Tucows 2012 Annual Report Download - page 74

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPEDENCE
Review, Approval or Ratification of Transactions with Related Persons
The Audit Committee of the Board of Directors is responsible for reviewing and, if appropriate, approving all
related party transactions between us and any officer or director that would potentially require disclosure pursuant to the
Audit Committee charter. As of the date of this Annual Report on Form 10-K, we expect that any transactions in which
related persons have a direct or indirect interest will be presented to the Audit Committee for review and approval.
While neither the Audit Committee nor the board have adopted a written policy regarding related party transactions, the
Audit Committee makes inquiries to our management and our auditors when reviewing such transactions. Neither we nor
the audit committee are aware of any transaction that was required to be reported with the SEC where such policies and
procedures either did not require review or were not followed.
Director Independence
Our Board of Directors has determined that each of Messrs. Stern, Fiume, Gissin, Ito, Karp, Ralls, Schwarz and
Dr. Morrisett are independent directors as defined in Section 121A of the NYSE Amex listing standards. In this Annual
Report on Form 10-K, each of these eight directors are referred to individually as an “independent director” and
collectively as the “independent directors.”
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
A summary of the fees of KPMG LLP for the years ended December 31, 2012 and 2011 are set forth below:
2012 Fees 2011 Fees
Audit Fees(1) $ 265,500 $ 228,700
Audit-Related Fees
—
25,300
Tax Fees(2) 127,000 109,000
All Other Fees
—
—
Total Fees $ 392,500 $ 363,000
(1) Consists of fees and expenses for the audit of consolidated financial statements, the reviews of ou
r
Quarterly Reports on Form 10-Q and services associated with registration statements.
(2) Consists of fees and expenses for tax consulting services.
Audit Committee pre-approval of audit and permissible non-audit services of independent auditors.
The Audit Committee has adopted a pre-approval policy that provides guidelines for the audit, audit-related, tax
and other non-audit services that may be provided to us by our independent auditors. Under this policy, the audit
committee pre-approves all audit and certain permissible accounting and non-audit services performed by the
independent auditors. These permissible services are set forth on an attachment to the policy that is updated at least
annually and may include audit services, audit-related services, tax services and other services. For audit services, the
independent auditor provides the audit committee with an audit plan including proposed fees in advance of the annual
audit. The Audit Committee approves the plan and fees for the audit.
With respect to non-audit and accounting services of our independent auditors that are not pre-approved under
the policy, the employee making the request must submit the request to our chief financial officer. The request must
include a description of the services, the estimated fee, a statement that the services are not prohibited services under the
policy and the reason why the employee is requesting our independent auditors to perform the services. If the aggregate
fees for such services are estimated to be less than or equal to $25,000, our chief financial officer will submit the request
to the chairman of the audit committee for consideration and approval, and the engagement may commence upon the
approval of the chairman. The chairman is required to inform the full audit committee of the services at its next meeting.
If the aggregate fees for such services are estimated to be greater than $25,000, our chief financial officer will submit the
request to the full audit committee for consideration and approval, generally at its next meeting or special meeting called
for the purpose of approving such services. The engagement may only commence upon the approval of full audit
committee.