2003 Committee Charter : JOYG
AUDIT COMMITTEE CHARTER
The Audit Committee is appointed by the Board to assist the Board in monitoring (1) the
integrity of the financial statements of the Corporation, (2) the independent auditor's
qualifications and independence, (3) the performance of the Corporation's internal audit
function and independent auditors, and (4) the compliance by the Corporation with legal
and regulatory requirements.
The Audit Committee shall prepare the report required by the rules of the Securities and
Exchange Commission (the "Commission") to be included in the Corporation's annual
The Audit Committee shall consist of no fewer than three members. The members of the
Audit Committee shall meet the independence and experience requirements of each stock
exchange or market on which the Corporation's securities are listed, Section 10A(m)(3)
of the Securities Exchange Act of 1934 (the "Exchange Act") and the rules and
regulations of the Commission. All members of the Audit Committee shall have a
working familiarity with basic finance and accounting practices and at least one member
of the Audit Committee shall be a financial expert as defined by the Commission. Audit
committee members shall not simultaneously serve on the audit committees of more than
two other public companies.
The members of the Audit Committee shall be appointed by the Board on the
recommendation of the Human Resources Committee. Audit Committee members may
be replaced by the Board. Unless the Chair is designated by the Board, the members of
the Audit Committee may designate a Chair by majority vote of the full Audit Committee
The Audit Committee shall meet as often as it determines, but not less frequently than
quarterly. The Audit Committee shall meet periodically with management, the internal
auditors and the independent auditor in separate executive sessions. The Audit
Committee may request any officer or employee of the Corporation or the Corporation's
outside counsel or independent auditor to attend a meeting of the Committee or to meet
with any members of, or consultants to, the Committee.
Committee Authority and Responsibilities
The Audit Committee shall have the sole authority to appoint or replace the independent
auditor. The Audit Committee shall be directly responsible for the compensation and
oversight of the work of the independent auditor (including resolution of disagreements
between management and the independent auditor regarding financial reporting) for the
purpose of preparing or issuing an audit report or related work. The independent auditor
shall report directly to the Audit Committee.
The Audit Committee shall pre-approve all auditing services and permitted non-audit
services (including the fees and terms thereof) to be performed for the Corporation by its
independent auditor, subject to the de minimus exceptions for non-audit services
described in Section 10A(i)(1)(B) of the Exchange Act which are approved by the Audit
Committee prior to the completion of the audit. The Audit Committee may form and
delegate authority to subcommittees consisting of one or more members when
appropriate, including the authority to grant pre-approvals of audit and permitted nonaudit
services, provided that decisions of such subcommittee to grant pre-approvals shall
be presented to the full Audit Committee at its next scheduled meeting.
The Audit Committee shall have the authority, to the extent it deems necessary or
appropriate, to retain independent legal, accounting or other advisors. The Corporation
shall provide for appropriate funding, as determined by the Audit Committee, for
payment of compensation to the independent auditor for the purpose of rendering or
issuing an audit report and to any advisors employed by the Audit Committee.
The Audit Committee shall make regular reports to the Board. The Audit Committee
shall review and reassess the adequacy of this Charter annually and recommend any
proposed changes to the Board for approval. The Audit Committee shall annually review
the Audit Committee's own performance.
The Audit Committee, to the extent it deems necessary or appropriate, shall:
Financial Statement and Disclosure Matters
1. Review and discuss with management and the independent auditor the annual
audited financial statements, including disclosures made in management's
discussion and analysis, and recommend to the Board whether the audited
financial statements should be included in the Corporation's Form 10-K.
2. Review and discuss with management and the independent auditor the
Corporation's quarterly financial statements prior to the filing of its Form 10-Q,
including the results of the independent auditor's review of the quarterly financial
3. Discuss with management and the independent auditor significant financial
reporting issues and judgments made in connection with the preparation of the
Corporation's financial statements, including any significant changes in the
Corporation's selection or application of accounting principles, any major issues
as to the adequacy of the Corporation's internal controls and any special steps
adopted in light of material control deficiencies.
4. Review and discuss reports from the independent auditors on:
(a) All critical accounting policies and practices to be used.
(b) All alternative treatments of financial information within generally
accepted accounting principles that have been discussed with
management, ramifications of the use of such alternative disclosures and
treatments, and the treatment preferred by the independent auditor.
(c) Other material written communications between the independent auditor
and management, such as any management letter or schedule of
5. Discuss with management the Corporation's earnings press releases, as well as
financial information and earnings guidance provided to investors, analysts and
rating agencies. Such discussion may be done generally (consisting of discussing
the types of information to be disclosed and the types of presentations to be
6. Discuss with management and the independent auditor the effect of regulatory
and accounting initiatives as well as off-balance sheet structures on the
Corporation's financial statements.
7. Discuss with management the Corporation's major financial risk exposures and
the steps management has taken to monitor and control such exposures, including
the Corporation's risk assessment and risk management policies.
8. Discuss with the independent auditor the matters required to be discussed by
Statement on Auditing Standards No. 61 relating to the conduct of the audit,
including any difficulties encountered in the course of the audit work, any
restrictions on the scope of activities or access to requested information, and any
significant disagreements with management.
9. Review disclosures made to the Audit Committee by the Corporation's CEO and
CFO during their certification process for the Form 10-K and Form 10-Q about
any significant deficiencies in the design or operation of internal controls or
material weaknesses therein and any fraud involving management or other
employees who have a significant role in the Corporation's internal controls.
Oversight of the Corporation's Relationship with the Independent Auditor
10. Review and evaluate the lead partner of the independent auditor team.
11. Obtain and review a report from the independent auditor at least annually
regarding (a) the independent auditor's internal quality-control procedures, (b)
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, (c) any steps taken to deal with any
such issues, and (d) all relationships between the independent auditor and the
Corporation. Evaluate the qualifications, performance and independence of the
independent auditor, including considering whether the auditor's quality controls
are adequate and the provision of permitted non-audit services is compatible with
maintaining the auditor's independence, and taking into account the opinions of
management and internal auditors. The Audit Committee shall present its
conclusions with respect to the independent auditor to the Board.
12. Ensure the rotation of the lead (or coordinating) audit partner having primary
responsibility for the audit and the audit partner responsible for reviewing the
audit as required by law. Consider whether, in order to assure continuing auditor
independence, it is appropriate to adopt a policy of rotating the independent
auditing firm on a regular basis.
13. Recommend to the Board policies for the Corporation's hiring of employees or
former employees of the independent auditor who participated in any capacity in
the audit of the Corporation.
14. Review with the independent auditor (i) matters of audit quality and consistency
on which the Corporation's audit team consulted with its national office and (ii)
any other significant issues on which the Corporation's audit team consulted with
its national office. Consult with the national office of the independent auditor as
the Committee determines to be appropriate.
15. Meet with the independent auditor prior to the audit to discuss the planning and
staffing of the audit.
Oversight of the Corporation's Internal Audit Function
16. Review the appointment and replacement of the senior internal auditing
17. Review the significant reports to management prepared by the internal auditing
department and management's responses.
18. Discuss with the independent auditor and management the internal audit
department responsibilities, budget and staffing and any recommended changes in
the planned scope of the internal audit.
Compliance Oversight Responsibilities
19. Obtain from the independent auditor assurance that Section 10A(b) of the
Exchange Act has not been implicated.
20. Obtain reports from management, the Corporation's senior internal auditing
executive and the independent auditor that the Corporation and its
subsidiary/foreign affiliated entities are in conformity with applicable legal
requirements, the Corporation's Code of Ethics for the CEO and Senior Financial
Officers, and the Corporation's Worldwide Business Conduct Policy. Review
reports and disclosures of insider and affiliated party transactions. Advise the
Board with respect to the Corporation's policies and procedures regarding
compliance with applicable laws and regulations, with the Corporation's Code of
Ethics for the CEO and Senior Financial Officers, and with the Corporation's
Worldwide Business Conduct Policy.
21. Establish procedures for the receipt, retention and treatment of complaints
received by the Corporation regarding accounting, internal accounting controls or
auditing matters, and the confidential, anonymous submission by employees of
concerns regarding questionable accounting or auditing matters.
22. Discuss with management and the independent auditor any correspondence with
regulators or governmental agencies and any published reports which raise
material issues regarding the Corporation's financial statements or accounting
23. Discuss with the Corporation's General Counsel legal matters that may have a
material impact on the financial statements or the Corporation's compliance
Limitation of Audit Committee's Role
While the Audit Committee has the responsibilities and powers set forth in this Charter, it
is not the duty of the Audit Committee to plan or conduct audits or to determine that the
Corporation's financial statements and disclosures are complete and accurate and are in
accordance with generally accepted accounting principles and applicable rules and
regulations. These are the responsibilities of management and the independent auditor.