Freddie Mac 2012 Annual Report Download - page 372

Mr. Renzi’s relationship with Ally and its affiliates was not required to be reviewed, approved or ratified under our
Related Person Transactions Policy because Mr. Renzi, in his capacity as an employee, was recused from any involvement in
transactions with or decisions relating to Ally and its affiliates for the period that he received payments on unpaid stock units.
For this reason, Mr. Renzi did not have a material interest in our relationship with Ally or its affiliates.
Conservatorship Agreements
Treasury, FHFA, and the Board of Governors of the Federal Reserve System have taken a number of actions to support
us during conservatorship, including entering into the Purchase Agreement, described in this Form 10-K. See
“BUSINESS — Conservatorship and Related Matters — Treasury Agreements,” “BUSINESS — Conservatorship and
Government Support for our Business” and “NOTE 2: CONSERVATORSHIP AND RELATED MATTERS — Related
Parties as a Result of Conservatorship.”
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Description of Fees
The following is a description of fees billed to us by PricewaterhouseCoopers LLP, our independent public accountants,
during 2012 and 2011.
Table 96 — Auditor Fees(1)
2012 2011
Audit Fees(2) ............................................................................ $30,651,367 $25,617,867
Audit-Related Fees(3) ...................................................................... 76,119 8,725
Tax Fees(4) ............................................................................. 109,250 3,040,750
All Other Fees(5) ......................................................................... — 11,399
Total ................................................................................. $30,836,736 $28,678,741
(1) These fees represent amounts billed within the designated year and include reimbursable expenses of $365,016 and $283,246 for 2012 and 2011,
respectively.
(2) Audit fees include fees and reimbursable expenses billed by PricewaterhouseCoopers LLP in connection with the SAS 100 quarterly reviews of our
interim financial information and the audit of our annual consolidated financial statements. The audit fees billed during 2012 include fees and
reimbursable expenses related to the 2012 ($19,911,326) and 2011 ($10,740,041) audits. In addition to the amounts shown above, approximately $10.4
million of fees and reimbursable expenses will be billed in 2013 for the 2012 audit. The audit fees billed during 2011 include fees and reimbursable
expenses related to the 2011 ($17,715,607) and 2010 ($7,902,260) audits. Audit fees of $84,500 and $102,020 in 2012 and 2011, respectively, related to
the Freddie Mac Foundation are excluded because these fees are incurred and paid separately by the Freddie Mac Foundation.
(3) The 2012 and 2011 audit-related fees resulted from renewals of our Comperio subscription ($9,000 and $8,725, respectively). The 2012 audit-related
fees also include fees billed by PricewaterhouseCoopers LLP for the performance of certain agreed-upon procedures regarding aspects of compliance
with the Purchase Agreement covenants ($67,119).
(4) The tax fees billed in 2012 related to non-audit tax advisory services to provide assistance with the Internal Revenue Service tax audit matters, including
information requests and associated responses. The tax fees billed in 2011 related to non-audit tax compliance services and primarily related to the
preparation of the company’s 2010 tax return.
(5) All other fees for 2011 resulted from fees billed by PricewaterhouseCoopers LLP for the performance of non-audit advisory services related to a
preliminary assessment of certain aspects of the company’s technology implementation ($11,399).
Approval of Independent Auditor Services and Fees
As provided in its charter, the Audit Committee appoints, subject to FHFA approval, our independent public accounting
firm and reviews the scope of the annual audit and pre-approves, subject (as required) to FHFA approval, all audit and non-
audit services permitted under applicable law to be performed by the independent public accounting firm.
The Sarbanes-Oxley Act and related rules adopted by the SEC require that all services provided to companies subject to
the reporting requirements of the Exchange Act by their independent auditors be pre-approved by their audit committee or by
authorized members of the committee, with certain exceptions. The Audit Committee’s charter requires that the Audit
Committee pre-approve any audit services, and any non-audit services permitted under applicable law, to be performed by
our independent auditors (or to designate one or more members of the Audit Committee to pre-approve such services and
report such pre-approval to the Audit Committee).
Audit services that are within the scope of an auditor’s engagement approved by the Audit Committee prior to the
performance of those services are deemed pre-approved and do not require separate pre-approval. Audit services not within
the scope of an Audit Committee-approved engagement, as well as permissible non-audit services, must be separately pre-
approved by the Audit Committee.
367 Freddie Mac