LeapFrog 2008 Annual Report Download - page 128

REPORT OF THE AUDIT COMMITTEE1
The audit committee consists of three directors, each of whom is an independent director in accordance with
the rules and regulations of the NYSE.
The responsibilities of the audit committee include selecting an accounting firm to be engaged as
LeapFrog’s independent registered public accounting firm and pre-approving any non-audit services provided by
LeapFrog’s independent registered public accounting firm. Additionally, and as appropriate, the audit committee
reviews and evaluates, and discusses and consults with LeapFrog management, LeapFrog internal audit personnel
and the independent registered public accounting firm regarding the following:
• the plan for, and the independent registered public accounting firm’s report on, each audit of
LeapFrog’s consolidated financial statements;
• LeapFrog’s financial disclosure documents, including all financial statements, and reports filed with
the SEC or sent to stockholders;
• changes in LeapFrog’s accounting practices, principles, controls or methodologies, or in LeapFrog’s
financial statements;
• significant developments in accounting rules;
• the internal audit function, including its plans, activities, personnel, processes for reporting and
detecting errors, non-compliance with applicable law and policies, and fraud;
• the adequacy of LeapFrog’s internal accounting controls, and accounting, financial and auditing
personnel; and
• the establishment and maintenance of an environment at LeapFrog that promotes ethical behavior.
Monitoring of Integrity of Financial Statements
The audit committee is responsible for recommending to the board of directors that LeapFrog’s financial
statements be included in LeapFrog’s annual reports. In fulfilling this responsibility, prior to each of the releases
of our financial results for 2008, the audit committee reviewed the quarterly and annual financial statements and
discussed the financial statements with management and Ernst & Young LLP, the company’s independent
registered public accounting firm. At each of its meetings to discuss financial statements, management
represented to the audit committee that the company’s consolidated financial statements were prepared in
accordance with generally accepted accounting principles. The audit committee discussed with management the
significant accounting policies utilized by the company, the reasonableness of significant judgments and the
clarity of disclosures in the financial statements. At each of these meetings to review the financial results, the
audit committee met separately with the independent registered public accounting firm to review the results of its
examination and the overall quality of the company’s financial and accounting reporting. In relation to the
audited consolidated financial statements for 2008, the audit committee reviewed and discussed with
Ernst & Young LLP the matters required to be discussed by Statement on Auditing Standards No. 114, The
Auditor’s Communication with Those Charged with Governance, as adopted by the Public Company Accounting
Oversight Board (“PCAOB”) in Rule 3200T.
Based on the discussions with management and Ernst & Young LLP concerning the audit, the audit
committee’s review of the representations of management and the report of the independent registered public
accounting firm to the audit committee, the audit committee’s independence review, as described below, and the
1The material in this report is not “soliciting material,” is not deemed “filed” with the SEC, and is not to be
incorporated by reference into any filing of LeapFrog under the Securities Act of 1933, amended, or the
1933 Act, or the 1934 Act, whether made before or after the date hereof and irrespective of any general
incorporation language contained in such filing.
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