Page 534 - Auditing Standards

As of December 15, 2017

the responsibility of XYZ Stores Corporation's management. Our responsibility is to express an opinion on this
schedule based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the schedule of gross sales is free of material misstatement. An audit includes examining, on a

test basis, evidence supporting the amounts and disclosures in the schedule of gross sales. An audit also
includes assessing the accounting principles used and significant estimates made by management, as well as
evaluating the overall schedule presentation. We believe that our audit provides a reasonable basis for our

opinion.

In our opinion, the schedule of gross sales referred to above presents fairly, in all material respects, the gross

sales of XYZ Stores Corporation at its Main Street store, [City], [State], for the year ended December 31,
20X2, as defined in the lease agreement referred to in the first paragraph.

This report is intended solely for the information and use of the boards of directors and managements of XYZ

Stores Corporation and ABC Company and is not intended to be and should not be used by anyone other
than these specified parties.

Report Relating to Royalties

Report of Independent Registered Public Accounting Firm

We have audited the accompanying schedule of royalties applicable to engine production of the Q Division of
XYZ Corporation for the year ended December 31, 20X2, under the terms of a license agreement dated May
14, 20XX, between ABC Company and XYZ Corporation. This schedule is the responsibility of XYZ
Corporation's management. Our responsibility is to express an opinion on this schedule based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform the audit to obtain reasonable assurance

about whether the schedule of royalties is free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the schedule of royalties. An audit also
includes assessing the accounting principles used and significant estimates made by management, as well as

evaluating the overall schedule presentation. We believe that our audit provides a reasonable basis for our
opinion.

We have been informed that, under XYZ Corporation's interpretation of the agreement referred to in the first
paragraph, royalties were based on the number of engines produced after giving effect to a reduction for
production retirements that were scrapped, but without a reduction for field returns that were scrapped, even
though the field returns were replaced with new engines without charge to customers.

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