MSB Audit Committtee Charter
Description
MIDSOUTH BANK AUDIT COMMITTEE CHARTER Purpose The audit committee is a committee of the board of directors of MidSouth Bank (the “Bank”). Its primary function is to assist the board by overseeing the financial information that will be provided to the shareholders and others, the systems of internal control over financial reporting, and the internal and external audit processes. The committee shall seek at all times to enhance the independence of the audit function in order to promote objectivity, accuracy and transparency in the Bank’s financial reporting. It shall serve as the primary link between the Bank’s board of directors and its internal and external auditors, overseeing and monitoring the activities of the Bank’s independent internal and external auditors and ensuring the Bank’s audit plan is fulfilled. In carrying out the responsibilities set forth below, the policies and procedures of the committee noted in this charter shall be flexible in order to accommodate changing conditions and other developments. Specifically, this committee shall assist the board of directors in (1) its oversight of the Bank’s accounting and financial reporting principles, policies and procedures, (2) its oversight of the Bank's internal audit controls and procedures, (3) its oversight of the Bank's financial statements and the independent audit of those financial statements, (4) recommending to the board the nomination of the external auditor to be ...
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| Publié par | Nepher |
| Nombre de lectures | 16 |
| Langue | English |
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Last updated:
March 12, 2008
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MIDSOUTH BANK
AUDIT COMMITTEE CHARTER
Purpose
The audit committee is a committee of the board of directors of MidSouth Bank
(the “Bank”).
Its primary function is to assist the board by overseeing the financial
information that will be provided to the shareholders and others, the systems of
internal control over financial reporting, and the internal and external audit
processes.
The committee shall seek at all times to enhance the independence of
the audit function in order to promote objectivity, accuracy and transparency in the
Bank’s financial reporting.
It shall serve as the primary link between the Bank’s
board of directors and its internal and external auditors, overseeing and monitoring
the activities of the Bank’s independent internal and external auditors and ensuring
the Bank’s audit plan is fulfilled.
In carrying out the responsibilities set forth
below, the policies and procedures of the committee noted in this charter shall be
flexible in order to accommodate changing conditions and other developments.
Specifically, this committee shall assist the board of directors in (1) its oversight of
the Bank’s accounting and financial reporting principles, policies and procedures,
(2) its oversight of the Bank's internal audit controls and procedures, (3) its
oversight of the Bank's financial statements and the independent audit of those
financial statements, (4) recommending to the board the nomination of the external
auditor to be proposed for shareholder consideration, evaluating the external
auditor and, when deemed appropriate, recommending the replacement of the
external auditor, (5) evaluating the independence of the external auditor, (6)
remaining current on developments in laws, rules and regulations related to audit
committees, and (7) evaluating and making recommendations with respect to this
Charter.
The function of the committee is oversight.
Management of the Bank is
responsible for preparation, presentation, and integrity of the Bank’s financial
statements.
Management is responsible for maintaining appropriate accounting
and financial reporting principles, policies and internal controls.
The Internal
Auditor is responsible for assuring compliance with accounting standards,
applicable laws and regulations as well as monitoring of internal control systems.
The External Auditor is responsible for planning and carrying out proper audits
and reviews, including reviews of the Bank's quarterly financial statements prior to
the filing of each quarterly report on Form 10-Q, each earnings report on Form 8-
K, and other procedures. It is recognized that, in fulfilling their responsibilities
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hereunder, members of the committee are not full-time employees of the Bank and
are not, and most do not represent themselves to be, acting as accountants or
auditors by profession or experts in the field of accounting or auditing. As such, it
is not the duty or responsibility of the committee or its members to conduct field
work or other types of auditing or accounting reviews or procedures.
Each
member of the committee shall be entitled to rely on (1) the integrity of those
persons and organizations within and outside the Bank from which it receives
information and (2) the accuracy of the financial and other information provided to
the committee by such persons or organizations, absent actual knowledge to the
contrary (which shall be promptly reported to the board).
The external auditor for the Bank is ultimately accountable to the board of
directors (as assisted by the audit committee). The board, with the assistance of the
committee, has the ultimate authority and responsibility to select, evaluate, and
when appropriate, replace the external auditor (or to nominate the external auditor
to be proposed for shareholder consideration); however, it is the intention of the
board of MidSouth Bank that the audit committee shall have absolute authority to
retain, discharge, monitor, and supervise the external and internal auditors subject
only to being overruled by a majority of the members of the entire board of
directors.
The external auditor shall submit to the Bank annually a formal written statement
delineating all relationships between the external auditor and the Bank (Statement
as to Independence), addressing at least the matters set forth in Independence
Standards Board No. 1.
Size of the Audit Committee
The members of the audit committee shall be selected by the board of directors. It
shall consist of at least three members.
These members shall be directors of the
Bank who meet the qualifications of the audit committee’s charter.
Qualifications of Audit Committee Members
Each member of the committee either shall be financially literate, or within a
reasonable time after appointment to the committee, shall become financially
literate. At least one member shall have, or within a reasonable time after
appointment shall obtain, accounting or related financial management expertise.
Each member shall be independent as defined by the National Association of
Securities Dealers, Inc., and free of any relationship that, in the opinion of the
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board of directors, would interfere with his or her exercise of independent
judgment.
At least one member shall have, or as soon as practicable shall achieve,
the status of financial expert within the meaning of Section 407 of the Sarbanes-
Oxley Act of 2002; however, it is the intention of the board of directors that the
members of the audit committee shall be equally responsible for the audit
committee function and that a person deemed, or qualified as, a financial expert
shall not be more responsible, nor shall a person not so deemed or qualified be less
responsible, for the functions and responsibilities of the audit committee.
Election of Audit Committee Members
Members of the committee are elected for a three-year term by the full board of
directors of the Bank on the recommendation of the Bank’s nominating committee.
Such terms may be staggered by the board so that the terms of one-half or one-
third of the members expire each year.
Members shall serve at the pleasure of the
Bank’s board of directors and may be removed by the board of directors at any
time, with or without cause, by the vote of a majority of the entire board of
directors.
Operation of the Committee
From and after January 1, 2004, the committee is expected to meet at least four
times per year or more frequently as circumstances require.
The chair or any
member may request a special meeting, which shall then be scheduled by the
Bank’s Chief Financial Officer.
A quorum shall consist of a majority of the
members, and the vote of a majority of the members present at a meeting at which
a quorum is present shall be the act of the committee. In addition a special meeting
may be called at any time by the committee’s chairperson or the President, Chief
Executive Officer or Chief Financial Officer of the Bank.
Proceedings of the committee over the signature of a member in attendance (or
other person designated by the person chairing the meeting) shall be recorded in a
minute book and reflect the names of those in attendance. The chair of the
committee will present a report of committee activities to the full board of directors
at its next regularly scheduled meeting. The secretary of the board will receive and
permanently maintain the minutes of committee meetings. Meetings may be held
jointly from time to time with any other committee if the majority of both
committees so agree so long as the independence of the assembled committee is
consistent with the independence requirements of the audit committee alone.
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The committee shall have unrestricted access to Bank personnel and documents
and will be given the resources necessary to discharge its responsibilities. The
committee shall have the resources and authority to retain special legal,
accounting, auditing or other experts or consultants to advise the committee. The
Bank shall provide the committee with an appropriate annual budget and shall be
sensitive at all times to requests for funding by the committee. The committee may
request any officer or employee of the Bank or of the Bank's outside counsel or
external auditor to attend a meeting of the committee or to meet with any members
of, or consultants to, the committee. It will be the responsibility of the committee
to maintain free and open means of communication between the directors and
management of the Bank.
The committee shall meet separately at least annually with management, the
internal auditor, and the external auditor in separate executive sessions to discuss
any matters that the committee or any of these persons or firms believes should be
discussed privately. It is intended that the Chair, President, Chief Executive
Officer, and Chief Financial Officer of the Bank will routinely attend meetings of
the committee; provided, that the committee shall have complete power to (1)
request the attendance of other persons, or (2) exclude any person not a member of
the committee from any meeting of the committee. Further, if the committee
determines in good faith that a member of the committee is no longer independent,
then they shall advise such person of such determination, together with a
reasonably detailed (given the circumstances then and there prevailing) written
explanation of the grounds for such determination.
Such person shall then either
resign from the committee or respond in writing to the asserted lack of
independence. The chair of the committee, or an absolute majority of the members
not subject to questioned independence, may (but need not) vote to exclude such
person from the meeting, subject to the right of a majority of the full audit
committee or a majority of the full board of directors of the Bank to reinstate such
person based on its good faith determination that such person is in fact
independent.
Duties and Responsibilities
I.
The committee will provide an open line of communication among the
internal auditor, the external auditor, and the board of directors.
II.
The committee will review and update the committee’s charter annually.
III.
With respect to the external auditor, the committee will:
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3.1
Provide advice to the board in selecting, evaluating, terminating and
replacing the external auditor, as circumstances warrant.
3.2
Review the fees charged by the external auditor for audit and non-
audit services.
3.3
Seek to ensure that the external auditor prepares and delivers annually
a Statement as to Independence (it being understood that the external
auditor is responsible for the accuracy and completeness of this
Statement), discuss with the external auditor any relationships or
services disclosed in this Statement that may have an impact on the
objectivity or independence of the Bank's external auditor and
recommend that the board take appropriate action in response to this
Statement to satisfy itself of the external auditor's independence.
IV.
The committee will advise the external auditor that the external auditor is
ultimately accountable to the board and the committee.
V.
With respect to the internal auditing department or the internal auditing
function, as applicable, the committee will:
5.1
Make recommendations to the board concerning the appointment and
removal of the Bank's internal auditor.
5.2
Advise the internal auditor that he or she is expected to provide the
committee summaries of, and as appropriate significant reports to,
management prepared by the internal auditing department or by the
independent internal auditor (if a non-employee internal auditor is
utilized) and management's responses to them.
VI.
With respect to financial reporting principles and policies and internal audit
controls and procedures, the committee will:
6.1
Advise
management, the internal auditor and the external auditor that
each is expected to provide to the committee a timely analysis of
significant financial reporting issues and practices.
6.2
Consider any reports or communications (and management's and/or
the internal auditor's responses thereto) submitted to the committee by
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the external auditor required by, or referred to in, SAS 61 (as codified
by AU Section 380), as may be modified or supplemented.
6.3
Meet with management, the internal auditor, and/or the external
auditor to discuss the scope of the annual audit, the audited financial
statements and the form of opinion thereon proposed by the external
auditor, any significant matters arising from any audit or report or
communication with respect to significant reports to management
prepared by the internal auditor or required by, or referred to in, SAS
61 relating to the Bank's financial statements, and significant changes
to the Bank's auditing and accounting principles, policies, controls,
procedures and practices proposed or contemplated by the external
auditor, the internal auditor or management, and inquire about
significant risks and exposures, if any, and the steps taken to monitor
and minimize such risks.
6.4
Review such other financial reporting, credit, internal controls, and
comparable matters as the committee shall determine or the board
may request.
VII.
With respect to reporting and recommendations, the committee will:
7.1
Prepare any report, including any recommendation of the committee,
required by the rules of the Securities and Exchange Commission to
be included in the Bank's annual proxy statement.
7.2
Review and reassess the adequacy of this Charter as set forth above
and recommend any changes to the board.
7.3
Publish this Charter at least every three years and as needed to reflect
any changes to the Charter deemed material by the committee or by
the board.
VIII.
The committee will review and approve all consulting (non-audit) services
and related fees to be provided by the external auditor, and consider the
impact of such services on the independence of the auditor.
IX.
The committee will review the appointment, replacement, reassignment, or
dismissal of internal auditor and receive a report from management that is
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consistent with the requirements of Section 404 of the Sarbanes-Oxley Act
of 2002 and any other applicable laws, rules and regulations.
X.
The committee will work with management, the internal auditor, the external
auditor and external consultants to identify significant financial risks and
exposures and assess the steps management has taken to monitor and control
such risks.
XI.
The committee will consider, in consultation with the external auditor and
the internal auditor, the planned external and internal audit scopes and
discuss the coordination of audit effort with the internal auditor and external
auditor in order to create an audit program designed to assure the
completeness of coverage, reduction of redundant work, and the effective
use of audit resources.
XII.
The committee will determine whether to permit the release of
pro forma
earnings.
XIII.
The committee will consider and discuss with the external auditor and/or the
internal auditor:
13.1 The adequacy of the Bank’s internal controls over financial reporting
and over compliance with laws and regulations.
13.2 Any material findings (reportable conditions) and recommendations
about internal control from the external auditor and/or the internal
auditor.
XIV.
At the completion of the annual audit, the committee will discuss with
management and the external auditor (prior to issuance of earnings
announcements and financial statements):
14.1 The Bank’s annual financial statements, including financial items to
be included in the Annual Report on Form 10-K and/or in the Bank’s
Annual Report to its Shareholders.
14.2 The audit of the financial statements and related audit report.
14.3 Material changes in the external audit plan.
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14.4 Any material difficulties, including any restrictions on the scope of
work or access to information, or disputes with management.
14.5 The quality and appropriateness of the Bank’s accounting principles,
as applied in its financial statements.
14.6 Other matters related to the audit that are required by Statements of
Auditing Standards to be communicated to the committee .
XV.
The committee will receive, in writing, a confirmation form the external
auditor that the audit firm is independent within the meaning of the
Securities Act and that it and its activities are in compliance with the
Sarbanes-Oxley Act of 2002 insofar as the Bank and its affiliates are
concerned.
In addition, the committee shall receive such other reports,
certifications, and assurances from the external auditor that it is in
compliance with the Sarbanes-Oxley Act of 2002, including those specified
in “Title II - Auditor Independence” of that Act, as the committee shall deem
appropriate.
Finally, the committee shall obtain from the external auditor
assurance that the audit was conducted in a manner consistent with Section
10A of the Securities Exchange Act of 1934, as amended, which sets forth
certain procedures to be followed in any audit of financial statements
required under that Act.
XVI.
The committee will discuss independence with the external auditor and
recommend that the board of directors take appropriate action regarding any
independence issues.
XVII.
The committee will deliver reports of committee activities/actions to the
board of directors at appropriate meeting(s) of the board.
XVIII.The committee will recommend to the board of directors that the audited
financial statements be filed with the SEC.
XIX.
The committee shall be authorized from time to time to adopt and revise a
complaints and/or a whistle blower policy, subject only to revision by a
majority of the entire committee and/or by a majority of the entire board of
directors.
XX.
The committee will seek to comply with the requirements of the Securities
Exchange Act of 1934, as amended and the Sarbanes-Oxley Act of 2002,
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including all rules and regulations promulgated thereunder.
In particular the
committee shall be mindful of and shall comply with Section 301 of said Act
as it applies to the audit committees of issuers (as defined in that Act).
XXI.
Each member of the committee, and each internal and external auditor, is
hereby required to promptly report in writing to the full board of directors
any improper attempt to influence the conduct of an audit in contravention
of Section 303 of the Sarbanes-Oxley Act of 2002.
XXII.
This Charter is hereby amended to comply with the requirements of the
Sarbanes-Oxley Act of 2002.
Amended and Adopted:
March 12, 2008
____________________________________
Percy E. Dempsey, III, Chairman
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