Pep Boys 2011 Annual Report Download - page 18

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transactions between the Company and another party are reviewed by the Company’s legal and finance departments
prior to the execution of definitive transaction documents and (ii) each director and executive officer completes a
questionnaire that requires the disclosure of any transaction or relationship that the person, or any member of his or
her immediate family, has or will have with the Company. The full Board of Directors reviews and approves,
ratifies or rejects any transactions and relationships of the nature that would be required to be disclosed under Item
404 of Regulation S-K. In reviewing any such related-party transaction or relationship, the Board considers such
information as it deems important to determine whether the transaction is on reasonable and competitive terms and is
fair to the Company. No such relationships or transactions of a nature required to be disclosed under Item 404 of
Regulation S-K currently exist.
Involvement of Certain Legal Proceedings
None of our directors or executive officers are currently involved, or have been involved during the last ten
years, in a legal proceeding of the type required to be disclosed under Item 402 of Regulation S-K.
Report of the Audit Committee of the Board of Directors
The Audit Committee reviews Pep Boys’ financial statements and makes recommendations to the full Board of
Directors on matters concerning the audits of Pep Boys’ books and records. Each committee member is
“independent” as defined by the listing standards of the New York Stock Exchange. Ms. Scaccetti (chair), Mr. Hotz,
Mr. Reid and Mr. Williams are the current members of the Audit Committee. Ms. Scaccetti hasbeen designated by
the full Board as an Audit Committee Financial Expert as defined by SEC regulations. A written charter adopted by
the full Board governs the activities of the Audit Committee. The charter is reviewed, and when necessary revised,
annually.
Management has primary responsibility for Pep Boys’ internal accounting controls and financial reporting
process. The independent registered public accounting firm is responsible for performing an independent audit of
Pep Boys’ consolidated financial statements and internal control over financial reporting in accordance with
standards of the Public Company Accounting Oversight Board (United States) and to issue a report as a result of
such audits. The Audit Committee’s responsibility is to monitor and oversee these processes. The Audit Committee
serves as a focal point for communication among the Board of Directors and its committees, the independent
registered public accounting firm, management and Pep Boys’ internal audit function, as the respective duties of such
groups, or their constituent members, relate to Pep Boys’ financial accounting and reporting and to its internal
controls.
In this context, the Audit Committee reviewed and discussed the audited consolidated financial statements with
management and the independent registered public accounting firm. These discussions included the matters required
to be discussed by Statement on Auditing Standards No. 61, as amended and adopted by the Public Company
Accounting Oversight Board (Communication with Audit Committees). The Audit Committee also reviewed and
discussed with management, the internal auditors and the independent registered public accounting firm,
management’s report, and the independent registered public accounting firm’s attestation, on internal control over
financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002.
The Audit Committee also discussed with the independent registered public accounting firm its independence
from Pep Boys and its management, including the written disclosures submitted to the Audit Committee by the
independent registered public accounting firm as required by the Public Company Accounting Oversight Board.
Based upon the discussions and reviews referred to above, the Audit Committee, as then constituted,
recommended that the Board of Directors include the audited consolidated financial statements and management’s
report on internal control over financial reporting in Pep Boys’ Annual Report on Form 10-K for the fiscal year
ended January 28, 2012 filed with the SEC.
This report is submitted by: Jane Scaccetti; Robert H. Hotz; Irvin D. Reid; and James A. Williams.