2003 Committee Charter : CRACelera Genomics
Charter of Audit/Finance Committee
(as of 8/21/03)
Audit Committee Charter Quicklinks
Purpose of the Committee
Responsibilities and Duties
The Audit/Finance Committee (the "Committee") shall consist of three or more directors as designated by the Board of Directors. All members of the Committee shall satisfy the independence and expertise requirements as defined in the applicable listing standards of the New York Stock Exchange and applicable law.
Meetings of the Committee shall be called by the Chairman of the Board, the Secretary, a Co-Chairman of the Committee, or any two Committee members. Three of the members of the Committee shall constitute a quorum for the transaction of business at such meeting, and all matters shall be determined by a majority vote of the members present.
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II. Purpose of the Committee.
The primary purpose of the Committee shall be to provide assistance to the Board of Directors in fulfilling its responsibilities to stockholders, potential stockholders, the investment community, and regulators relating to corporate accounting and finance, reporting practices of the Corporation, the quality and integrity of the financial reports of the Corporation, the Corporation's pension and savings plans, financing and capital structure, and legal compliance and business ethics. The Committee's role is one of oversight. Management is responsible for preparing the Corporation's financial statements, and the independent auditors are responsible for auditing those financial statements. Management is responsible for the fair presentation of the information set forth in the financial statements in conformity with generally accepted accounting principles ("GAAP"). The independent auditors' responsibility is to provide its opinion, based on their audits, that the financial statements fairly present, in all material respects, the financial position, results of operations, and cash flows of the Corporation in conformity with GAAP. However, it is not the duty of the Committee to plan or conduct audits or to determine that the Corporation's financial statements are in conformity with GAAP, or to assure compliance with applicable laws and regulations, the Corporation's ethical standards, or environmental compliance programs. The Committee shall also have such other responsibilities as may be assigned to it from time to time by the Board or which may otherwise be imposed from time to time by law. The Committee shall report its activities to the full Board on a timely basis so that the Board is kept informed of its activities.
The Committee shall permit direct access to the Committee by the Director of the Internal Audit Department, the Director of Corporate Compliance, the Corporation's independent accountants, or any other person, with respect to control, accounting, finance, or compliance matters.
The Committee shall have the authority to conduct or authorize investigations into any matters within its scope of responsibilities and shall have the authority to retain legal, accounting, or other advisors as it deems necessary to conduct such investigations or to carry out its responsibilities hereunder.
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III. Responsibilities and Duties.
In carrying out its responsibilities, the Committee shall:
Be directly responsible for the appointment (subject to ratification by the stockholders), compensation, and oversight of the work of independent accountants (including resolution of disagreements between management and the independent accountants regarding financial reporting) for the purpose of preparing or issuing an audit report or related work, and the independent accountants shall report directly to the Committee.
Review and approve each year the scope and plan of audit and non-audit services to be performed by the independent accountants, including areas of special emphasis where appropriate.
Following completion of the annual audit, review with management, the independent accountants, and the Internal Audit Department (1) the results of the audit, including any significant difficulties or any restrictions on the scope of the work or access to required information encountered during the course of the audit, (2) any recommendations for change or improvement in administrative and internal control procedures, (3) management's handling of any proposed audit adjustments, (4) any significant disagreement among management and the independent accountants or the Internal Audit Department, and (5) management judgments and estimates reflected in the financial statements.
On a periodic basis, ensure that the independent public accountants submit a formal written statement delineating all relationships between such accountants and the Corporation to determine the independence of such accountants. The Committee shall review and discuss with the independent accountants any disclosed relationships or services and take action, as appropriate.
Review the Corporation's quarterly and annual financial statements, notes, and related information prepared by management, including any report or opinion rendered by the independent accountants, and recommend that the annual financial statements, notes, and related information be included in the Corporation's Annual Report on Form 10-K.
Review significant accounting and reporting issues, including recent professional and regulatory pronouncements, and consider their potential impact on the Corporation's financial statements.
Review significant changes to the Corporation's auditing and accounting principles and practices as suggested by the independent accountants, management, or the Internal Audit Department.
Review activities, organizational structure, qualifications, and department budget of the Internal Audit Department and review and approve each year the scope and plan of audit services to be performed by the Internal Audit Department.
Review policies and procedures with respect to officers' expense accounts, including their use of corporate assets, and consider the results of any review of these areas by the Internal Audit Department or the independent accountants.
Regularly monitor the functioning of the Corporation's programs for compliance with legal and ethical standards.
Periodically review significant pending litigation affecting the Corporation and the findings of any significant examinations or investigations by judicial, governmental, or regulatory agencies.
Review policies and practices with respect to intergroup transactions and intergroup conflicts or potential conflicts under the Corporation's tracking stock structure.
Review the Corporation's financial strategies, policies, and programs, its capital structure, and the management of its Balance Sheet.
Review and make suggestions concerning management recommendations to the Board of Directors regarding financings for the Corporation, including the sale or purchase of Corporate securities and the placement of long term debt.
Review the employment and security of the Corporation's liquid assets, including review of short and long term investment and currency risk strategies.
Review and make recommendations to the Board of Directors regarding financial impact and methods of financing acquisitions and divestitures by the Corporation.
Review the Corporation's dividend policies and payments.
Review the Corporation's pension and savings plan policies, procedures, and performance.
Review the Corporation's risk management policies.
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IV. Charter Review.
The Committee shall review and reassess the adequacy of this Charter on an annual basis.