Audit Committee Charter of Skywest Inc
AUDIT & FINANCE COMMITTEE CHARTER
Purpose of the Committee
The purpose of the Audit and Finance Committee (the "Committee")
of the Board of Directors (the "Board") of SkyWest, Inc. (the "Company")
is to oversee the Company's accounting and financial reporting processes,
systems of internal accounting and financial controls, and the audits of
the Company's financial statements.
The Committee shall have the authority to retain such outside
counsel, accountants, experts and other advisors as it determines
appropriate to assist it in the performance of its functions. The
Committee shall have sole authority to determine the fees and retention
terms of such counsel, accountants, experts and advisors. The Committee
shall have full access to all books, records, facilities and personnel of
The Committee shall consist of three or more independent directors
of the Board. For purposes of this Charter, the term "independent
director" means a director who meets the NASDAQ Stock Market, Inc.
definition of an "independent director," as determined by the Board.
Members of the Committee shall be appointed by the Board based on
nominations recommended by the Nominating and Corporate Governance
Committee of the Board and shall serve at the pleasure of the Board and
for such terms as the Board may determine. As determined by the Board,
each member of the Committee shall be financially literate at the time of
appointment, and at least one member of the Committee shall have
accounting or related financial management expertise, as provided in the
listing standards of the NASDAQ Stock Market, Inc.
Committee Structure and Operations
The Board shall designate one member of the Committee as its
Chairperson. In the event of a tie vote on any issue, the chairperson's
vote shall decide the issue. The Committee shall meet in person or
telephonically at least four times a year at a time and place determined
by the Committee chairperson, with further meetings to occur, or actions
to be taken by written consent, when deemed necessary or desirable by the
Committee or its chairperson. The Committee shall meet separately in
executive session periodically with each of management, the principal
internal auditor of the Company and the outside auditors of the Company
(the "External Auditors"). The Committee shall report regularly to the
Board with respect to its activities.
Except as prohibited by applicable law or this Charter, the
Committee may form and delegate authority to subcommittees as the
Committee reasonably deems appropriate. The Committee may designate a
non-member to serve as secretary at committee meetings to keep meeting
Committee Authority, Duties and Responsibilities
The Committee shall, consistent with and subject to applicable law
and rules and regulations promulgated by the U.S. Securities and Exchange
Commission (the "SEC") and the National Association of Securities Dealers
(the "NASD") and other applicable regulatory authorities, have the
following responsibilities and authority:
The Committee shall pre-approve all audit services and permissible
non-audit services as set forth in Section 10A(i) of the
Securities Exchange Act of 1934, as amended (the "Act").
The Committee shall have sole authority to appoint, determine
funding for and oversee the External Auditors as set forth in
Section 10A(m)(2) of the Act.
The Committee shall establish procedures for complaints as set
forth in Section 10A(m)(4) of the Act, including the (i) receipt,
retention and treatment of complaints received by the Company
regarding accounting, internal accounting controls and auditing
matters, and (ii) confidential, anonymous submission by employees
of the Company of concerns regarding questionable accounting or
The Committee shall have the authority to engage and determine
funding for independent counsel and other advisors as set forth in
Section 10A(m)(5) of the Act.
The Committee shall prepare the report of the Committee required
by the rules of the SEC to be included in the Company's Annual
Report on Form 10-K (or the Annual Report to Shareholders if
distributed prior to the filing of a Form 10-K).
The Committee shall review and discuss with management and the
External Auditors the audited financial statements and disclosures
to be made in management's discussion and analysis, prior to the
filing of each Annual Report on Form 10-K (or the Annual Report to
Shareholders if distributed prior to the filing of Form 10-K).
The Committee shall review and consider with the External Auditors
the matters required to be discussed by Statement of Auditing
Standards ("SAS") No. 61, as that statement may be amended from
time to time, including, without limitation, the amendments
contained in SAS No. 90.
As a whole, or through the Chairperson, the Committee will review
and discuss with management and the External Auditors the
Company's quarterly financial statements, including disclosures
made in management's discussion and analysis, prior to the filing
of each Quarterly Report on Form 10-Q, including the results of
the External Auditors' reviews of the quarterly financial
The Committee shall review and discuss with management and the
External Auditors the quality and adequacy of the Company's
financial controls, including the Company's internal audit
The Committee shall discuss with management the Company's earnings
press releases, including the use of "pro forma" or "adjusted"
non-GAAP information, as well as financial information and
earnings guidance provided to analysts and rating agencies.
The Committee shall discuss with management and the External
Auditors the effect of regulatory and accounting initiatives, as
well as off-balance sheet structures on the Company's financial
The Committee shall:
Request from the External Auditors annually a
formal written statement delineating all
relationships between the External Auditors and
the Company consistent with Independence Standards
Board Standard Number 1;
Discuss with the External Auditors any disclosed
relationships and their impact on the independence
of the External Auditors; and
Recommend that the Board take appropriate action
in response to the report of the External Auditors
to satisfy itself of the independence of the
The Committee shall review the performance of the Company's Chief
Executive Officer, Chief Financial Officer and Controller as their
performance relates to financial controls and procedures.
The Committee shall review and approve the Company's investment
With respect to compliance oversight responsibilities, the
Obtain from the External Auditors acknowledgement
that the provisions of Section 10A of the Act
(regarding, among other things, audit procedures
designed to detect illegal acts and related-party
transactions and the Company's operations as a
going concern) have been observed.
Obtain reports from the Company's Director of
Human Resources, the External Auditors and
Company's internal auditor that the Company and
its subsidiaries are in conformity with applicable
legal requirements and the Company's Code of
Corporate Conduct. The Committee will also review
reports and disclosures of related party
transactions and 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 Corporate Conduct.
Discuss with management and the External Auditors
any material correspondence between the Company
and regulators or governmental agencies and any
employee complaints or published reports which
raise material issues regarding the Company's
financial statements or accounting policies.
Discuss with the Company's management or legal
counsel legal matters that may have a material
impact on the financial statements or the
Company's compliance policies.
The Committee will review and discuss with management the content
of the Company's proxy statement and related materials, including
any report or disclosure with respect to the actions and duties of
The Committee shall annually review its own performance and this
Charter and recommend to the Board any proposed changes to this
While the Committee has the responsibilities and powers set forth
in this Charter, it is not the duty of the Committee to plan or conduct
audits, to assess and manage the Company's exposure to risk or to
determine that the Company's financial statements and disclosures are
complete and accurate and are in accordance with generally accepted
accounting principles in the United States and applicable rules and
regulations. These are the responsibilities of management and the External
Auditors. Nor is it the duty of the Committee to conduct investigations,
to resolve disagreements, if any, between management and the External
Auditors or to assure compliance with applicable laws and regulations or
the Company's Code of Conduct.