The purposes of the Audit Committee are to (a) assist the Board of Directors
in fulfilling the Board's oversight responsibilities with respect to (i) the integrity of the Company's financial statements,
(ii) the Company's compliance with legal and regulatory requirements, (iii) the
independent auditors' qualifications and independence, and (iv) the performance
of the independent auditors and the Company's internal audit function; and (b)
oversee the preparation of the Committee's report, made pursuant to the
Securities Exchange Act of 1934 (the "Exchange Act"), to be included
in the Company's annual proxy statement (the "Audit Committee
The Committee shall be solely comprised of a minimum of three (3) and a maximum of five (5) independent members of the Board whose qualifications shall be as follows:
Each Committee member shall meet the independence criteria of (a)
the rules of the New York Stock Exchange, Inc., as such requirements are
interpreted by the Board in its business judgment and (b) Section 301 of the
Sarbanes-Oxley Act of 2002 (the "Act") and any rules promulgated
thereunder by the Securities and Exchange Commission ("SEC").
Each Committee member shall be financially literate or shall
become financially literate within a reasonable period of time after his or her
appointment to the Committee. Additionally, at least one member of the
Committee shall have accounting or related financial management expertise and
shall meet the criteria of a financial expert within the meaning of Section 407
of the Act and any rules promulgated thereunder by the SEC. The Board shall
determine, in its business judgment and upon the recommendation of the
Nominating and Governance Committee, whether a member is financially literate
and whether at least one member has the requisite accounting or financial
expertise and meets the financial expert criteria.
Each Committee member shall only receive, as compensation from the
Company, director’s fees (which includes all forms of
compensation paid to directors of the Company for service as a director or
member of a Board Committee).
4. Each Committee member shall serve on no more than two audit committees of public companies unless the Board of Directors has made an affirmative determination that such service would not detract from that Committee member’s ability to give adequate time to the Committee.
The Board shall appoint the members and the Chairman of the Committee based on nominations made by the Company's Nominating and Governance Committee. Committee members shall serve at the pleasure of the Board and for such term or terms as the Board may determine.
RESPONSIBILITIES AND AUTHORITY:
Retain Independent Auditors: Have the sole
authority to (a) retain and terminate the Company's independent auditors (b)
approve all audit engagement fees, terms and services, and (c) approve all
non-audit engagements with the Company's independent auditors. Such authority
shall be exercised in a manner consistent with the provisions of the Act. The
Chairman of the Committee shall have authority to grant any pre-approvals
required by the Act, subject to the Chairman reporting any such pre-approvals
to the Committee at its next scheduled meeting.
Review Auditors' Quality Control: At least annually,
obtain and review reports concerning all communications required by the Act and
the rules of the New York Stock Exchange.
Review Independence of Auditors: In connection with the
retention of the Company's independent auditors, at least annually review the
information provided by management and the auditors relating to the
independence of the audit firm, including, among other things, information
related to the non-audit services provided and expected to be provided by the
auditors. The Committee is responsible for (a) ensuring that the
independent auditors submit at least annually to the Committee a formal written
statement delineating all relationships between the auditors and the Company
consistent with Independence Standards Board Standard No. 1, (b) actively
engaging in a dialogue with the auditors with respect to any disclosed relationship
or services that may impact the objectivity and independence of the auditors
and (c) taking appropriate action in response to the auditors' report to
satisfy itself of the auditors' independence. In connection with the
Committee's evaluation of the auditors' independence, the Committee shall also
review and evaluate the lead partner of the independent auditors and take such
steps as may be required by law with respect to the regular rotation of the
lead audit partner and the reviewing audit partner of the independent auditors.
Set Hiring Policies: Set hiring policies for employees or former
employees of the independent auditors which shall include the restrictions set
forth in the Act.
Review Audit Plan: Review with the independent auditors its plans
for, and the scope of its annual audit, and other examinations.
Conduct of Audit: Discuss with the independent auditors the
matters required to be discussed by Statement on Auditing Standards No. 61 (as amended)
relating to the conduct of the audit, as well as any audit problems or
difficulties and management's response, including (a) any restriction on audit
scope or on access to requested information, (b) any disagreements with
management and (c) significant issues discussed with the independent
auditors' national office. Unresolved disagreements between management and the
independent auditors regarding financial reporting shall be decided by the
Discuss Financial Statements: Discuss with appropriate
officers of the Company and the independent auditors the annual audited and
quarterly financial statements of the Company, including (a) the Company's
disclosures under "Management's Discussion and Analysis of Financial
Condition and Results of Operations," and (b) the disclosures regarding
internal controls and other matters required to be reported to the Committee by
the Act and any rules promulgated thereunder by the SEC.
Discuss Earnings Press Releases: Discuss earnings press
releases, as well as financial information and earnings guidance provided to
analysts and rating agencies (including any use of "pro forma" or
"adjusted" non-GAAP information).
Review Internal Audit Plans: Review internal audit
plans for and the scope of ongoing audit activities.
Review Internal Audit Reports: Review the annual
report of the audit activities, examinations and results thereof of the
internal auditing department.
Review Systems of Internal Accounting Controls: Review the adequacy of
the Company's internal accounting controls, the Company's auditing organization
and personnel, and the Company's policies and compliance procedures with
respect to business practices which shall include the disclosures regarding
internal controls and matters required to be reported to the Committee by the
Act and any rules promulgated hereunder by the SEC.
Review Recommendations of Independent Auditors: Review with the senior
internal auditing executive and the appropriate members of management
recommendations made by the independent auditors and the senior internal
auditing executive, as well as such other matters, if any, as such persons or
other officers of the Company may desire to bring to the attention of the
Review Audit Results: Review with the independent auditors (A) the
report of their annual audit, or proposed report of their annual audit, (B) the
accompanying management letter, if any, (C) the reports of their reviews of the
Company's interim financial statements conducted in accordance with Statement
on Auditing Standards No. 71, and (D) the reports of the results of such
other examinations outside of the course of the independent auditors' normal
audit procedures that the independent auditors may from time to time undertake.
The foregoing shall include the reports required by the Act and, as
appropriate, (a) a review of major issues regarding (i)
accounting principles and financial statement presentations, including any
significant changes in the Company's selection or application of accounting
principles and (ii) the adequacy of the Company's internal controls and any
special audit steps adopted in light of material control deficiencies,
(b) a review of analyses prepared by management and/or the independent
auditors setting forth significant financial reporting issues and judgments
made in connection with the preparation of the financial statements, including
analyses of the effects of alternative GAAP methods on the financial statements
and (c) a review of the effect of regulatory and accounting initiatives,
as well as off-balance sheet structures, on the financial statements of the
Exchange Act: Obtain from the independent auditors assurance
that they will inform Company management concerning any information indicating
that an illegal act has or may have occurred that could have a material effect
on the Company’s financial statements and insure that such information has been
communicated by management to the Audit Committee.
Review Risk Management Policies: Review policies and
procedures with respect to risk assessment and risk management to oversee the
internal controls utilized by management in handling the Company's exposure to
risk. The Committee should discuss the Company's major financial risk exposures
and the steps management has taken to monitor and control these exposures.
Obtain Reports Regarding Conformity With Legal Requirements
and the Company's Code of Ethics: Review with management, the general counsel,
the Company's senior internal auditing executive and the independent auditor
that the Company and its subsidiary/foreign affiliated entities are in
conformity with applicable legal requirements and the Company's Code of Ethics.
Advise the Board with respect to the Company's policies and procedures regarding
compliance with applicable laws and regulations and with the Company's Code of
Ethics. Establish procedures for the receipt, retention, and treatment of
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
Discuss With General Counsel Matters Regarding Financial
Statements or Compliance Policies: Discuss with the Company's General Counsel
legal matters that may have a material impact on the financial statements or
the Company's compliance policies.
Review Other Matters: Review such other matters in relation to the
accounting, auditing and financial reporting practices and procedures of the
Company as the Committee may, in its own discretion, deem desirable in
connection with the review functions described above.
Board Reports: Report its activities regularly to the Board
in such manner and at such times as the Committee and the Board deem
appropriate, but in no event less than once a year. Such report shall include
the Committee's conclusions with respect to its evaluation of the independent
MEETINGS OF THE COMMITTEE:
The Committee shall meet in person or telephonically at least quarterly, or more frequently as it may determine necessary, to comply with its responsibilities as set forth herein. The Chairman of the Committee shall, in consultation with the other members of the Committee, the Company's independent auditors and the appropriate officers of the Company, be responsible for calling meetings of the Committee, establishing agenda therefor and supervising the conduct thereof. The Committee may also take any action permitted hereunder by unanimous written consent.
The Committee may request any officer or employee of the Company or the
Company’s outside legal counsel or independent auditors to attend a meeting of
the Committee or to meet with any members of, or consultants to, the Committee.
It is expected that the Committee shall routinely work with and through
management to fulfil its roles and responsibilities
except as required or prohibited by law. However, the Committee shall meet
periodically in separate private sessions with management, the independent
auditors, and the internal auditors to discuss such matters as either party
deems appropriate. Additionally the Committee may elect to meet in separate
private session with any other party they deem appropriate for private
RESOURCES AND AUTHORITY OF THE COMMITTEE:
The Committee shall have the resources and authority appropriate to
discharge its responsibilities and carry out its duties as required by law,
including the authority to engage outside auditors for special audits, reviews
and other procedures and to engage independent counsel and other advisors,
experts or consultants. The Audit Committee may also, to the extent it deems
necessary or appropriate, meet with the Company's investment bankers or financial
analysts who follow the Company.
AUDIT COMMITTEE REPORT:
The Committee shall prepare, with the assistance of management, the
independent auditors and outside resources (as deemed necessary), the Audit
ANNUAL REVIEW OF CHARTER:
The Committee shall conduct and review with the Board annually an evaluation
of this Charter and recommend any changes to the Board. The Charter evaluation
shall be conducted by the Committee in such manner as the Committee, in its
business judgment, deems appropriate.
ANNUAL PERFORMANCE EVALUATION:
The Committee shall conduct and review with the Board annually an evaluation of the Committee's performance with respect to the requirements of this Charter. This evaluation shall also set forth the goals and objectives of the Committee for the upcoming year. The performance evaluation shall be conducted by the Committee in such manner as the Committee, in its business judgment, deems appropriate.