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The Audit Committee (the "Committee") is a committee of the Board of Directors (the "Board") of Bioject Medical Technologies Inc. (the "Company").
The Board of Directors (the "Board") of Bioject Medical Technologies Inc. (the "Company") will appoint from among its members an Audit Committee (the "Committee"); Committee members may be removed by the Board at any time.
The Committee will consist of at least three members of the Board. As defined by applicable law and regulation, each Committee member shall be determined by the Board to be independent and generally knowledgeable in financial and auditing matters, and at least one member shall have accounting or related financial management expertise.
The Board will designate one Committee member to serve as Chairman of the Committee.
The primary purpose of the Committee is to assist the Board in fulfilling its responsibilities for oversight of the reliability, quality and integrity of the Company's accounting and financial reporting processes and the audits of the Company's financial statements and internal controls.
DUTIES AND RESPONSIBILITIES
The Committee will:
- Appoint, retain, compensate, evaluate and, as it deems necessary or advisable, terminate the independent auditor;
- Approve all audit engagement fees and terms;
- Pre-approve and adopt policies governing pre-approval of all audit and permissible non-audit services to be provided by the independent auditor;
- Establish procedures for the receipt, retention and treatment of complaints about accounting, internal accounting controls or auditing matters, as well as for confidential, anonymous submissions by Company employees of concerns regarding questionable accounting or auditing matters;
- Oversee the performance of the Company's internal audit function and the independent auditor;
- Review and discuss with the independent auditor its statement delineating all relationships between it and the Company, and assess the independence of the independent auditor;
- Discuss with the independent auditor all critical accounting policies, alternative treatments of financial information within generally accepted accounting principles discussed with management, the ramifications of the use of alternative treatments and the independent auditor's preferred treatment, and any other material written communications between the independent auditor and management;
- Review and discuss with management and the independent auditor the Company's annual and quarterly financial statements;
- Review the Company's earnings press releases;
- Resolve disagreements between management and the independent auditor;
- Review any required management reports on internal controls and any related certifications by the independent auditor;
- Discuss with the independent auditor all matters required to be discussed under generally accepted auditing standards, including the scope and results of their audit of the Company's consolidated financial statements;
- Review disclosures made by the Chief Executive Officer and Chief Financial Officer regarding the design or operation of internal controls and any fraud that involves management or other employees who have a significant role in the Company's internal controls;
- Discuss with management the development and selection of any critical accounting estimates, and the Company's related disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations;"
- Prepare the report that is required to be included in the Company's annual proxy statement;
- Perform any other activities consistent with this Charter, the Company's By-laws and governing law, as the Committee or the Board deems necessary or appropriate; and
- Annually review and assess the adequacy of this Charter and recommend to the Board any proposed changes to this Charter.
The Committee has the authority to:
- Appoint, retain, compensate, evaluate and terminate the independent auditor and to approve all audit engagement fees and terms;
- Engage, compensate and terminate independent counsel and other advisors;
- Conduct or authorize investigations into any matters within the scope of its responsibility;
- Meet with and seek any information from any Company officer, employee, outside counsel, or the independent auditor, or others, all of whom are directed to cooperate with the Committee; and
- Form and delegate authority to subcommittees as appropriate and permitted by applicable law or regulation.
MEETINGS AND OPERATIONS
The Committee shall meet at least four times annually or more frequently, or as advisable, as it deems necessary to fulfill its responsibilities. The Committee will cause to be kept adequate minutes of all of its proceedings, and will report its actions to the next meeting of the Board. Committee members will be furnished with copies of the minutes of each meeting and any action taken by unanimous consent. The Committee is governed by the same rules regarding meetings (including meetings by conference telephone or similar communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as are applicable to the Board. The Committee is authorized to adopt its own rules of procedure not inconsistent with any provision of this Charter, any provision of the Bylaws of the Company, or the laws of the state of Oregon.
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