2003 Audit Charter: CLC

Adopted March 24, 2003




The Board of Directors of CLARCOR Inc. (the "Company") has appointed an Audit Committee pursuant to authorization in Section 3.11 of Article III of the Company's Bylaws. The objectives, composition and responsibilities of the Audit Committee are as follows:


The primary objective of the Audit Committee (the "Committee") is to to oversee management's conduct of the Company's financial reporting practices, including financial reports and other financial information provided by the Company to shareholders, the Company's systems of internal accounting and financial control, and the annual independent audit of the Company's financial statements.

In discharging its oversight role, the Committee has full access to all books, records, facilities and personnel of the Company and the power to retain and pay outside counsel, auditors or other experts for this purpose and is empowered to investigate any matter brought to its attention. The fees and expenses of such counsel, auditors and other experts shall be payable by the Company upon approval by the Committee.

The Committee shall review of this Charter on an annual basis.


The Committee shall consist of not less than three members, all of whom shall meet the requirements, from time to time in effect, of the New York Stock Exchange and applicable law (including, without limitation, the Sarbanes-Oxley Act of 2002 and the regulations issued thereunder (the "Act"). No member of the Committee shall be, at the time he or she is serving as a member of the Committee, a member of more than two additional audit committees, or their equivalents, of other listed companies. The Board of Directors shall appoint the Chairperson and the members of the Audit Committee who shall serve until their successors shall have been duly elected and qualified or until their earlier resignation or removal.


The Committee's job is one of oversight and it recognizes that the Company's management is responsible for preparing the Company's financial statements and that the outside auditor is responsible for auditing those financial statements. Additionally, the Committee recognizes that financial management, including the internal audit staff as well as the outside auditor, has more time, knowledge and more detailed information on the Company than the Committee members do. Consequently, in carrying out its oversight responsibilities, the Committee is not providing any assurance as to the Company's financial statements or any professional certification as to the outside auditor's work.

In carrying out its responsibilities:

n The Committee shall annually appoint a public accounting firm (the "Outside Auditor") for the purpose of issuing an audit report (and related work) with regard to the annual financial statements of the Company and its subsidiaries. The Committee shall determine the compensation to be paid by the Company to the Outside Auditor and shall be responsible for the resolution of any disagreement between the Company or its management and the Outside Auditor.

n The Committee shall have the power to terminate the appointment of the Outside Auditor for any cause or for no cause.

n The Committee shall approve in advance any non-audit services proposed to be provided by the Outside Auditor to the Company.

n The Committee shall annually appoint a person (the "Internal Audit Director") responsible for the internal audit function of the Company. The Committee shall have the power to terminate the appointment of the Internal Audit Director for any cause or for no cause.

n The Committee shall review with management, the Internal Audit Director and the Outside Auditor the audited financial statements to be included in the Company's Annual Report on Form 10-K and review and consider with the Outside Auditor the matters required to be discussed by Statement of Auditing Standards ("SAS") No. 61.

n The committee shall review with management and the Outside Auditor, (a) the Company's interim financial results to be included in the Company's quarterly reports to be filed with the Securities and Exchange Commission and the matters to be discussed by SAS No. 61 and (b) the related earnings press release. This review shall occur prior to the filing of Form 10-Q for such quarter.

n The Committee shall review the Outside Auditor's Management Letter and the Company's response and discuss with management, the Internal Audit Director and the Outside Auditor the quality and adequacy of the Company's internal controls.

n The Committee shall:

n Receive from the Outside Auditor annually, a formal written statement delineating all relationships between the Outside Auditor and the Company consistent with Independence Standards Board Standard No. 1 and any other applicable rule;

n Discuss with the Outside Auditor any such disclosed relationships and their impact on the Outside Auditor's independence;

n Review with the Outside Auditor, the staffing, scope, planning and fees for each year's audit;

n Review with the Outside Auditor and the Company's Internal Audit Director, the staffing, scope and planning for each year's internal audit activities and findings from prior internal audits;

n Meet with the Internal Audit Director to discuss the ongoing internal audit activities;

n Oversee the Company's policies which are disclosed to the Committee with respect to risk management and assessment;

n Review proposals to hire a chief executive officer, chief financial officer, chief accounting officer, Internal Audit Director or any person holding an equivalent position;

n Annually oversee the preparation of an annual report to shareholders as required by the Securities and Exchange Commission;

n Keep a record of acts and proceedings of the Audit Committee and report thereon to the Board;

n Review quarterly, with the Company's legal counsel, legal compliance matters or any legal matter that could have a significant impact on the Company's financial statements which is brought to the Audit Committee's attention;

n Perform such other activities, consistent with this Charter, the Company's Certificate of Incorporation, Bylaws and governing law as the Audit Committee deems necessary or appropriate; and

n Establish procedures for (i) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters and (ii) the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters. Review periodically with management and Internal Audit Director these procedures and any significant complaints received.

The Board of Directors shall evaluate the performance of the Committee and the compliance by the Committee with this Charter, no less often than annually.