Audit Committee Charter
The Audit Committee (the
"Committee") is created by the Board of Directors of the Company to:
the Board in its oversight responsibilities by overseeing the accounting
and financial reporting processes of the Company and the audits of the
financial statements and internal control over financial reporting of the
Company by reviewing
qualifications, independence and performance of the Company's independent
performance of the Company's internal audit function;
quality and integrity of the financial statements and the effectiveness
of internal control over financial reporting of the Company; and
the audit committee report that Securities and Exchange Commission (the
"SEC") rules require to be included in the Company's annual
It is not the duty of the Committee
to determine that the Company's financial statements are complete and accurate
and are in accordance with GAAP, to determine that the Company's internal
control over financial reporting is effective, or to plan or conduct audits.
This is the responsibility of management and the independent auditors.
The Committee shall consist of at
least three members, comprised solely of independent directors meeting the
requirements of applicable SEC and Nasdaq
rules. The Governance and Directors Nominating Committee shall recommend
nominees for appointment to the Committee annually and as vacancies or newly
created positions occur. Committee members shall be appointed by the Board and
may be removed by the Board at any time. The Governance and Directors
Nominating Committee shall recommend to the Board, and the Board shall
designate, the Chairperson of the Committee.
Authority and Responsibilities
In addition to any other
responsibilities which may be assigned from time to time by the Board, to
fulfill its responsibilities and duties, the Committee shall:
directly responsible for the appointment (subject, if applicable, to
shareholder ratification), compensation, retention, and oversight of the
independent auditors engaged to conduct the audits of the Company's
financial statements and internal control over financial reporting
(including resolution of disagreements, if any, between management and the
independent auditors regarding financial reporting) or other audit, review
or attest services. The independent auditors shall report directly to the
all audit services and permissible non-audit services to be provided by
the independent auditors either before the independent auditors are
engaged to render such services or pursuant to pre-approval policies and
procedures established by Committee. The Committee may delegate its
authority to pre-approve services to one or more Committee members,
provided that such designees present any such approvals to the full
Committee at the next regularly scheduled Committee meeting.
and approve the independent auditors' annual audit plan and the terms of
the engagement letter.
the independent auditors' qualifications, performance and independence. As
part of such evaluation:
and review a report or reports from the Company's independent auditors:
the independent auditors' internal quality-control procedures;
any material issues raised by (i) the most
recent internal quality-control review or peer review of the auditing
firm, or (ii) any inquiry or investigation by governmental or
professional authorities, within the preceding five years, regarding one
or more independent audits carried out by the auditing firm; and any
steps taken to deal with any such issues; and
that Section 10A of the Securities Exchange Act of 1934 has not been
least annually, the Committee shall obtain a formal written statement
from the Company's independent auditors describing all relationships
between the independent auditors and the Company consistent with
Independence Standards Board Standard No. 1; actively engage in a
dialogue with the independent auditors with respect to any disclosed
relationships or services that may impact the objectivity and
independence of the independent auditor; and take, or recommend that the
full Board take, appropriate action to oversee the independence of the
the Company's hiring of current or former employees of the independent
- At least annually,
evaluate the performance, responsibilities, budget and staffing of the
Company's internal audit function and review the internal audit plan.
Financial Statements; Internal
Control over Financial Reporting; Disclosure and Other Compliance Matters
in conjunction with management, the Company's policies generally with
respect to the Company's earnings press releases and with respect to
financial information and earnings guidance provided to analysts and
rating agencies, including the use of non-GAAP financial information.
with management, the internal auditors and the independent auditors:
annual audited financial statements, including the Company's disclosures
under "Management's Discussion and Analysis of Financial Condition
and Results of Operations," prior to the filing of the Company's
Form 10-K. As part of such review, the Committee shall obtain a report
from the Company's independent auditors on those matters required
pursuant to SEC Regulation S-X Rule 2-07;
annual audited management assessment of the effectiveness of internal
control over financial reporting, including the Company's disclosures
under "Management's Report on Internal Control Over Financial
Reporting," prior to the filing of the Company's Form 10-K;
quarterly financial statements, including the Company's disclosures under
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," prior to the filing of the Company's Form 10
quarterly and annual earnings press releases prior to their publication.
in conjunction with the chief executive and chief financial officers of
the Company, the Company's internal control over financial reporting
(including compliance with applicable laws and regulations) and disclosure
controls and procedures. Items monitored with respect to each of these
matters include any significant deficiencies or material weaknesses in the
design or operation of such controls and procedures, any corrective
actions taken with regard to such deficiencies and weaknesses, and any
fraud involving management or other employees with a significant role in
such controls and procedures.
and discuss with the independent auditors those matters required to be
discussed with the Committee by the auditors pursuant to Statement on
Auditing Standards No. 61, as amended.
to the Board that the annual audited financial statements be included in
the Company's Form 10-K for filing with the SEC.
the audit committee report that Securities and Exchange Commission rules
require to be included in the Company's annual proxy statement.
all related party transactions, as defined by applicable Nasdaq rules, to which the
Company is a party.
the Company's policies and practices with respect to financial risk
assessment and management, including discussing with management the
Company's major financial risk exposures and the steps that have been
taken to monitor and control such exposures.
receipt, retention and treatment of complaints received by the Company
regarding accounting, internal accounting controls or auditing matters,
confidential, anonymous submission by employees of the Company of
concerns regarding questionable accounting or auditing matters.
Reporting to the Board
to the Board periodically. This report shall include a review of any
recommendations or issues that arise with respect to the qualifications,
independence and performance of the Company's independent auditors, the
performance of the internal audit function, the quality and integrity of
the Company's financial statements and the effectiveness of internal
control over financial reporting, and any other matters that the Committee
deems appropriate or is requested to be included by the Board.
least annually, evaluate its own performance and report to the Board on
review and assess the adequacy of this charter and recommend any proposed
changes to the Board for approval.
The Committee shall meet as often
as it determines is appropriate to carry out its responsibilities under this
charter, but not less frequently than quarterly. The Chairperson of the
Committee, in consultation with the other Committee members, shall determine
the frequency and length of the Committee meetings and shall set meeting
agendas consistent with this charter.
The Committee shall meet
separately, periodically, with management, with internal auditors or other
personnel responsible for the internal audit function, and with the independent
The Committee is authorized
(without seeking Board approval) to address any matter brought to its attention
with full access to funding and all books, records, facilities and personnel of
the Company and is authorized to retain independent counsel or other advisors
and may request any officer or employee of the Company or the Company's
independent auditors or outside counsel to meet with any members of, or
advisors to, the Committee.
The Committee may delegate its
authority to subcommittees or the Chairperson of the Committee when it deems
appropriate and in the best interests of the Company.