New Audit Compliance Methodology

These processes have been developed to address instances where TAB rules governing the use of DEC are not being followed.

Sanctions

Proper application of sanctions as a deterrent to non compliance will be a critical part of the new compliance methodology. Sanctions for non compliance will not be applied for any offenses uncovered by these audit methodologies for the first six months of 2007. This time period will be used to evaluate the new methodologies. The Audit Process & Procedures Committee will have a recommendation on sanctions for the May Board of Directors meeting.

Though specific sanctions will not be applied for six months these audits do count against how sanctions will be applied relative to repeat offenses. Also periodic progress reports will be made to the Audit Process & Procedures Committee and also to the Board at the May Board of Directors meeting.

The new compliance methodology has three parts: the proposal review, field audits and complaint processing.

Proposal Review- The purpose of this procedure is to verify that only TAB audited plants are using DECs and that member plants are using “current year” DECs.

Process overview: Buyers will be contacted by TAB and asked to provide proposals they have received. TAB will compare proposal DECs to what is currently listed on www.tabonline.com. Discrepancies would be investigated and reported to the buyer submitting the proposal. There will also be a compliance report, including the results of the proposal reviews, report made at regularly scheduled Board meetings.

Method Details: TAB will contact every TAB member buyer two-three times annually and ask for a random sample of three proposals, each one for a different media company.

TAB will look up the DEC information in the TAB database and note any discrepancies. If there are anomalies TAB will contact the plant first for an explanation and then contact the submitting agency with the results of the audit as well as with the plants explanation.

The plant would have two weeks to respond to TAB’s inquiry before the results are sent to the submitting buyer without the plants explanation. The plant is required to make immediate corrections to their database. TAB will also follow up with the plant one month later to assure that the proper changes have been made. They also would be put on the list for field audit.

Non member plants using DEC on their proposals will be contacted by TAB.

Field Audits- The Purpose of this audit is to insure that plant inventory information provided to the TAB is correct.

Process overview: The role of the field audit is to assure that the inventory data supplied by the plants to TAB is compliance of media companies through the adoption of effective methods to identify violations.

We will ask independent audit suppliers to audit 3% of a market’s inventory. The 3% sample size will be reviewed and possibly adjusted based on audit results over the next six months to one year. We will also investigate the establishment of a minimum sample size to be applied to smaller plants so their sample will be meaningful.

Field audits locations will not pre-announced. For the first year we will focus on the top 10 markets. Specifically we will audit 5 of the top 10 markets and 2 out side the top 10. After that, depending on budget we will probably do 10-20 markets per year. Random market selection will be built into the process over time. Markets will be selected by TAB using the following factors in no particular order of importance:

1) existence of multiple TAB vendors in the market
2) size of road
3) road type
4) clutter level
5) secondary count stations already exist
6) problem markets

TAB will select the boards to be audited with input from the independent auditor using the TAB market list. The sample will be geographically dispersed. The auditor will have usable copies of this list but will not be allowed to share the list outside of its own company under any circumstances.

When the field auditor evaluates a board, he/she will consider the following variables:

1. illumination
2. correct count station assignment
3. secondary counts are correct
4. location description accuracy
5. media type
6. missing inventory
7. obstructions*
8. whether sign is parallel

Please see appendix one for a more complete description of errors.

*The inclusion of obstructions as an error is being discussed by the Audit Process & Procedures Committee. Until the Committee makes a ruling TAB will collect data on obstructions but any errors found, based on the current criteria will not count against the audit score.

The auditor will be required to take a photo at each location for quality control purposes.

All reports will be reviewed by the TAB and summary reports will be provided for plants review. Over the next six months, the process will be evaluated. No sanctions will be applied against non-complying plants during this period. The Audit Process and Procedures Committee will assess the results of the audits and recommend appropriate sanctions to the Board of Directors.

Complaint Processing- If a complaint is rendered against a specific operator(s), all issues should be submitted to TAB in writing with proof. Proof can take the form of pictures, proposals, or any other official documentation underscoring said complaint. TAB at its earliest convenience will launch an investigation of the complaint under rules of full disclosure. The complaint will be processed as follows:

1. Notify the operator in writing that a complaint has been rendered against them and state the complaint. The identity of the complainant cannot be kept secret.
2. TAB will investigate the complaint
3. TAB will notify the complainant and Board of the results of it s investigation.

TAB reserves the right to start an investigation if it has reason to believe there are grounds in the absence of a formal complaint. If there is a violation the results of TAB’s investigation will be shared with the Board.

TAB will develop a special complaint filing module on its website www.tabonline.com .

Appendix 1: Definition of Errors

Illumination- Checking if the board had lighting fixtures.

Correct Count Station Assignment- Is the panel assigned to the correct count station. An incorrect geocode or location description can cause wrong assignments.

Secondary Counts- Are claimed secondary counts legitimate? The parameters used were as follows:

Bulletins- Secondary exposure must be within 250’ of the facing
30-Sheets- Secondary exposure must be within 150’ of the facing
Eight-Sheets- Secondary exposure must be within 50’ of the facing
Shelters- Secondary exposure must be within 25’ of the facing

Location description accuracy- Are descriptions plant providing accurate and complete

Media Type- Is the correct media type listed in the database. We have had some issues with conversions.

Missing Inventory- Are there units listed in TAB’s database that were not found in the field?

Obstructions- Are the inventory blocked by trees or buildings? The facing was considered obstructed if 1/3 or more of its facing was blocked. The facing must be unobstructed for at least:

A unit was considered in error if any one of the above parameters, except for location description, were wrong. All errors carried equal weight. The idea was that any of those parameters being wrong can have an effect on DEC.

All field reports were funneled through the field audit contractor to TAB. TAB reviews all forms and creates summary reports for the audited plants for review.

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