2004 Committee Charter : CSK
The Audit Committee of the Board of Directors assists the Board in its oversight of (1) the integrity of the Company's financial statements, (2) the Company's compliance with legal and regulatory requirements, (3) the independent auditor's qualifications and independence, and (4) the performance of the Company's internal audit function and independent auditors.
Composition and Meetings
Audit Committee members shall be elected, and may be removed, by the Board of Directors. The membership of the Audit Committee shall consist of a Chairman and not less than two (2) additional Directors. Each member shall have no material relationship with the Company and shall satisfy the independence requirements of the New York Stock Exchange, and the rules and regulations of the Securities and Exchange Commission (the "Commission"). Each member shall satisfy the financial literacy requirements of the New York Stock Exchange and, if possible, at least one member shall qualify as an "audit committee financial expert" as defined by the applicable rules and regulations of the Commission.
The Audit Committee shall meet at least four (4) times annually, shall maintain minutes or other records of meetings and activities and shall report its actions and activities regularly and promptly to the Board of Directors.
No member of the Audit Committee shall receive from the Company compensation prohibited by, or which violates the independence requirements of, applicable laws and rules and regulations of governmental bodies and self-regulatory organizations, including the Commission and the New York Stock Exchange.
Duties and Responsibilities
The Audit Committee shall:
1. Have direct responsibility for the appointment, compensation, oversight and retention of the independent auditor.
2. Review and approve, in advance, any audit and permissible non-audit services and fees to be provided by the Company's independent auditor. The Audit Committee has ultimate authority for these approvals although such approval may be delegated to any committee member so long as the approval is presented to the full Audit Committee at its next meeting.
3. Review the scope and approach of work to be undertaken by the independent auditors. Annually obtain and review a report by the independent auditors describing the firm's internal quality control procedures; any material issues raised by the most recent internal quality control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues; all relationships between the independent auditor and the Company to assess the auditor's independence.
4. Review with management and the independent auditors, prior to filing or distribution of the annual and quarterly financial statements, the quality, clarity, consistency and completeness of the statements and related disclosures. These reviews shall include discussion of any serious difficulties or disputes between management and the independent auditors during the course of the audit or any significant findings based upon the auditor's limited review procedures prior to the filing of interim statements.
5. Discuss with management and the independent auditor, the Company's disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations," incorporated in its quarterly and annual reports filed with the Commission.
6. Discuss the Company's earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies.
7. Review the selection, application and disclosure of the (a) Company's critical accounting policies, and significant changes in the Company's accounting policies; (b) alternative treatments of financial information within generally accepted accounting principles, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the independent auditor; and (c) other material written communications between the independent auditor and management, such as any management letter or schedule of unadjusted differences.
8. Review any proposed changes in the Company's accounting or financial reporting, including the impact of new pronouncements of the various standard setting bodies or agencies which could have an effect on the Company's financial statements or condition.
9. Review with management and the independent auditors any significant transactions that are not a normal part of the Company's operations, including but not limited to any significant off-balance sheet structures, and changes, if any, in the Company's accounting principles or their application.
10. Provide an open channel of communications between management, the independent auditors, internal audit and the Board of Directors. Conduct separate executive meetings with the independent auditors, the internal auditors and management on a regular basis and report regularly to the Board of Directors.
11. Set clear hiring policies for the Company's hiring of employees or former employees of the independent auditor who participated in any capacity in the audit of the Company.
12. Review and discuss internal and external assessments of the adequacy and effectiveness of the Company's internal accounting and financial controls including the Company's policies and procedures to assess, monitor and manage business risk and legal and ethical compliance programs.
13. Review, with the Company's general counsel, and outside counsel, if appropriate, any legal matters that could have a significant impact on the Company's financial statements.
14. Review the findings of any examinations by regulatory agencies which may raise material issues regarding the Company's financial statements or accounting policies. Establish and oversee procedures for (a) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters; and (b) the confidential, anonymous submission by employees of concerns of the Company regarding questionable accounting or auditing matters.
15. Review and concur in the appointment, replacement, reassignment or dismissal of the executive responsible for internal audit.
16. Review the annual budget and staffing of the internal audit function, the scope of work of the internal auditors, any significant related findings and recommendations of the internal auditors, together with management's responses, and the Internal Audit Department charter annually.
17. Review with the Company's counsel compliance with conflict of interest, antitrust and corporate conduct policies, including the Company's Code of Ethics.
18. Review the management of insurable risk for the Company including, but not limited to, insurance coverage, disaster recovery programs and business interruption plans.
19. Review annual reports of travel and entertainment spending for the five highest compensated officers and, through the Chairman of the Committee of Independent Directors, approve the CEO's travel and entertainment expense reports.
20. Have the authority to retain special legal, accounting or other consultants to advise the Audit Committee as necessary to carry out its duties and to conduct or authorize investigations into any matters within its scope of responsibilities. The Company shall provide appropriate funding, as determined by the Audit Committee, for payment of compensation to the independent auditor and to any advisors retained by the Audit Committee.
21. Review and reassess at least annually the adequacy of this charter and submit the charter to the Board of Directors for approval and perform a self-assessment of the Audit Committee's performance.
22. Other duties as directed by the Board of Directors.
Annual Proxy Disclosure
The Audit Committee shall prepare its report to be included in the Company's annual proxy statement, as required by the Commission regulations and such report shall disclose that: