Background Troy Dahlberg is a partner in Los Angeles with KPMG LLP s Forensic Advisory Services practice. He is also a co-leader of the firm s Western Region Forensic Practice. Prior to joining KPMG, Troy was the national practice leader for Kroll s Forensic Accounting and Litigation Consulting practice. Troy has also previously served as the partner in charge of another Big Four s Forensic Accounting and Litigation Consulting practice for the Pacific Southwest region. TROY A. DAHLBERG KPMG LLP 355 South Grand Avenue Los Angeles, CA 90071 Tel 213-955-8711 Fax 213-403-5688 Cell 213-300-1551 email tdahlberg@kpmg.com Function and Specialization Mr. Dahlberg specializes in complex accounting investigations, economic damage quantification and merger and acquisition disputes. Professional Associations AICPA California Society of CPAs American Bar Association Los Angeles County Bar Association Languages English Education, Licenses & Certifications University of California, Berkley, B.A. Southwestern School of Law, J.D. CPA, Licensed in CA JD, Licensed in CA ABV, Accredited in Business Valuation (AICPA) CFF, Certified in Financial Forensics (AICPA) Professional and Industry Experience Troy has more than 25 years of experience providing accounting, auditing and consulting services to companies in many industries. Troy has had a career-long focus working with outside counsel, corporate officers, and audit committees on financial reporting and forensic accounting issues. He has lead many complex accounting investigations involving issues brought by the Securities and Exchange Commission (SEC), Department of Justice (DOJ) and other government agencies. He has also provided services in numerous engagements related to bankruptcy issues, economic damages calculations, mergers and acquisitions disputes, and insurance claims. He has been designed as an expert witness on multiple occasions, Troy has testified in state and federal courts, as well as in various complex arbitrations. Troy has served as a neutral accountant, arbitrator and court-appointed expert and claims appraiser. Forensic Accounting Investigations. Troy has been retained by Audit Committees, corporations and governmental entities to perform accounting investigations. During these investigations he has had extensive experience interacting with external auditors and individuals in government agencies such as, the Chairman of the SEC, the head of the SEC enforcement division, US Attorneys, the Chief Accountant of OFHEO and the head of the California Department of Insurance. Troy has performed complex investigations relating to accounting irregularities and reporting violations. In investigations, such as the one he performed for the City of San Diego, he has also developed detailed remediation plans consistent with the concepts set forth in the SEC s Seaboard report. Economic Damage Quantifications. Troy has calculated economic damages on a wide range of matters including the computation of lost profits and other damages to the retail portion of the World Trade Center (due to the 9/11 terrorist attacks), and lost profits, lost rents and other economic losses for over 30 retail businesses and landlords related to a large subway construction project by the MTA. Mergers and Acquisitions Disputes. Troy has served as a neutral accountant and consultant on numerous mergers and acquisitions disputes. He has worked with buyers and sellers on the determination and documentation of numerous accounting issues related to the terms in acquisition agreements. He currently is a member of the AICPA s Mergers and Acquisitions Disputes subcommittee. Appointed as Neutral. Troy has served as a neutral accountant, arbitrator and court-appointed expert and appraiser in a multitude of disputes related to accounting issues, reporting issues, purchase price, earn out, ownership and insurance claims. The following is a representative sample of matters in which Troy has been involved. 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 1 of 11
Forensic Accounting Investigations Government - Served as member of Audit Committee for the City of San Diego along with former Chairman of SEC, Arthur Levitt, and former Accountant of the SEC, Lynn Turner. Oversaw investigation related to numerous allegations of improper financial and accounting disclosures as well as allegations related to violations of federal, state and municipal laws. Government - Investigation of City Attorney and City Manager for mishandling of city funds for their own benefit and for the benefit of certain city vendors. Government Investigation of the financial and accounting aspects of a longterm container agreement between a large Chinese container carrier and the Port of United States port. Government Investigation of rates, fees and costs related to a long-term solid waste hauler s agreement for the city of Santa Clarita. Service Industry Performed accounting and GAAP reporting investigation for the Audit Committee related to whistleblower allegations to the SC regarding revenue recognition for a lighting service company. Results of investigation presented to independent auditors of the financial statements. Manufacturer Performed accounting and GAAP reporting investigation related to revenue recognition, overstatement of inventory and improper actions of CFOs for the Audit Committee of a motorbike parts manufacturer. Results of investigation presented to independent auditors of the financial statements. Retail Performed accounting and GAAP reporting analysis related to revenue recognition and overstatement of inventory issues for a sunglasses retailer that was subject to class action suit. Entertainment Performed investigative accounting for internal and outside counsel related to whistleblower allegations to the SEC, IRS and other governmental agencies related to improper accounting, GAAP reporting and tax reporting. Technology Performed accounting and GAAP reporting analysis related to revenue recognition and overstatement of inventory issues for a semi-conductor manufacturer that was subject to a class action suit. Technology Performed accounting and GAAP reporting analysis related to recognition of improper credits and inventory issues for a semi-conductor manufacturer that was subject to a class action suit and investigations by the SEC and Justice Department. Satellite Television - Performed detailed accounting investigation and audit of a major satellite television company s billing, collection and rebate systems and programs. Cable Television Performed accounting and costing analysis of a major cable television company s expenses related to late payment penalty fees. Advertising Performed tracing and accounting analysis of various inter-company and operating transactions. 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 2 of 11
Financial Services Investigation of the operations and records of large companies that provide credit card networks and numerous large banks that issue credit cards, as relates to the charging and disclosure of fees for international transactions. Services included an analysis to determine the appropriateness of fees charged. Financial Services Investigation of payment processing timeliness and appropriateness of fees and penalties charged for credit card services for several large banks. Analysis and documentation of banking records for credit card services. Development and implementation of procedures to handle customer questions and complaints. Financial Services Analysis, investigation and documentation of bank s records related to alleged money laundering activities and offering of illegal investment programs. Analysis of failure of bank to report taxable earnings on investments to the Internal Revenue Service. Financial Services Investigation of transactions of an investment partnership regarding real estate and other investments for a European bank. Financial Services Investigation and evaluation of loan portfolio for a commercial bank. Financial Services Court-appointed accounting expert to determine sales and compensation for a manager for a number of branches of an escrow company. Financial Services Investigation of transactions made by a general partner for an investment group. Investigation included the tracing of funds to offshore businesses and bank accounts as well as to the purchase of investments in the United States. Financial Services Investigation on behalf of a large insurance company of trust accounting, which included alleged misreporting of premiums and misappropriation of trust funds by a managing general agent. Financial Services Investigation of related party transactions between a large California insurance company, an offshore reinsurance company and other businesses for the California Department of Insurance. Financial Services Investigation of improper accounting of premiums and losses by an insurance broker and insurance company related to a reinsurance program for worker compensation insurance on behalf of the reinsurance company. Professional Services Perform accounting investigation and prepare dissolution accounting for a law firm under Jewel v. Boxer/unfinished business guidelines. Professional Services Perform investigation of accounting practices of law firm in order to determine if a fraud was committed. Restaurant Industry Investigation of meat distributor for a national restaurant chain for breach of contract allegation relating to cost plus pricing and aging provision of the distribution agreement. Consumer Products Investigation of operator related to certain transactions and compliance with franchise agreement for large copy-service company. Healthcare Investigation of alleged improper Medicare billings by university 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 3 of 11
teaching hospitals based on claims from the Office of Investigator General (OIG) and U.S. Attorney on behalf of the hospitals. Produce Industry Investigation of alleged embezzlement by officer and other employees of produce distribution company through inventory shrinkage and kickback agreements with customers. Manufacturing Investigation for multinational corporation producing large electrical products involving activities and transactions of subsidiary company based in Mexico. Restaurant Industry/Franchise Investigation of purchases and accounting records of a number of franchises on behalf of an international fast food franchiser. Professional Services Investigation of an attorney for improper transfer and conversion of law firm partnership funds. Energy Investigation into books and records of Indonesian oil project related to net profits owed to a minor shareholder on behalf of the minor shareholder. Entertainment Investigation into the number of sales of various entertainers CDs and tapes in order to determine royalties due a producer. Technology Investigation into the number of sales of software in order to determine royalties due a software company on behalf of the software company. Technology Investigation of alleged employee embezzlement of funds through the manipulation of payroll and vacation records on behalf of a large hardware producer. Technology Investigation of fraudulent billing practices by a professional services firm on behalf of a large biotechnology company. Professional Services Investigation of alleged improper billings and embezzlement of funds by doctors within a professional medical corporation. Technology Investigation of sales of bundled Microsoft products by a computer retailer on behalf of the computer retailer. Energy Investigation of rebate program sponsored by a natural gas company/utility related to the purchase and installation of insulation materials for homes on behalf of the natural gas company. Construction Investigation of cost overruns by general contracts on construction projects for a city. Consumer Products Court-appointed accounting expert to determine the correct amount of copy machine sales in a dispute between the owners of the business. Real Estate Investigation as to whether transactions were made in compliance with offering documents for a real estate investment on behalf of an investor group. Real Estate Investigation of alleged fraudulent transactions of general partner for a number of commercial real estate partnerships on behalf of a Korean limited partner. Real Estate Investigation into allegation made by minority partner that there were improper accounting of rents, expenses and management fees related to 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 4 of 11
the operations of a number of commercial office buildings and apartment complexes. Real Estate Investigation of alleged employee embezzlement of funds through the manipulation of company credit cards on behalf of a realtor s association. Real Estate Investigation into allegations made by minority partner that there was improper accounting of rents, expenses and management fees related to the operation of a large commercial office building. Real Estate Computation of lost rents and other economic losses due to the alleged breach of a lease for a commercial office building. Hotels Computation of lost profits and other economic losses for large hotels related to large subway construction project. Construction Investigation of general contractor s payments on construction of a large retail commercial center on behalf of the developer. Construction Investigation of general contractor s payments and cost overruns on construction of a large commercial office building on behalf of the bank/lender. Construction Investigation of general contractor s payments and cost overruns on construction of a large luxury hotel on behalf of the bank/lender. Construction Monitoring and investigation of general contractor s and owner s payments relating to cost overruns on construction and FF&E for a major renovation of a large luxury hotel on behalf of the lender. Hospitality Investigation and monitoring of hotel renovation costs for a major hotel property in Beverly Hills. Entertainment Investigation of Whistle Blower charges relating to the financial statement of operations for the US operations of a major commercial television network in the UK. Economic Damages Real Estate Computation of lost profits and other economic damages for the retail portion of the World Trade Center due the terrorist attacks on September 11, 2001. Real Estate Computation of lost profits and other economic damages pertaining to lost seminar, video and publication sales due to wrongful interference with how to succeed in real estate business. Real Estate Computation of lost profits, lost rents and other economic losses for over 30 retail businesses and landlords related to large subway construction project in Los Angeles. Hospitality Computation of lost profits and other economic damages for a large hotel property located in Los Angeles related the reduction room occupancy, banquets & meeting use and food services due to a construction project. Hospitality Computation of lost profits and other economic damages for a large hotel property located in San Antonio related to the reduction of room occupancy, banquets & meeting use and food service due to a flood. Energy Computation of lost net profits due to a limited partner from investment 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 5 of 11
in an Indonesian oil field. Energy Computation of lost royalties due to a breach of contract for the production of geothermal energy. Health Care Computation of lost profits and other economic damages for a diagnostic imaging business due to a breach of contract and fiduciary duty. Garment Computation of lost royalties from the licensing of an apparel brand name due to alleged misrepresentations and economic fraud committed by a turn around specialist. Professional Services Computation of business interruption loss for a law firm due to water damage. Health Care Computation of lost profits for a professional corporation that provided ophthalmology services which allegedly breached its contact with a health care provider group. Dental Manufacturer Computation of lost profits and other economic damages to a large German dental manufacturer related to a breach of a patent/licensing agreement with a United States research university. Technology Provided expert testimony services for computation of economic damages related to a store manager s alleged termination, and lost option right to acquire a dealership for laser and machine control devices for construction. Technology Computation of lost profits and other economic damages pertaining to the alleged breach of a development agreement between a British hardware company and a United States children s educational software company. Restaurant Industry/Franchise Computation of lost profits and other economic damages for a casual dining restaurant in Los Angeles. Restaurant Industry/Franchise Computation of lost profits and other economic damages for a casual dining restaurant in Los Angeles. Restaurant Industry/Franchise Computation of lost profits and other economic damages for a location of a national sandwich franchise. Restaurant Industry/Franchise Computation of lost profits and other economic damages for a Hong Kong based franchisee related to a breach of franchise agreement by an international fast food franchiser. Professional Services Computation of lost profits and lost/impaired goodwill to a law firm by the departure attorneys from the firm and their alleged taking of the law firm s clients (Jewel v. Boxer). Entertainment Computation of lost profits and other economic damages pertaining lost seminar, video and publication sales due to wrongful interference with business and contracts. Entertainment Computation of lost profits and other economic damages for a production company due to breach of fiduciary duties of one of the principles of the company. Entertainment Computation of lost profits and other damages due to the unauthorized use of a celebrity s image. 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 6 of 11
Entertainment Computation of lost profits for large live entertainment theater related to subway construction. Garment/Cosmetic Industry Computation of damages under the Lanham Act related to alleged unauthorized use of trademark by a cosmetic manufacturer of a garment manufacturer s trademark. Garment Industry Computation of lost profits for clothing manufacturer related to trademark infringement. Construction Computation of lost profits for contractor due to breach of construction agreement. Consumer Products Computation of lost profits and other economic damages for appliance retailer due to breach of supply agreement. Health Care Computation of lost profits and other economic damages for a diagnostic imaging business due to a breach of contract and fiduciary duty. Garment Industry Computation of lost profits and other economic damages due to alleged copyright infringement by large United States and Hong Kong jean manufacturers. Produce Industry Computation of lost profits and other economic damages for fruit and vegetable distributor due to breach of a purchase agreement, taking of employees and trade secrets. Chemical Manufacturer Computation of lost profits and other economic damages related to the failed implementation of an electronic software system for orders, inventory, purchasing and delivery for a chemical distributor. Technology Computation of lost royalties due to software manufacturer from retailer. Technology Computation of economic damages related to patent infringement of coin change machine. A United States company sued a Japanese company that allegedly infringed on the design for coin changers in candy and soda machines. Entertainment Computation of lost royalties due to a producer for CD and tapes sales for his recording artists. Consumer Products Analysis of net worth and financial condition of a large food manufacturer relating to its ability to pay a punitive damage award. Mergers and Acquisitions Disputes Earn Out Dispute Served as an arbitrator in an earn-out dispute, relating to the proper calculation of an earnings adjustment related to inventory, for the former owner and current officer of an electronic game manufacturer. Earn Out Dispute Served as an arbitrator in an earn-out dispute relating to the proper calculation of EBITDA for the former owner and current officer of a tire and automotive parts business. Purchase Price Dispute Expert witness in a purchase price dispute involving receivables, inventory and deferred revenue for a health care software company. Purchase Price Dispute Expert witness in a purchase price dispute involving receivables, fixed assets and deferred revenue for a transportation company. 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 7 of 11
dispute related to the proper closing accounting for inventory for a computer game manufacturer. dispute related to the proper closing accounting for receivables, inventory and payables for a blind manufacturer, distributor and retailer. dispute related to the proper closing accounting for deferred tax assets for a company that owned and operated television channels. dispute related to the proper closing accounting for receivables, inventory and payables for a home and business security company. dispute relating to the proper closing accounting for receivables, inventory, fixed assets, accruals and payables for a company that manufactures food processing machines. dispute relating to the proper closing accounting for receivables, inventory and accruals for an aerospace company that manufactured metal extrusions for primarily commercial aircraft. Purchase Price Dispute Served as consultant to arbitrator in a purchase price dispute relating to the proper accounting for items to be included in inventory for a company that provided food servicing. Purchase Price Dispute Served as team leader in engagement as neutral accountants in a purchase price dispute involving $250,000 worth of accounting adjustments for a company that manufactured automotive parts. Ownership Dispute Provided expert testimony services for computation of economic damages related to a store manager s alleged termination, and lost option right to acquire a dealership for laser and machine control devices for construction. Ownership Dispute Computation of lost profits and other economic damages pertaining to the alleged breach of a development agreement between a British hardware company and a United States children s educational software company. Purchase Price/Value Dispute Provided audit, valuation and financial consulting services related to acquisition disputes and business reorganizations involving a large publicly traded home health care provider. Ownership Dispute Provided consulting services in a litigation related to an ownership dispute of hotel Del Coronado and numerous related party owned businesses as to the accounting, tax and transfer issues. Buy/Sell Dispute Expert witness in a purchase price and earn out dispute involving alleged overstatement of cash, receivables and other assets and understatement of payables and accruals for a video production business. Earn out dispute involved sales and EBITDA calculations. Purchase Price Dispute Consultant in a purchase price dispute involving 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 8 of 11
overstatement of inventory and understatement of loss contract reserve for acquisition of a HMO. Purchase Price Dispute Expert witness in a purchase price dispute involving alleged overstatement of inventories and receivables and understatement of liabilities due to warranty claims, law suits and workers compensation for an aerospace company that manufactured kitchen unit/components for commercial aircraft. Purchase Price Dispute Expert witness in a purchase price dispute involving alleged understatement of receivable, inventory, other accruals and loss contracts for an aerospace company that manufactured overhead bins and bathroom fixtures for commercial aircraft. Purchase Price Dispute Consultant in a purchase price dispute involving alleged overstatement of fixed assets, such as building and equipment, as well as overstatement of capitalized expenditures for a micro-chip manufacturer. Purchase Price Dispute Consultant in a purchase price dispute involving understatement of receivables, accounts payable, accrued expenses, and allowance for doubtful accounts, as well as an overstatement of unearned revenue for a software manufacturer. Buy/Sell Dispute Provided consulting services to determine the value of a hospital s minor shareholder position in a medical services group. Purchase Price Dispute Expert witness in a purchase price and earn out dispute related to allegations that capital investments into sold business required of the buyer were not made and that sales and profits of sold company were adversely affected by sellers actions. Determination of business value before and at time of transaction. Issues involved the sales and post operations of a business, which sold or licensed the use of photographs on CDs or over the Internet. Appointed As Neutral Professional Services Court appointed expert to perform an accounting or the dissolution of a law partnership. Ownership Dispute Court appointed expert to determine proper dissolution accounting for a company that sold copy machines. Purchase Price Dispute Served as an arbitrator in a purchase price dispute involving working capital, including issues related to overstatement of receivables and other assets and understatement of payables for a residential and business security company. dispute related to the proper closing accounting for inventory for a computer game manufacturer. dispute related to the proper closing accounting for receivables, inventory and payables for a blind manufacturer, distributor and retailer. dispute related to the proper closing accounting for deferred tax assets for a company that owned and operated television channels. 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 9 of 11
dispute relating to the proper closing accounting for receivables, inventory, fixed assets, accruals and payables for a company that manufactures food processing machines. dispute relating to the proper closing accounting for receivables, inventory and accruals for a company that manufacturers metal products. Purchase Price Dispute Served as consultant to arbitrator in a purchase price dispute relating to the proper accounting for items to be included in inventory for a company that provided food servicing. Purchase Price Dispute Served as team leader in engagement as neutral accountants in a purchase price dispute involving $250,000 worth of accounting adjustments for a company that manufactured automotive parts. Earn Out Dispute Served as an arbitrator in an earn-out dispute, involving the proper calculations of an earnings adjustment related to inventory and GAAP issues, for the former owner and current officer of an electronic game manufacturer. Earn Out Dispute Served as an arbitrator in an earn-out dispute relating to the proper calculation of EBITDA for the former owner and current officer of a tire and automotive parts business. Real Estate Court appointed expert to perform investigative accounting of professional fees and commissions relating a residential home developer. Insurance Claim Appointed as an appraiser related to disputed calculations of business interruption and extra expense losses at a modeling agency due to fire. Insurance Claim Appointed as an umpire related to disputed calculations of business interruption and extra expense losses at an apparel store due to a fire. Insurance Claim Appointed as an appraiser related to disputed calculations of business interruption and extra expense losses at a computer wholesaler due to theft. Insurance Claim Appointed as an appraiser related to disputed calculations of business interruption and extra expense losses at a dental business due to an earthquake. Insurance Claim Appointed as an appraiser related to disputed calculations of business interruption and extra expense losses at a furniture manufacturer due to fire. Insurance Claim Appointed as an appraiser related to disputed calculations of business interruption and extra expense losses at a manufacturing and retail sales facility for stone and other facades used in residential home construction Selected Presentations Forensic & Investigative Accounting Skills, Laventhal & Horwath CPAs Internal Training How to Serve as an Appointed Neutral Accountant, California Society CPAs Economic Damages Section Computation of Insurance Claims, California Society CPAs Economic Damages 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 10 of 11
Section The Use of Prejudgment Interest and Discount Rate on the Use of Economic Damage Computation, California Society CPAs Advanced Litigation Consulting Conference Jury Instructions and Their Impact on Economic Damage Calculations, California Society CPAs Advanced Litigation Consulting Conference Direct and Cross Examination of Financial Experts, Association of Business Trial Lawyers Computation of Damages in Disputes relating to Intellectual Property Disputes, California Society CPAs Economic Damages Section Computation of Damages for Wage & Hour Disputes, California Society CPAs Economic Damages Section Death of an Expert the Daubert Challenge, American Institute of Certified Public Accountants Conferences on Fraud and Litigation Services Daubert Case Law, American Institute of Certified Public Accountants Conferences on Fraud and Litigation Services Publications and Speaking Engagements Engagement Letters for Litigation Services Practice Aid 04-1, AICPA Business Valuation and Forensic Services Section Recent Developments for the Determination & Calculation of Punitive Damages, The Witness Chair, Fall 2003 Which Analysis is Better Lost Profits or Loss in Business Value? The Witness Chair, Fall 2003 Price Elasticity, The Witness Chair, Winter 2002 Sarbanes-Oxley Act, The Witness Chair, Fall 2002 Who s Who? Faces Behind the Numbers in L.A. Accounting World, Los Angeles Business Journal, October 1998 Federal Estate Tax and the Right of Publicity: Taxing Estates for Celebrity Value, Harvard Law Review, January 1995 2013 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent Page 11 of 11