner)



1.25





2


3.25 3.25 3.25 3.25


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Excerpt from Tim Ryan's September 2011 communication regarding the assurance bonus program The new bonus program is intended to recognize the accomplishments, contributions and performance of each of you

as individuals and as part of the overall Assurance team. You will be rewarded through a combination of Credential

Bonus, Contribution Award, and Annual Performance Bonus. These different bonus elements create an overall bonus

plan that is tailored to each staff level, which results in a more practical and personal approach to our overall bonus

strategy.

Early in your career you will be eligible to receive bonuses more frequently through the semi-annual Contribution

Award and the Credential Bonus. As you advance with the firm, your incentive potential will increase as a percentage

of your base salary through the Annual Performance Bonus.

Funding for the Contribution Award and Annual Performance Bonus will be based on the quality results and financial

performance of the Assurance practice. Each of you has the ability to influence the achievement of our goals, which

will in turn enhance our service delivery to clients, our quality and, ultimately, the success of the firm. Specific quality

and financial performance goals include:

Quality performance goals

Inspections: Reduce the number and severity of non-compliant audits identified through inspections

Training: Complete participation in all required training, including passing applicable assessments

Planning: Improve the timing of planning and phasing of our audit work, including the appropriate use and leverage of our delivery model.

Financial performance goals

Revenue: Achieve our annual revenue budget, which includes a 4.9% revenue growth target

Contribution Margin: Achieve our contribution margin budget

Cash Collections: Achieve our monthly cash collection plan

Achieving our quality and financial performance goals will require both an individual and team effort with all of us

working together. Reaching our quality goals will require staff to continue to focus on our compliance with auditing

standards, concentration on continuous improvement and enhanced management of all engagements. Meeting our

financial performance goals will be dependent upon each staff charging all their time and billing timely for all client

services.

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ARC review drafting template

Annual Summary - ARC Review Section Draft (for Assurance)

This is a template to assist with preparing the ARC Review Tab section of the Annual Summary prior to inputting into PC&D and is not to be shared with staff. This is to provide a consistent review and presentation of performance files for the Assurance Practice. Final review will be captured in PC&D.

Note: each comment section of this form in PC&D has a maximum character count limit of 1,500. To review the character count for each section, highlight the appropriate text and click Word Count from the Review Tab on the above toolbar.

Name: Click here to enter text. Staff Level: Click here to enter text.

Achievement of Quality goals and

expectations: Information to be shared

during ARC panel. Feedback to be incorporated

as appropriate in one of the following sections.

(note: this section is not part of the PCD

system)

Credential:

Choose an item.

Required Courses:

Choose an item.

Achievement of quality goals (reference Success Plan):

Key strengths and accomplishments:

Outline significant contributions and

accomplishments including impact on quality,

people, and business.

Areas for growth and development:

Highlight areas for development and continued

growth. Consider areas of quality, people and

business.

Relative Performance Rating Supporting Comments: Indicate how performance surpassed, fell below, or was aligned with peers and expectations. It is expected that ratings of "Top" or "Outstanding" performers are supported with at least one quality differentiator

Proposed Relative Performance Rating

(RPR)*

Indicate initial proposed RPR

For "Top" and "Outstanding" performers at

the manager and above levels: Please choose

at least one defining skill category that was the

primary differentiator(s) in determining the

RPR

RPR:

Choose an item.

Skill Category:

1.Choose an item.

2.Choose an item.

3.Choose an item.

Recommendation for Promotion

(yes/no)* - for client service only

Choose an item.

* Not an editable field in PC&D - this will be uploaded to the summary in PC&D once approved in PeopleSoft eCompensation.

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Skill Categories (current technical assessment from PFF)

Accounting & Technical Knowledge: Demonstrates an understanding of accounting literature (including

specialized or industry related) and applies such knowledge in a practical manner to client, as well as, other situations

Familiar with current technical developments; articulates potential implications; performs thorough and accurate research; effectively uses technology to research and analyze issues

Demonstrates understanding of unique industry business climate and specific accounting and/or specialized practices

Demonstrates an understanding and appropriately applies systems and controls knowledge

Understands generic business and IT general controls, as well as, specific ERP and automated controls as applicable

Auditing and Assurance Skills: Demonstrates an understanding of and familiarity with the concepts

within the PwC Audit and US GAAS (or other relevant industry specific standards of practice)

Critically evaluates results of audit procedures and assess impact on overall audit strategy.

Applies a high degree of professional skepticism

Demonstrates excellent documentation skills Applies appropriate methods for data and evidence gathering

Demonstrates skills regarding substantive test procedures and controls knowledge

Business Knowledge and Knowledge Sharing: Develops and applies industry and business knowledge Demonstrates knowledge and understanding of clients' business

processes, systems and controls environment Effectively leverages knowledge management tools and databases Brings thought leadership to client issues and records solutions in the

firms knowledge management tools Brings insights and identifies opportunities by leveraging previous

experiences Understands the client's technology, including platforms, applications

and databases as applicable Issues Management: Demonstrates the ability to manage timelines, client expectations and

different viewpoints to effectively resolve issues Listens well and is able to articulate viewpoints with empathy

Fosters collaborative discussion; seeks other viewpoints and effectively leads discussions

Explains the process we are using and keeps clients informed continuously

Relationship Management/Networking: Makes quality contributions to our delivery of the three client principles

Builds strong and deep relationships with clients and within PwC Viewed as a credible and trusted member of the team and a trusted

resource to clients Understands and navigates unique client cultures; appreciates and

understands cultural differences Develops and leverages a broad network of PwC resources to help solve

client or project related issues Develops relationships with individuals, including those outside of the

core finance function Seeks and obtains feedback from clients on performance and value

delivered Communication Skills: Exhibits confidence in interactions Demonstrates empathy and sensitivity to the audience's perspective

Expresses thoughts clearly and succinctly; listens well

Tailors communications for different audiences; makes technical points understandable

Demonstrates ability to negotiate effectively

Responds quickly and thoughtfully Effectively contributes to group discussions

Business Development: Exhibits knowledge and understanding of PwC's business including

xLoS and C2 focused services Understands needs of clients and potential clients and identifies

appropriate firm service offerings Drives and/or participates in targeting and proposal activities as

appropriate for staff level Shares knowledge and skills to assist with the development of new

business Utilizes knowledge of clients' business and/or leverages professional

network and relationships to identify additional opportunities to deliver firm services to new and existing clients

Efficiency and Responsiveness: Demonstrates ability to effectively manage time, leverages staff abilities,

and uses technology to improve efficiency Responds well to pressure, handles multiple tasks effectively and

balances multiple priorities on a frequent basis Committed to doing things right without exception; doesn’t take short

cuts; self-starting; self-confident and enthusiastic Actively influences tasks and events to achieve appropriate goals Available when needed; makes each client feel as though they are the

most important Reacts quickly to both internal and external requests; consistently meets

deadlines Coaching & People Development: Committed to executing on the firm's people strategy; is viewed as a

valued coach and mentor Takes an active role in the coaching and evaluation process; gives honest

and candid feedback in a timely fashion; makes effective coaching a top priority

Active participant driving people initiatives Seeks and obtains quality feedback and incorporates development

points to enhance performance Actively shows appreciation for efforts and successes

Teamwork: Contributes to the overall effectiveness and success of the team

Promotes a shared understanding of priorities, goals, and results through frequent interaction with the team

Fosters an environment in which all team members feel comfortable

Inspires team members to do their best Utilizes and leverages team members to manage and resolve issues

Demonstrates an interest and commitment to operations of the team

Makes decisions that serve the best interest of the overall market team above that of personal interest

Supportive of team members; willing to assist others to achieve overall team goals; keeps team members informed and up to date on activities

Takes ownership for coaching and developing other team members; provides an excellent role model for the team

Engagement/Project Management and Administrative Capacity: Demonstrates organization and project management skills necessary to

effectively run or contribute to running an engagement or project Proactively manages economics; staff assignments/responsibilities are

clear and well understood; ensures a good understanding of time incurred and captures information necessary to resolve any overruns

PFF's are initiated and completed in a timely manner; engagement administration and risk management activities are thorough and completed timely

Challenges Conventional Thinking/Continuous Improvement: Contributes new thinking to group discussions and encourages others to

actively think of new approaches Demonstrates innovation

Exhibits intellectual curiosity; is not constrained by past practice

Considers new ways to enhance efficiencies to promote operational excellence

PwC ARC

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Transcript of PwC ARC