1. IRS Audit… Say What ??? OKLAHOMA ASBO OCTOBER 1, 2014

2. Notification received – August 9, 2013 (by telephone and fax) Examination date to begin – August 19, 2013 at 10:30 am * The purpose of this initial appointment is to meet with you and any officials you designate, to discuss the purpose and scope of the examination, and gather information about your government entity Form 4564 – Information Document Request, please provide the following: 1. Authorization and Declaration Form 2. Organizational chart for calendar year 2011(and current, if different) including identification of your principal executives 3. Minutes of the meetings of the Board of Trustees for calendar year 2011 4. Audited financial statements covering calendar year 2011 5. Independent auditor letters to management and internal auditor reports to management relating to calendar year 2011 6. Chart of Accounts including a description of each account (e.g. accounting manual) in use during calendar year 2011 7. Copies of all employment contracts including, but not limited to, individual executive officer contracts and union contracts in effect during calendar year 2011 8. Copies of all termination agreements where payments were made in 2011

3. Summary of documents requested for review: 1. Payroll – W2s, W3s, W4s, 941s, a list of all employees, 5 highest paid employees, payroll summaries, employees covered by the retirement system,… 2. Accounts Payable – vendor information/print-out (name, address, TIN, 1099 indicator), policies, procedures, manuals, W9s, and 1099s (submitted for this year) 3. A list of all fringe benefit plans, policy on employer-owned vehicles, policy on providing housing to staff, copy of all written policies 4. A list of all retirement plans and benefits, copies of all employee handbooks, total amount of employee contributions to retirement plans, copies of early retirement incentives, severance pay, vacation/sick leave conversion plans,… 5. 218 Section Plan-Social Security Act – “Plan for extending benefits of social security act to school district employees” ** TPS original agreement was signed January 1, 1957 **

4. Review – - Payroll records - Accounts Payable - W9s, 1099s, and CP2100 notices Additional Review – - Sampling of reimbursement forms (3 months) from General & Activity funds, forms used and the Board policy related to reimbursement - Sampling (6 months) of “clothing” and other items paid from General & Activity funds *De minimis - a Latin expression meaning about minimal things - Fueling process and related records kept for District fleet and employee contracts authorized to drive school vehicles (to home) - Travel policy & overnight/meal reimbursement procedures - Gift Cards - Review of our procedure manual - board approved

5. Required actions – - Submit corrected 2010, 2011, and 2012 -1099s and 1096 forms - SS & Medicare tax withholding, unless there is an exemption, all compensation is subject to SS & Medicare tax Review and acceptance of the examination report – dated December 19, 2013 Summary of Employment Tax Examination – received January 14, 2014 Publications and Forms – - Publication 1281 (yellow booklet) Backup Withholding for Missing and Incorrect Name/TINs - W9, 1099, 1096, 945, and CP2100 “B” notices – General instructions and forms - www.irs.govwww.irs.gov

6. “It's just that in the Deep South, women learn at a young age that when the world is falling apart around you, it's time to take down the drapes and make a new dress.” ― Karen Marie Moning, Faefever Karen Marie MoningFaefever “Don’t wonder why people go crazy – wonder why they don’t” – Meredith Grey, Grey’s Anatomy Questions ?