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Mandate
The Audit Committee provides assistance to the Board of
Directors in fulfilling its oversight responsibility to the shareholders with
respect to the Corporation’s:
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financial statements;
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financial reporting process;
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systems of internal and disclosure controls;
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internal audit function;
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external audit function;
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financial arrangements and liquidity; and
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risk identification, assessment and management program.
It is the responsibility of the Committee to maintain an open avenue of
communication between itself, the external auditors, the internal auditors and
management of the Corporation. In performing its role, the Committee is
empowered to investigate any matter brought to its attention, with full access
to all books, records, facilities and personnel of the Corporation. It is also
empowered to retain outside counsel or other experts as required.
Committee Membership
| Name |
Independent |
| J.M. Reid, Chair |
Yes |
| R. Bacarreza |
Yes |
| J.E.C. Carter |
Yes |
| D.L. Emerson |
Yes |
| K.M. O’Neill, Financial Expert |
Yes |
| A.H. Simon |
Yes |
Douglas W.G. Whitehead attends meetings of the Audit Committee in his capacity
as Chairman of the Board. All Committee members shall be independent and
financially literate (as such terms are defined in National Instrument 52-110 –
Audit Committees) and at least one member is required to have accounting or
related financial management expertise. K.M. O’Neill is the current designated
“financial expert” member of the Audit Committee.
Meetings
The Committee met four times in 2009 and achieved 100% attendance at all
meetings. All of these meetings were held in person. At every Committee meeting
the members met in camera without management.
External Auditor
Deloitte & Touche LLP (“Deloitte”) has been the Corporation’s external
auditors since 2002. The Audit Committee has the oversight responsibility for
reviewing Deloitte’s performance, qualifications, independence and audit of the
Corporation’s financial statements.
Services provided by the external auditor are:
Audit Services
Audit Related Services
Audit related services include assurance and related services, such as audits
of the Corporation’s pension plans that are reasonably related to the
performance of the annual audit, review of the Corporation’s quarterly
financial statements and assistance with the Corporation’s IFRS transition.
Tax Services
Tax services include tax compliance reviews, review of the tax impact of
specific transactions, assistance with inquiries from tax authorities, and
international employee relocation advice and personal tax assistance.
Other Services
Other services would include any non audit-related or non tax services. There
were no other services provided in 2009 or 2008.
External Auditor Fees
Fees paid or accrued by the Corporation and its major business units or
subsidiaries for audit and other services provided by Deloitte during 2009 and
2008 were as follows:
| Type of Service Provided |
2009(1) |
2008(1) |
| Audit Services |
$2,163,124 |
$2,325,075 |
| Audit-Related Services |
$93,469 |
$209,114 |
| Tax Services |
$18,552 |
$70,624 |
| Other Services |
Nil |
Nil |
Total: |
$2,275,145 |
$2,604,843 |
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(1) Amounts were billed in various currencies and converted to Canadian dollars
using the exchange rates in existence at the time of billing.
Pre-approval Policies and Procedures
The Audit Committee has adopted a formal policy requiring the pre-approval of
services to be provided by Deloitte, prior to the commencement of the
engagement. Between regularly scheduled Audit Committee meetings, the Committee
has delegated to the Chair of the Audit Committee the authority to approve
individual service engagements that have not been pre-approved. Under no
circumstances will the Corporation’s management engage the external auditors to
perform services that have not been approved by the Audit Committee. Management
and the external auditor are required to report quarterly to the Audit
Committee all services provided by the external auditor and fees paid or
accrued for the fiscal year-to-date period.
The Committee determined that the provision of the audit-related and tax
services described above did not compromise the independence of Deloitte for
purposes of performing audit services for the Corporation. In addition,
Deloitte is required to comply with the terms of the Corporation’s “Terms of
Reference for External Auditors”.
Risk Management
The Corporation has adopted a risk management approach to identifying and
evaluating risks in order to protect and enhance shareholder value. On a
quarterly basis, the Audit Committee reviews the Corporation’s process with
respect to risk assessment and management of key risks, including the
Corporation’s major financial risks and exposures and the steps taken to
monitor and control such exposures. The risk management process involves the
identification, by each of the Corporation’s significant operations, of key
risks that could impact the achievement of the Corporation’s strategic plan.
Each of these key risks is monitored closely and disclosed annually in the
Corporation’s Annual Information Form. Any changes to the key risks are
reviewed by the Audit Committee and are disclosed on a quarterly basis in the
Corporation’s interim financial filings.
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