Pier 1 2016 Annual Report Download - page 130

AUDIT MATTERS
Relationship with Independent Registered Public Accounting Firm
The audit committee is directly responsible for the appointment, compensation, retention and oversight of Pier 1 Imports’ independent
registered public accounting firm. As described below, the audit committee has approved the engagement of Ernst & Young LLP as Pier
1 Imports’ independent registered public accounting firm for fiscal 2017.
The audit committee engaged Ernst & Young LLP as Pier 1 Imports’ independent registered public accounting firm for fiscal 2016 and
the shareholders ratified that engagement at the annual meeting of the shareholders held on June 25, 2015. A representative of Ernst &
Young LLP is expected to be present at the annual meeting of shareholders and will be given the opportunity to make a statement if he
or she so desires and to respond to appropriate questions from shareholders.
PROPOSAL NO. 3 – Ratification of Engagement of Ernst & Young LLP
A proposal to ratify the audit committee’s engagement of Ernst & Young LLP as Pier 1 Imports’ independent registered public
accounting firm for fiscal 2017.
The audit committee has approved engaging Ernst & Young LLP as Pier 1 Imports’ independent registered public accounting firm for
fiscal 2017. Ernst & Young LLP served as Pier 1 Imports’ independent registered public accounting firm for fiscal 2016 and has served in
that capacity since fiscal 1996. Although approval or ratification of such engagement is not required, Pier 1 Imports is seeking the
shareholders’ ratification of the audit committee’s engagement of Ernst & Young LLP because the board of directors and management
believe that allowing shareholders to express their view on the matter is good corporate governance. SEC and NYSE rules require that
the audit committee “…must be directly responsible for the appointment…of any registered public accounting firm.…” While
shareholder ratification is not binding on Pier 1 Imports, any failure of the shareholders to ratify the audit committee’s engagement of
Ernst & Young LLP as Pier 1 Imports’ independent registered public accounting firm would be considered by the audit committee in
engaging Ernst & Young LLP for future services.
The affirmative vote of a majority of the shares of common stock present in person or represented by proxy at the annual meeting and
entitled to vote on this proposal is required to ratify the engagement of Ernst & Young LLP as Pier 1 Imports’ independent registered
public accounting firm for fiscal 2017. Abstentions will be counted as represented and entitled to vote on this proposal and will have the
effect of a vote “Against” the proposal.
The board of directors unanimously recommends a vote “For” the ratification of the audit
committee’s engagement of Ernst & Young LLP as Pier 1 Imports’ independent registered public
accounting firm for fiscal 2017.
Independent Registered Public Accounting Firm Fees
The following table presents fees incurred for professional services rendered by Ernst & Young LLP, Pier 1 Imports’ independent
registered public accounting firm, for fiscal years ended February 27, 2016 and February 28, 2015.
FEBRUARY 27, 2016 FEBRUARY 28, 2015
Audit Fees (1) $1,061,000 $1,020,000
(1) Includes fees for services related to the annual audit of the consolidated financial
statements, required statutory audits, if any, reviews of Pier 1 Imports’ quarterly
reports on Form 10-Q, the independent registered public accounting firm’s
report on Pier 1 Imports’ internal control over financial reporting, as required
under Section 404 of the Sarbanes-Oxley Act of 2002, and any registration
statements during the respective periods.
(2) Includes fees for services related to the Pier 1 Imports, Inc. Stock Purchase Plan
and Pier 1 Imports’ consolidated balance sheet audits.
(3) Includes fees for services related to tax compliance, tax advice and tax planning.
(4) Includes fees for subscription to online research tool.
Audit Related Fees (2) $ 28,000 $ 28,000
Tax Fees (3) $ 42,980 $ 28,600
All Other Fees (4) $ 2,800 $ 2,800
Total Fees $1,134,780 $1,079,400
Pre-approval of Non-audit Fees
The audit committee has adopted a policy that requires advance approval of all audit, audit related, tax and other services performed by
the independent registered public accounting firm. The policy provides for pre-approval by the audit committee of specifically defined
audit, audit related and tax services. Unless the specific service has been previously pre-approved with respect to a fiscal year, the audit
committee must approve the permitted service before the independent registered public accounting firm is engaged to perform it. The
audit committee has delegated to the chair of the audit committee, or any of its other members, authority to approve permitted services
up to $50,000 per engagement provided that any pre-approval decisions are reported to the committee at its next scheduled meeting.
48 PIER 1 IMPORTS, INC. | 2016 Proxy Statement