Audit Committee Charter

AS AMENDED JUNE 14, 2004.

The Audit Committee shall be appointed by the Board of Directors to assist the Board in fulfilling its oversight responsibilities relating to the Company’s (1) financial statements and auditing, accounting and related reporting processes and (2) systems of internal controls regarding finance, accounting, legal compliance and ethics established by management and the Board.

COMPOSITION

The Audit Committee shall consist of at least three members of the Board, each of whom shall meet the independence and experience requirements of applicable laws, regulations, and stock market rules, The members of the Audit Committee shall be appointed by the Board at the annual organizational meeting of the Board, to serve until their successors shall be duly elected and qualified. Unless a Chair is elected by the full Board, the members of the Committee may designate a Chair by majority vote of the full Committee membership.

RESPONSIBILITIES

The Audit Committee shall:

Documents/Reports Review

  • Review the annual audited financial statements with management and the independent auditors, including major issues regarding accounting and auditing principles and practices as well as the adequacy of internal controls that could significantly affect the Company’s financial statements, and recommend that the audited financial statements be included in the Company’s Annual Report on Form 10-K.
  • Review with management and the independent auditors the Company’s quarterly financial statements.
  • Review with management and the independent auditors the significant financial reporting issues and judgments made in connection with the preparation of the Company’s financial statements and discuss any other matters communicated to the Committee by the independent auditors.
  • Prepare the report of the Audit Committee required by the rules of the Securities and Exchange Commission to be included in the Company’s annual proxy statement.

Accounting and Financial Controls Framework

  • Review major changes to the Company’s auditing and accounting principles and practices as suggested by the independent auditors.

Review with the independent auditors any management letter provided by the independent auditors and the Company’s responses to that letter. Such review should include:

  • Any difficulties encountered in the course of the audit work, including any restrictions on the scope of activities or access to required information.
  • Any changes required in the planned scope of the audit.
  • The financial reporting department responsibilities and staffing.

Independent Auditors

  • Exercise direct responsibility for the appointment, compensation, retention, and oversight of the work of any registered public accounting firm engaged, including resolution of disagreements between management and the auditor regarding financial reporting, for the purpose of preparing or issuing an audit report or performing other audit, review, ore attest services for the Company, and assure that each such firm report directly to the Committee..
  • Approve the fees to be paid to the independent auditors.
  • Assure receipt from the outside auditors of a formal written statement delineating all relationships between the auditor and the Company consistent with Independence Standards Board Standard No. 1, and actively engage in a dialogue with the auditor with respect to any disclosed relationships or services that may impact the objectivity and independence of the auditor and for taking, or recommending that the full Board take appropriate action to oversee the independence of the outside auditor.
  • Evaluate together with the Board the performance of the independent auditors and, if so determined by the Audit Committee, recommend that the Board replace the independent auditors.
  • Meet with the independent auditors prior to the audit to review the planning and staffing of the audit.
  • Discuss with the independent auditors the matters required to be discussed by Statement on Auditing Standards No. 61 relating to the conduct of the audit.

GENERAL AUTHORITY AND RESPONSIBILITIES

The Audit Committee shall have the authority to retain special legal, accounting or other consultants to advise the Committee. The Audit Committee may request any officer or employee of the Company or the Company’s outside counsel or independent auditors to attend a meeting of the Committee or to meet with any members of, or consultants to, the Committee. The Company shall provide appropriate funding, as determined by the Audit Committee in its capacity as a committee of the Board of Directors, for payment of compensation to any registered public accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit, review, or attest services for the Company; for compensation to any legal, accounting or other consultants retained or employed by the Committee; and for payment of ordinary administrative expenses of the Audit Committee that are necessary or appropriate in carrying out its duties.

The Audit Committee shall establish procedures for the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters, and the confidential anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters.

The Audit Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board.