Pottery Barn 2008 Annual Report Download - page 162

• The 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 non-audit
services, provided that decisions of such subcommittee to grant pre-approvals shall be presented to the
full Committee at its next scheduled meeting.
• The Committee shall have the authority, to the extent it deems necessary or appropriate, to retain
independent legal, accounting or other advisors. The Company shall provide for appropriate funding, as
determined by the 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 Committee.
• The Committee shall make regular reports to the Board, which reports shall include any issues that arise
with respect to the quality or integrity of the Company’s financial statements, the Company’s compliance
with legal or regulatory requirements, the performance and independence of the Company’s independent
auditor, the performance of the internal audit function, and any other matters that the Committee deems
appropriate or is requested to be included by the Board.
• The Committee shall review and reassess the adequacy of this Charter annually and recommend any
proposed changes to the Board for approval. The Committee shall annually review the Committee’s own
performance.
In addition to the responsibilities outlined elsewhere in this Charter, the Committee shall perform such other
specific functions as the Company’s Board may from time to time direct, and make such investigations and
reviews of the Company and its operations as the Chief Executive Officer or the Board may from time to time
request.
The Committee shall:
Financial Statement and Disclosure Matters
• Review and discuss with management and the independent auditor the annual audited financial statements
and quarterly financial statements, including disclosures made in “Management’s Discussion and
Analysis of Financial Condition and Results of Operations,” prior to filing the Company’s Annual Report
on Form 10-K and Quarterly Reports on Form 10-Q, respectively, with the SEC.
• Discuss with management and the independent auditor significant financial reporting issues and
judgments made in connection with the preparation of the Company’s financial statements, including the
review of (a) major issues regarding accounting principles and financial statement presentations,
including any significant changes in the Company’s selection or application of accounting principles, and
major issues as to the adequacy of the Company’s internal controls and any special audit steps adopted in
light of material control deficiencies; and (b) analyses prepared by management and/or the independent
auditor setting forth significant financial reporting issues and judgments made in connection with the
preparation of the financial statements.
• Review and discuss quarterly reports from the independent auditor on:
• All critical accounting policies and practices to be used.
• All alternative treatments of financial information within generally accepted accounting principles
(“GAAP”) that have been discussed with management, ramifications of the use of such alternative
disclosures and treatments, and the treatment preferred by the independent auditor.
• Other material written communications between the independent auditor and management, such as
any management letter or schedule of unadjusted differences.
• Review with management the Company’s earnings press releases, including the proposed use of any “pro
forma” or “adjusted” non-GAAP information, as well as financial information and earnings guidance
provided to investors. Such review may be done generally (consisting of discussing the types of
information to be disclosed and the types of presentations to be made).
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