SanDisk 2005 Annual Report Download - page 34

Proxy Statement
asking the Company's stockholders to ratify this appointment. The affirmative vote of the holders of a majority
of the shares present or represented by proxy at the meeting and entitled to vote on this Proposal No. 4 will be
required to ratify the selection of Ernst & Young LLP.
In the event the stockholders fail to ratify the appointment, the Audit Committee of the Board of
Directors will reconsider its appointment of Ernst & Young LLP as the Company's independent registered
public accounting firm for the fiscal year ending December 31, 2006. Even if this appointment is ratified, the
Audit Committee, in its discretion, may direct the appointment of a different independent registered public
accounting firm at any time during the year if the Audit Committee determines that such a change would be
in the best interest of the Company and its stockholders.
Ernst & Young LLP has audited the Company's financial statements annually since 1991. Its
representatives are expected to be present at the Annual Meeting, will have the opportunity to make a
statement if they desire to do so, and will be available to respond to appropriate questions.
Principal Accountant Fees and Services
The following is a summary of the payments made by the Company to Ernst & Young LLP for
professional services rendered during the 2005 and 2004 fiscal years:
2005 2004
(a) Audit FeesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $1,546,000 $1,355,000
(b) Audit Related Fees ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 101,000 221,000
(c) Tax Fees ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 230,000 416,000
(d) All Other Fees ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 5,000 30,000
(a) Audit fees consist of professional services provided in connection with the audit of the Company's
financial statements and review of the Company's quarterly financial statements. These audit fees also
include professional services provided in connection with the annual audit of the Company's internal
control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act of 2002, the audit
of the Company's employee benefit plan and other statutory audits of subsidiaries or affiliates of the
Company.
(b) Audit related fees consist primarily of accounting consultations, services provided in connection with
regulatory filings, technical accounting guidance and other attestation services.
(c) For fiscal years 2005 and 2004, tax fees principally included tax compliance fees, including expatriate
compliance services. Total compliance fees were $221,000 and $360,000 for 2005 and 2004, respectively.
Tax fees also include tax advice and tax planning fees of $9,000 and $56,000 for fiscal 2005 and 2004,
respectively.
(d) All other fees includes online research tools and other services.
All of the 2005 services described above were pre-approved by the Audit Committee to the extent
required by Section 10A of the Securities Exchange Act of 1934, which requires audit committee pre-approval
of audit and non-audit services provided by the Company's independent auditors. In accordance with
Section 10A under the Securities Exchange Act of 1934, the Audit Committee may delegate to any member
of the Audit Committee (referred to as the ""Audit Committee Delegate'') the authority to pre-approve
services not prohibited by law to be performed by the Company's independent auditors. The Audit Committee
has appointed Catherine P. Lego as the Audit Committee Delegate and as such, Ms. Lego reports any
decision to pre-approve permissible services to the full Audit Committee at its next regular meeting. In
addition, from time to time, the Audit Committee has adopted and/or revised a Pre-Approval Policy under
which particular services or categories of services are pre-approved, subject to certain specified maximum
dollar amounts. Such pre-approval is generally granted for a term of twelve months from the date of pre-
approval and automatically renews at the end of the one-year period unless revoked or revised by the Audit
Committee.
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