Â̾ÞÈËÊÓƵ

The following responsibilities supplement the Audit Committee's charge contained in the Â̾ÞÈËÊÓƵ Bylaws.

In fulfilling its responsibilities, the Committee shall take appropriate actions to set an overall tone for quality financial reporting, sound business practices, and ethical behavior.

1.Ìý  Ensure the Integrity of Financial Reporting:

(²¹)ÌýÌý Review and approve the annual financial statements of Â̾ÞÈËÊÓƵ and receive and review the audit reports thereon, including those pertinent to Federal awards received by Â̾ÞÈËÊÓƵ as required by the U.S. Office of Management and Budget.

(²ú)Ìý  Review the judgments of Â̾ÞÈËÊÓƵ management and auditors about the quality and consistency of the Â̾ÞÈËÊÓƵ's application of accounting principles; the reasonableness of significant judgments; and the clarity and completeness of the financial statements and related disclosure.

(³¦)ÌýÌý Confirm with management and the external auditor that the annual financial statements disclose all material off-balance sheet transactions, arrangements, obligations, and relationships of Â̾ÞÈËÊÓƵ with unconsolidated entities or persons that may have a material current or future effect on financial condition, liquidity, or components of revenues or expenses.

(»å)Ìý  Review new and significant accounting pronouncements with the external auditor and understand their impact on the Â̾ÞÈËÊÓƵ financial statements.

(±ð)Ìý  Obtain a report from the external auditor annually regarding required communications under the American Institute of Certified Public Accountants' standards.

2.ÌýÌý Oversee the External Audit Process:

(²¹)ÌýÌý Recommend to the Board the appointment or retention of the external auditor for Â̾ÞÈËÊÓƵ, and be responsible for the compensation and oversight of the external auditor. In accordance with the Board of Trustees' External Audit Policy, the external auditor shall be engaged from among the major national public accounting firms, subject to the Board’s continuing satisfaction with the firm’s services and with re-proposals to be reviewed after each five to seven year period.

(²ú)Ìý  Ensure rotation of the lead audit partner on the audit engagement at least every seven years, independent of the timing of the external audit firm's initial or subsequent engagements.

(³¦)ÌýÌý Pre-approve all audit and non-audit services provided by the external auditors in excess of $30,000 and ensure such services do not include management functions, internal audit services, or other services prohibited by independence standards for the auditing profession, including those standards established by the U.S. Government Accountability Office. External auditor services approved by the Chairperson between Committee meetings shall be reported to the entire Committee at its next scheduled meeting.

(»å)Ìý  Assess the independence of the external auditor on an annual basis by reviewing the written communication from the external auditor required by professional auditing standards and discussing any relationships disclosed that may impact auditor objectivity and independence.

(±ð)Ìý  Resolve disagreements between management and the external auditor regarding financial reporting.

3.   Oversee the Internal Audit Process:

(²¹)ÌýÌý Review and appraise the organizational structure, qualifications, independence, budget, and activities of the Â̾ÞÈËÊÓƵ internal audit department.

(²ú)Ìý  Review and approve the annual internal audit plan and receive interim progress reports on the plan.

(³¦)ÌýÌý Review and concur with the appointment, reassignment, or termination of the Director of Internal Audit.

(»å)Ìý  Periodically review Â̾ÞÈËÊÓƵ's Internal Audit Charter for necessary changes.

(±ð)Ìý  Receive reports of completed internal audits prior to each meeting, and at least annually receive updates on the status of management's actions in response to significant findings from prior reports.

4.ÌýÌý Oversee Risk Management Processes:

(²¹)ÌýÌý Inquire of management, the internal auditor, and the external auditor about significant financial and compliance risks or exposures to Â̾ÞÈËÊÓƵ, and assess the steps management has taken to mitigate such risks or exposures.

(²ú)Ìý  Review and accept the Â̾ÞÈËÊÓƵ Environmental Health and Safety Council's annual report on behalf of the Board.

(³¦)ÌýÌý Review areas of risk assigned to the Audit Committee by the Executive Committee for further review or other follow-up based on annual enterprise risk reports from the System’s chief executive officers.

(»å)Ìý  Monitor adherence to Â̾ÞÈËÊÓƵ conflict of interest policies and related procedures.

5.ÌýÌýÌý°¿³Ù³ó±ð°ù:

(²¹)ÌýÌý Provide for the confidential, anonymous submission by employees and other Â̾ÞÈËÊÓƵ constituents of concerns related to questionable accounting, auditing, or business practices.

(²ú)Ìý  Obtain reports concerning any financial fraud resulting in losses in excess of $10,000 or involving a member of senior management.

(c)   Maintain open lines of communication between the Committee and the Â̾ÞÈËÊÓƵ external auditor, internal auditor, and management.

(d)   Review and assess the adequacy of this Charter on an annual basis and recommend any changes to the Board.