Audit Committee

Ronaldo H.
Schmitz
(Chair)

William J.
Avery
Rick J.
Mills
   
Gilbert S.
Omenn
   

The Audit Committee assists the Board of Directors with oversight of the integrity of the company’s financial statements, the company’s compliance with legal and regulatory requirements, the independent auditor’s qualifications and independence, and the performance of the company’s internal audit function and independent auditor. In performing these oversight functions, the committee, among other things, reviews the company’s annual financial statements; selects the company’s independent auditing firm, PricewaterhouseCoopers LLP; approves all audit and nonaudit services and fees of the independent auditor; reviews the firm’s independence and considers the scope of its audits and audit results, including review of the auditor’s manage-ment letter and the company’s response to that letter; considers the adequacy of the company’s internal accounting control systems; reviews the staffing and audit program of the internal auditing department; and reviews the adequacy of
the company’s policies and procedures with respect to compliance with the Rohm and Haas Company Code of Business Conduct. The Board of Directors, in its business judgment, has affirmatively determined that all members of
the Audit Committee are independent and financially literate.

 

CHARTER OF THE AUDIT COMMITTEE OF THE BOARD
OF DIRECTORS OF ROHM AND HAAS COMPANY
(As Amended, Approved and Adopted March 2003)

Purpose
Organization and Membership Qualifications
Member Compensation
Meetings and Procedures
Duties and Responsibilities

 

Purpose

The purposes of the Audit Committee of the Board of Directors (the “Board”) of Rohm and Haas Company (the “Company”) shall be to: (A) assist the Board’s oversight of (1) the integrity of the Company’s disclosures, including its financial statements and disclosure and financial accounting controls and procedures, (2) the Company’s compliance with legal and regulatory requirements, and (3) the performance of the Company’s internal audit function and independent auditor; (B) engage the independent auditor and review and oversee its qualifications, performance and independence; (C) prepare the report required by the rules of the Securities and Exchange Commission to be included in the Company’s proxy statement; (D) review the Company’s financial plans and strategies, particularly its policies regarding capital structure, dividend payments and return on assets; (E) recommend to the Board all dividend declarations and payments; (F) review the Company’s foreign financial programs and currency exposure policies and practices, including derivative and hedging transactions; (G) oversee the function of the Company’s Benefits Investment Committee; and (H) fulfill the other responsibilities set out herein.

In discharging its responsibilities, the Audit Committee is not itself responsible for the planning or conduct of audits or for any determination that the Company’s financial statements are complete or accurate or in accordance with generally accepted accounting principles. This responsibility is that of management and the independent auditor.

 

Organization and Membership Qualifications

1. The Audit Committee shall be appointed by the Board and be composed of at least three (3) directors, each of whom shall meet, as affirmatively determined by the Board at least annually, the independence requirements of governing law, rules, regulations and the listing standards of the New York Stock Exchange.

2. The members of the Audit Committee shall be nominated and recommended to the Board by the Nominating Committee. The Board shall designate a member of the Audit Committee to serve as Chairperson. No member of the Audit Committee shall be removed except by majority vote of the independent directors of the full Board.

3. All members of the Audit Committee shall be financially literate. The Board shall appoint at least one member with accounting or related financial management expertise, and, to the extent possible, appoint at least one member who it has determined is an “audit committee financial expert” as the term is defined by SEC rules, and shall disclose the identity of any committee member possessing those attributes in the Company’s annual proxy statement.

4. If an Audit Committee member simultaneously serves on the audit committee of more than three public companies, the Board must determine that, as a condition of such member serving on the Company’s Audit Committee, such simultaneous service does not impair the ability of the member to serve effectively on the Company’s Audit Committee, and shall disclose this determination in the Company’s annual proxy statement.

 

Member Compensation

Director’s fees are the only compensation an Audit Committee member may receive from the Company for his/her service. Members of the Audit Committee may receive additional director’s fees if, in the judgment of the full Board, the time and effort they expend to fulfill their duties so warrants.

 

Meetings and Procedures

 

Duties and Responsibilities

To fulfill its duties and responsibilities, the Audit Committee shall: