LeapFrog 2008 Annual Report Download - page 127

Messrs. Simon and Marinelli were appointed to the Nominating and Corporate Governance Committee and
Compensation Committee, respectively, in March 2008. While the board did not conclude that such directors
were “independent” as defined in the NYSE listing standards, these committees are not required to be composed
entirely of independent directors because we are a “controlled company,” as discussed in more detail above under
“Independence of the Board of Directors.”
AUDIT COMMITTEE
The audit committee of our board of directors was established by our board in accordance with Section
(3)(a)(58)(A) of the Securities Exchange Act of 1934, as amended, or the 1934 Act, and oversees our corporate
accounting and financial reporting process and the audits of our financial statements. For this purpose, the audit
committee performs several functions. Among other things, the audit committee:
• evaluates the performance of and assesses the qualifications of the independent registered public
accounting firm;
• determines the engagement of the independent registered public accounting firm;
• determines whether to retain or terminate the existing independent registered public accounting firm or
to appoint and engage a new independent registered public accounting firm;
• reviews and approves the retention of the independent registered public accounting firm to perform any
proposed permissible non-audit services;
• monitors the rotation of partners of the independent registered public accounting firm on LeapFrog’s
engagement team as required by law;
• confers with management and the independent registered public accounting firm regarding the
effectiveness of internal control over financial reporting;
• reviews, assesses and approves the annual audit plan for LeapFrog’s internal audit function;
• establishes procedures, as required under applicable law, for the receipt, retention and treatment of
complaints received by us regarding accounting, internal accounting controls or auditing matters and
the confidential and anonymous submission by employees of concerns regarding questionable
accounting or auditing matters;
• reviews the financial statements to be included in LeapFrog’s annual report on Form 10-K and
quarterly reports on Form 10-Q and other financial disclosures; and
• discusses with management and the independent registered public accounting firm the results of the
annual audit and the results of LeapFrog’s quarterly financial statements.
The audit committee is currently composed of three directors: Messrs. McKee (Chairman), Maron and
Wang. The audit committee met 10 times during our 2008 fiscal year. The board has determined that all members
of LeapFrog’s audit committee are independent (as independence is defined in Section 303A.02 of the NYSE
listing standards). The audit committee has adopted a written audit committee charter that is posted on our
website at www.leapfrog.com under About Us—Investor Relations—SEC Filings.
Our board of directors has determined that Mr. McKee, the Chairman of our audit committee, and Mr. Wang
each qualify as an “audit committee financial expert,” as defined in applicable SEC rules. The board made a
qualitative assessment of Messrs. McKee’s and Wang’s level of knowledge and experience based on a number of
factors, including their formal education and experience, in the case of Mr. McKee, as a chief financial officer for
a public reporting company, and in the case of Mr. Wang, as chief financial officer for various privately held
companies and as the chair of the audit committee of a public reporting company.
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