2004 Committee Charter : WFC
The primary purpose of the Committee is to assist the Board of Directors in fulfilling its responsibilities to oversee management activities related to accounting and financial reporting policies, internal controls, auditing practices, and legal and regulatory compliance; to discuss the integrity of the Company's financial statements and the adequacy and reliability of disclosures to stockholders; to review the qualifications and independence of the outside auditors and the performance of internal and outside auditors; to prepare the Committee report included in the Company's annual proxy statement in accordance with SEC rules; to perform the audit committee functions specified by 12 C.F.R. Part 363 for depository institution subsidiaries of the Company; and to perform the functions of a fiduciary audit committee required by 12 C.F.R. § 9.9 for national bank subsidiaries of the Company that have fiduciary powers.
While the Committee has the responsibilities and powers set forth in this Charter, the Committee is not providing any expert or special assurance as to the Company's financial statements, internal controls, or any professional certification as to the outside auditors' work, and it is not the duty of the Committee to plan or conduct audits or to determine that the Company's financial statements are complete and accurate and are in accordance with generally accepted accounting principles. This is the responsibility of management and the outside auditors. Nor is it the duty of the Committee to assure compliance with laws and regulations and the Company's Code of Ethics and Business Conduct.
The Committee is comprised of a minimum of three members, and meets regularly at least four times per year. Special meetings may be called in accordance with the By-Laws or resolutions adopted by the Board. Committee members are appointed by the Board on the recommendation of the Governance and Nominating Committee and may be replaced by the Board. Committee members shall meet all applicable independence and experience requirements imposed by statute, the New York Stock Exchange, and any applicable regulatory authority. Committee members shall not simultaneously serve on the audit committees of more than two other public companies.
AUTHORITY AND RESPONSIBILITIES:
The Committee provides a vehicle for communication between the directors and the outside auditors, the internal auditors and financial management, and establishes a forum for an open exchange of views and information. The Committee will meet periodically with management, the internal auditors, and the outside auditors in separate executive sessions. The outside auditors shall report directly to the Committee.
The Committee may, in its discretion, form and delegate all or a portion of its authority to subcommittees. The Committee shall make regular reports to the Board summarizing the matters reviewed and actions taken at each Committee meeting.
In carrying out its oversight function, the Committee is responsible for conducting the following recurring activities:
Integrity of Financial Reporting
1. Financial Reporting Generally. Discuss the annual audited financial statements and quarterly financial statements with management and the outside auditors, including the Company's disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations." Discuss with the outside auditors their judgments about the quality, not just the acceptability, of the Company's accounting principles as applied to its financial reporting as required by SAS 61, as modified or supplemented. Review with management and the outside auditors the basis for their reports issued under 12 C.F.R. § 363.2(b). Discuss with management and the outside auditors the financial effects of regulatory and accounting initiatives as well as off-balance sheet structures. Review disclosures to the Committee by the CEO and CFO during their certification of the Company's Forms 10-K and 10-Q regarding any significant deficiencies in the design or operation of internal controls and any fraud involving any employees who have a significant role in the Company's internal controls. Resolve any disagreements between management and the outside auditors regarding financial reporting.
2. Inclusion of Audited Financials in 10-K. Recommend to the Board whether to include the audited financial statements in the Company's Form 10-K.
3. Quarterly Financial Issues. Instruct the outside auditors to meet with and apprise the Committee Chair of any issues deemed significant by the outside auditors and related to the Company's quarterly financial results prior to the filing of the Company's Form 10-Q.
4. Other Public Communications. Discuss earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies.
Internal Control Environment
5. Internal Company Reports. Review internal reports to remain apprised of material financial exposures and management actions to address issues related to:
6. Outside Reports. Receive, retain and treat complaints regarding accounting, internal accounting controls and auditing matters and provide for confidential, anonymous submission by employees of their concerns regarding such matters.
Oversight of Auditors
8. Retention; Approval of Services. Select, evaluate, and, where appropriate, replace the outside auditors. In addition to assuring the regular rotation of the lead audit partner as required by law, also review and evaluate the lead audit partner and consider whether, in order to assure continuing auditor independence, there should be regular rotation of the firm. Exercise sole authority to approve all audit engagement fees and terms as well as all significant non-audit engagements of the outside auditors, to be approved in advance to the extent and in the manner required by law; and review the appointment and replacement of the Chief Auditor.
9. Auditor Independence. Review periodic reports regarding non-audit activities of the outside auditors and related fees, and any other disclosures required by Independence Standards Board Standard No. 1, as modified or supplemented. Discuss with the outside auditors any disclosed relationships or services that may impact their objectivity and independence and recommend that the Board take appropriate action to satisfy itself of the independence of the outside auditors in response to the auditors' reports.
10. Evaluation of Quality Controls. At least annually, obtain and review a report by the outside auditors describing the firm's internal quality-control procedures; any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues; and (to assess the auditors' independence) all relationships between the outside auditors and the Company.
11. Conduct of Audit. Receive from the outside auditors on a timely basis: their report of all critical accounting policies and practices to be used in the audit; all alternative treatments of financial information within generally accepted accounting principles discussed with management, the ramifications of such alternatives, and the treatment preferred by the outside auditors; and other material written communications between the outside auditors and management, including any management letter or schedule of unadjusted differences. Meet with the outside auditors and the Chief Auditor prior to the audit to review the planning, budget and staffing of the audit, the adequacy of the resources of the outside auditors and the internal auditors, and the appropriateness of their access within the Company in light of the scope of their work. In the course of the audit, inquire of the outside auditors as to any difficulties encountered, including any restrictions on the scope of activities or access to required information, any disagreements with management, and management's response. Obtain from the outside auditors assurance that the audit was conducted in a manner consistent with Section 10A of the Securities Exchange Act of 1934 (15 U.S.C. § 78j-1). To the extent deemed necessary or appropriate by the Committee, discuss with the outside auditors' national office issues on which it was consulted by the outside auditors as well as matters of audit quality and consistency.
12. Legal. Review with the Company's General Counsel legal matters that may have a material impact on the financial statements, the Company's compliance policies, and any material reports or inquiries received from regulators or governmental agencies.
13. Non-Company Reports. Review with management and the outside auditors correspondence with regulators or governmental agencies and employee complaints or published reports which raise material issues regarding the Company's financial statements or accounting policies.
14. Internal Reports. Review internal reports and management actions to address issues related to compliance with Company policies, including the Code of Ethics and Business Conduct.
15. Company Policies. Approve the Company's hiring policies regarding employees and former employees of the outside auditors, and review and discuss significant changes in the Company's policies related to:
16. Committee Report. Include in the Company's annual proxy statement the Committee report required by the rules of the Securities and Exchange Commission.
17. Bank Audit Committee. Perform the audit committee functions specified by 12 .F.R. Part 363 for depository institution subsidiaries of the Company and act as a fiduciary audit committee in accordance with 12 C.F.R. § 9.9 on behalf of the national bank subsidiaries of the Company that have fiduciary powers. Meet with regulators when requested by regulators or deemed necessary or appropriate by the Committee.
COMMITTEE CHARTER AND PERFORMANCE EVALUATION:
The Committee shall review and assess the adequacy of this Charter annually. The Committee may recommend amendments to this Charter at any time and submit amendments for approval to the Board. The Committee shall also conduct an annual performance evaluation of the Committee.
In discharging its oversight responsibilities, the Committee is authorized to retain and obtain advice from legal, accounting, or other experts or consultants at its discretion and at the Company's expense without prior permission of the Board of Directors or management.