Pizza Hut 2013 Annual Report Download - page 84

YUM! BRANDS, INC.-2014Proxy Statement62
Proxy Statement
AUDIT COMMITTEE REPORT
Who serves on the Audit Committee of the Board of Directors?
The members of the Audit Committee are Mirian Graddick-
Weir, J. David Grissom, Bonnie Hill, Jonathan S. Linen and
Thomas C. Nelson, Chair.
The Board of Directors has determined that all of the
members of the Audit Committee are independent within
the meaning of applicable SEC regulations and the listing
standards of the NYSE and that Mr. Nelson, the chair of
the Committee, is qualified as an audit committee financial
expert within the meaning of SEC regulations. The Board
has also determined that Mr. Nelson has accounting and
related financial management expertise within the meaning
of the listing standards of the NYSE and that each member
is financially literate within the meaning of the NYSE listing
standards.
What document governs the activities of the Audit Committee?
The Audit Committee operates under a written charter
adopted by the Board of Directors. The Committee’s
responsibilities are set forth in this charter, which was
amended and restated effective November 22, 2013. The
charter is reviewed by management at least annually, and
any recommended changes are presented to the Audit
Committee for review and approval. The charter is available
on our Web site at www.yum.com/investors/governance/
charters.asp.
What are the responsibilities of the Audit Committee?
The Audit Committee assists the Board in fulfilling its
responsibilities for general oversight of the integrity of
the Company’s financial statements, the adequacy of the
Company’s system of internal controls and procedures
and disclosure controls and procedures, the Company’s
risk management, the Company’s compliance with legal
and regulatory requirements, the independent auditors’
qualifications and independence and the performance of
the Company’s internal audit function and independent
auditors. The Committee has sole authority over the selection
of the Company’s independent auditors and manages the
Company’s relationship with its independent auditors (who
report directly to the Committee). The Committee has the
authority to obtain advice and assistance from outside legal,
accounting or other advisors as the Committee deems
necessary to carry out its duties and receive appropriate
funding, as determined by the Committee, from the Company
for such advice and assistance.
The Committee met 9 times during 2013. The Committee
schedules its meetings with a view to ensuring that it devotes
appropriate attention to all of its tasks. The Committee’s
meetings generally include private sessions with the
Company’s independent auditors and with the Company’s
internal auditors, in each case without the presence of the
Company’s management, as well as executive sessions
consisting of only Committee members. In addition to the
scheduled meetings, senior management confers with
the Committee or its Chair from time to time, as senior
management deems advisable or appropriate, in connection
with issues or concerns that arise throughout the year.
Management is responsible for the Company’s financial
reporting process, including its system of internal control
over financial reporting, and for the preparation of
consolidated financial statements in accordance with
accounting principles generally accepted in the U.S. The
Company’s independent auditors are responsible for
auditing those financial statements in accordance with
professional standards and expressing an opinion as to
their material conformity with U.S. generally accepted
accounting principles and for auditing the effectiveness
of the Company’s internal control over financial reporting.
The Committee’s responsibility is to monitor and review
the Company’s financial reporting process and discuss
management’s report on the Company’s internal control
over financial reporting. It is not the Committee’s duty or
responsibility to conduct audits or accounting reviews or
procedures. The Committee has relied, without independent
verification, on management’s representations that the
financial statements have been prepared with integrity and
objectivity and in conformity with accounting principles