2003 Audit Charter: COHR



The primary function of the Audit Committee is to assist the Board of
Directors of Coherent, Inc. (the "Company") in fulfilling its oversight
responsibilities by reviewing: financial reports and certain other financial
information provided by the Company to any government body or the public; the
Company's system of internal controls regarding finance, accounting, legal
compliance and ethics that management and the Board have approved; and the
Company's auditing, accounting and financial reporting processes generally.
Consistent with this function, the Audit Committee should encourage continuous
improvement of, and should foster adherence to, the Corporation's policies,
procedures and practices at all levels. Specifically, the purpose of the Audit
Committee of the Board of Directors shall be to:

o Appoint and oversee the independent auditors employed by the Company
(including resolution of disagreements between management and the
auditors regarding financial reporting) for the purpose of preparing or
issuing audited financial statements and related work; such independent
public accounting firm shall report directly to the Audit Committee;

o Oversee the accounting and financial reporting processes of the Company;

o Assist the Board in oversight and monitoring of (i) the quality and
integrity of the Company's financial statements, (ii) the Company's
compliance with legal and regulatory requirements, (iii) the independent
auditor's qualifications, independence and performance, (iv) the
internal auditor's performance and (v) the Company's internal accounting
and financial controls;

o Prepare the report that the rules of the Securities and Exchange
Commission (the "SEC") require be included in the Company's annual proxy

o Provide the Company's Board with the results of its monitoring and
recommendations derived therefrom; and

o Provide to the Board such additional information and materials as it may
deem necessary to make the Board aware of significant financial matters
that require the attention of the Board.

In addition, the Audit Committee will undertake those specific duties and
responsibilities listed below and such other duties as the Board of Directors
may from time to time prescribe.


The Audit Committee members will be appointed by, and will serve at the
discretion of, the Board of Directors. The Audit Committee will consist of at
least three members of the Board of Directors. The members of the Committee
shall be elected by the Board until their successors shall be duly elected and
qualified. Unless a Chair is elected by the full Board, the members of the
Committee may designate a Chair by majority vote of the full Committee
membership. The Chair shall be responsible for leadership of the committee,
including preparing the agenda, presiding over meetings, making committee
assignments and reporting to the Board of Directors. The Chairperson will also
maintain regular liaison with the CEO, CFO, lead independent audit partner and
director of internal audit.

Members of the Audit Committee must meet the following criteria (as well
as any criteria required by the SEC):

o Each member will be an independent director, as defined in (i) NASDAQ
Rule 4200 and (ii) the rules of the SEC;

o Each member will be able to read and understand fundamental financial
statements, in accordance with the NASDAQ National Market Audit
Committee requirements. Committee members may enhance their familiarity
with finance and accounting by participating in educational programs
conducted by the Corporation and or outside consultants; and

o At least one member will have accounting or related financial management
competency in order to be an "audit committee financial expert" as
defined by the SEC. The board of Directors shall have the discretion to
determine members' conformity to these qualifications.


The responsibilities of the Audit Committee shall include:

o Reviewing on a continuing basis the adequacy of the Company's system of
internal controls, including meeting periodically with the Company's
management and the independent auditors to review the adequacy of such
controls and to review before release the disclosure regarding such
system of internal controls required under SEC rules to be contained in
the Company's periodic filings and the attestations or reports by the
independent auditors relating to such disclosure;

o Appointing, compensating and overseeing the work of the independent
auditors (including resolving disagreements between management and the
independent auditors regarding financial reporting) for the purpose of
preparing or issuing an audit report or related work;

o Pre-approving audit and non-audit services provided to the Company by
the independent auditors (or subsequently approving non-audit services
in those circumstances where a subsequent approval is necessary and
permissible); in this regard, the Audit Committee shall have the sole
authority to approve the hiring and firing of the independent auditors,
all audit engagement fees and terms and all non-audit engagements, as
may be permissible, with the independent auditors; reviewing and
providing guidance with respect to the external audit and the Company's
relationship with its independent auditors by (i) reviewing the
independent auditors' proposed audit scope, approach and independence;
(ii) obtaining on a periodic basis a statement from the independent
auditors regarding relationships and services with the Company which may
impact independence and presenting this statement to the Board of
Directors, and to the extent there are relationships, monitoring and
investigating them; (iii) reviewing the independent auditors' peer
review conducted every three years; (iv) discussing with the Company's
independent auditors the financial statements and audit findings,
including any significant adjustments, management judgments and
accounting estimates, significant new accounting policies and
disagreements with management and any other matters described in SAS No.
61, as may be modified or supplemented; and (v) reviewing reports
submitted to the audit committee by the independent auditors in
accordance with the applicable SEC requirements;

o Reviewing and discussing with management and the independent auditors
the annual audited financial statements and quarterly unaudited
financial statements, including the Company's disclosures under
"Management's Discussion and Analysis of Financial Condition and Results
of Operations," prior to filing the Company's Annual Report on Form 10-K
and Quarterly Reports on Form 10-Q, respectively, with the SEC;

o Directing the Company's independent auditors to review before filing
with the SEC the Company's interim financial statements included in
Quarterly Reports on Form 10-Q, using professional standards and
procedures for conducting such reviews;

o Conducting a post-audit review of the financial statements and audit
findings, including any significant suggestions for improvements
provided to management by the independent auditors;

o Reviewing before release the unaudited quarterly operating results in
the Company's quarterly earnings release and reviewing financial
guidance to be provided to the public;

o Overseeing compliance with the requirements of the SEC for disclosure of
auditor's services and audit committee members, member qualifications
and activities.

o Reviewing the Company's internal audit function quarterly and reviewing
the annual internal audit plan;

o Reviewing, approving and monitoring the Company's code of ethics for its
senior financial officers to be adopted prior to September 30, 2003;

o Reviewing management's monitoring of compliance with the Company's
standards of business conduct and with the Foreign Corrupt Practices

o Reviewing, in conjunction with counsel, any legal matters that could
have a significant impact on the Company's financial statements;

o If necessary, instituting special investigations with full access to all
books, records, facilities and personnel of the Company;

o As appropriate, obtaining advice and assistance from outside legal,
accounting or other advisors; reviewing and approving in advance any
proposed related party transactions; the Company shall provide the Audit
Committee with sufficient funding for these services;

o Reviewing its own charter, structure, processes and membership

o Providing a report in the Company's proxy statement in accordance with
the rules and regulations of the SEC; and

o Establishing procedures for receiving, retaining and treating complaints
received by the Company regarding accounting, internal accounting
controls or auditing matters and procedures for the confidential,
anonymous submission by employees of concerns regarding questionable
accounting or auditing matters.


The Audit Committee will meet at least four times each year. The Audit
Committee may establish its own schedule, which it will provide to the Board of
Directors in advance.

The Audit Committee will meet separately with the Chief Executive Officer
and separately with the Chief Financial Officer of the Company at such times as
are appropriate to review the financial affairs of the Company. The Audit
Committee will meet separately with the independent auditors of the Company, at
such times as it deems appropriate, but not less than quarterly, to fulfill the
responsibilities of the Audit Committee under this charter.


The Audit Committee will maintain written minutes of its meetings, which
minutes will be filed with the minutes of the meetings of the Board of


In addition to preparing the report in the Company's proxy statement in
accordance with the rules and regulations of the SEC, the Audit Committee will
summarize its examinations and recommendations to the Board of Directors as may
be appropriate, consistent with the Committee's charter.


Members of the Audit Committee shall receive such fees, if any, for their
service as Audit Committee members as may be determined by the Board of
Directors in its sole discretion. Fees may be paid in such form of
consideration as is determined by the Board of Directors.

Members of the Audit Committee may not receive any compensation from the
Company except the fees that they receive for service as a member of the Board
of Directors or any committee thereof.

Delegation of Authority:

The Audit Committee may delegate to one or more designated members of the
Audit Committee the authority to pre-approve audit and permissible non-audit
services, provided such pre-approval decision is presented to the full Audit
Committee at its scheduled meetings.