TSR, INC.
POLICY REGARDING ACCOUNTING
COMPLAINTS

1. Purpose and Overview

It is the policy of TSR, Inc. (the “Company”) to observe high ethical and professional standards in all of its activities. In matters of accounting and auditing in particular, the Company seeks to ensure that all transactions and corporate assets are properly accounted for and that all periodic reports filed with the Securities and Exchange Commission and all audits are thorough and complete. It is also important that the Company maintains the confidence of employees, stockholders, customers, vendors and the public in the quality of the Company’s accounting, accounting controls and public reporting. In order to help accomplish these objectives, the Company has established the following procedures for the reporting and resolution of complains and concerns about accounting, auditing and related matters.

Under the Sarbanes Oxley Act of 2002, the Audit Committee of the Board of Directors is responsible for establishing procedures for (i) the receipt, retention, processing and disposition or complaints received by the Company regarding accounting, auditing policies, internal accounting controls or auditing matters; and (ii) the confidential, anonymous submission by employees of the Company of concerns regarding accounting, accounting policies, internal accounting controls or auditing matters.

The Audit Committee shall administer this Policy, including interpreting this Policy and making judgments about the application of the procedures set forth herein. The Audit Committee may amend this Policy and the procedures included herein in its discretion.

2. Scope of the Policy

The term “accounting complaint” means any written correspondence or memorandum that is provided to the Company through the procedures mandated in this Policy and that contains a complaint, concern or reference to a problem or potential problem with the Company’s accounting, accounting policies, internal accounting controls, auditing or financial matters. Accounting complains should specify with reasonable detail, providing examples if possible, the nature and scope of the matters to which it refers. Accounting complaints should not include libelous information or statements.

This Policy will be displayed at an appropriate location on the Company intranet and on the Company’s external website.


3. Requirements for Submitting Accounting Complaints

Any person may bring an accounting complaint to the attention of the Company and the Audit Committee by following the procedures set forth in this Policy. Specifically, accounting complaints must be made by written correspondence addressed to:

Information contained in accounting complaints may be summarized, abstracted and aggregated for purposes of analysis and investigation (including information of the source of the accounting complaint, if not anonymous).

4. Anonymous and Confidential Submission

Employees may make accounting complaints on an anonymous basis. All accounting complaints will be treated confidentially, unless the person making the accounting complaint otherwise agrees.

An employee communicating an accounting complaint need not identify himself or herself. If the accounting complaint is made anonymously, the Company will not make any special effort to identify the person making the accounting complaint.

All accounting complaints will be treated confidentially and disclosed by the Chair of the Audit Committee first to the Audit Committee and, if it is determined by the Audit Committee that further action is required, only to persons on a “need-to-know” basis to ensure proper investigation and resolution of the accounting complaint. If the person communicating the accounting complaint identifies himself or herself to the Company, the Company will not disclose his or her identity to third persons without the person’s permission or as otherwise required by law.

5. Responsibilities of the Chair of the Audit Committee

The Chair of the Audit Committee will be responsible for receiving, reviewing and reporting to the Audit Committee all accounting complaints submitted from any source.  At each meeting of the Audit Committee, the Chair of the Audit Committee will report on the nature of all accounting complaints, if any, received after the most recent Audit Committee meeting.

6. Responsibilities of the Audit Committee

The Audit Committee will take whatever steps it deems necessary to respond to and resolve any accounting complaint received by the Company.

Specifically, the Audit Committee will evaluate accounting complaints that are brought to its attention and determine what response is necessary. For example, it may request additional information; recommend corrective action; require further investigation; or determine that no action is required. For purposes of this Policy, “corrective action” includes, but is not limited to, a change, modification or augmentation in the Company’s accounting and/or audit practices and policies or appropriate disciplinary action.

If further investigation is deemed necessary by the Audit Committee, the Audit Committee may take any of the following steps: (i) instruct Company personnel or the Company’s outside counsel to investigate the accounting complaint further; (ii) engage independent counsel or other advisors to conduct an investigation of the accounting complaint; or (iii) designate one or more members of the Audit Committee, either alone or together with the Company’s officers, the Company’s outside counsel and/or independent counsel and other advisors, to investigate the accounting complaint.

7. Record Keeping

All records and reports concerning accounting complaints received by the Company will be preserved for a period of six years. The Chair of the Audit Committee or a person designated by the Chair of the Audit Committee will have custody of the records of accounting complaints. After the six-year retention period, the records of accounting complaints may be disposed of in accordance with then-current Company policy. At least once per calendar quarter and whenever else as deemed necessary, the Chair of the Audit Committee or a person designated by the Chair of the Audit Committee shall submit to the Audit Committee a report that summarizes each accounting complaint made within the last 12 months and indicates (i) the complainant (unless anonymous, in which case the report shall so indicate), (ii) a detailed description of the substance of the accounting complaint, (iii) the status of any actions taken or to be taken at the request of the Audit Committee, (iv) any conclusions reached by the Audit Committee or investigator and (v) findings and recommendations.

8. Statement of Non-Retaliation

It is a federal crime to retaliate against any person who provides truthful information to a law enforcement official concerning a possible violation of any federal law. Moreover, the Company will not tolerate any form of retaliation, harassment or intimidation by any officer, associate, employee, contractor, subcontractor or agent of the Company against an employee because the employee has (i) submitted an accounting complaint in accordance with this Policy; (ii) provided information, caused information to be provided or otherwise assisted in an investigation regarding any conduct that the employee reasonably believes constitutes a violation of laws, rules, regulations or Company policies; or (iii) commenced, caused to be commenced, testified, participated or otherwise assisted in a proceeding relating to a violation of any law, rules, regulation or Company policy. Prohibited forms of retaliation, harassment or intimidation include, but are not limited to, discharge, demotion, suspension, threats, harassment or any other manner of discrimination with respect to an employee’s terms or conditions of employment. Employees who engage in any such prohibited conduct in violation of this Policy will be subject to discipline, up to and including termination.