ANTENNA PRODUCTS, INC.
Audit Committee Charter
June 13, 2000
The audit committee of the Board of Directors ("the Board") of Antenna Products,
Inc. (AP) will have the oversight responsibility, authority and specific duties
as described below. The charter is to be published as an appendix to the proxy
statement every three years.
COMPOSITION
The audit committee will be comprised of three or more directors as determined
by the Board. The members of the audit committee will meet the requirements of
the Nasdaq independent director and audit committee requirements. The members of
the audit committee will be elected annually at the organizational meeting of
the full Board held in October and will be listed in the annual report to
shareholders. One of the members of the audit committee will be elected
committee chair by the Board.
RESPONSIBILITY
The audit committee is a part of the Board. It's primary function is to assist
the Board in fulfilling its oversight responsibilities with respect to (i) the
annual financial information to be provided to shareholders and the Securities
and Exchange Commission (SEC); (ii) the system of internal controls that
management has established; and (iii) the external audit process. In addition,
the audit committee provides an avenue for communication between the independent
accountants, financial management and the Board. The audit committee should have
a clear understanding with the independent accountants that they must maintain
an open and transparent relationship with the audit committee, and that the
ultimate accountability of the independent accountants is to the Board and the
audit committee. The audit committee will make regular reports to the Board
concerning its activities. While the audit committee has the responsibilities
and powers set forth in this charter, it is not the duty of the audit committee
to plan or conduct audits or to determine that AP's financial statements are
complete and accurate and are in accordance with generally accepted accounting
principles. This is the responsibility of management and the independent
auditor. Nor is it the duty of the audit committee to conduct investigations, to
resolve disagreements, if any, between management and the independent auditor or
to assure compliance with laws and regulations and AP's business conduct
guidelines.
AUTHORITY
Subject to the prior approval of the Board, the audit committee is granted the
authority to investigate any matter or activity involving financial accounting
and financial reporting, as well as the internal controls of the Company. In
that regard, the audit committee will have the authority to approve the
retention of external professionals to render advice and counsel in such
matters. All employees will be directed to cooperate with respect thereto as
requested by members of the audit committee.
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Audit Committee Charter
June 13, 2000
MEETINGS
The audit committee is to meet at least once each year and as many additional
times as the audit committee deems necessary. Content of the agenda for each
meeting should be cleared by the audit committee chair. The audit committee is
to meet in separate executive sessions with the chief financial officer and the
independent accountants at least once each year and at other times when
considered appropriate.
ATTENDANCE
Audit committee members will strive to be present at all meetings. As necessary
or desirable, the audit committee chair may request that members of management
and representatives of the independent accountants be present at audit committee
meetings.
SPECIFIC DUTIES
In carrying out its oversight responsibilities, the audit committee will:
1. Review and reassess the adequacy of this charter annually and recommend
any proposed changes to the Board for approval. This should be done in
compliance with all applicable NASDAQ Audit Committee Requirements.
2. Review with AP's management and independent accountants the Company's
accounting and financial reporting controls. Obtain annually in writing
from the independent accountants their letter as to the adequacy of
such controls.
3. Review with AP's management and independent accountant's significant
accounting and reporting principles, practices and procedures applied
by AP in preparing its financial statements. Discuss with the
independent accountants their judgements about the quality, not just
the acceptability, of AP's accounting principles used in financial
reporting.
4. Review the scope and general extent of the independent accountants'
annual audit. The audit committee's review should include an
explanation from the independent accountants of the factors considered
by the accountants in determining the audit scope, including the major
risk factors. The independent accountants should confirm to the audit
committee that no limitations have been placed on the scope or nature
of their audit procedures. The audit committee will review annually
with management the fee arrangement with the independent accountants.
5. Inquire as to the independence of the independent accountants and
obtain from the independent accountants, at least annually, a formal
written statement delineating all relationships between the independent
accountants and AP as contemplated by Independence Standards Board
Standard No. 1, Independence Discussions with Audit Committees.
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Audit Committee Charter
June 13, 2000
6. Have a predetermined arrangement with the independent accountants that
they will advise the audit committee through its chair and management
of the Company of any matters identified through procedures followed
for interim quarterly financial statements, and that such notification
as required under standards for communication with audit committees is
to be made prior to the related press release and prior to filing Forms
10-Q.
7. At the completion of the annual audit, review with management and the
independent accountants the following:
- The annual financial statements and related footnotes and financial
information to be included in AP's annual report to shareholders and
on form 10-K.
- Results of the audit of the financial statements and the related
report thereon and, if applicable, a report on changes during the
year in accounting principles and their application
- Significant changes to the audit plan, if any, and any serious
disputes or difficulties with management encountered during the
audit. Inquire about the cooperation received by the independent
accountants during their audit, including access to all requested
records, data and information. Inquire of the independent accountants
whether there have been any disagreements with management, which, if
not satisfactorily resolved, would have caused them to issue a
nonstandard report on AP's financial statements.
- Other communications as required to be communicated by the
independent accountants by Statement of Auditing Standards (SAS) 61
as amended by SAS 90 relating to the conduct of the audit. Further,
receive a written communication provided by the independent
accountants concerning their judgment about the quality of AP's
accounting principles, as outlined in SAS 61 as amended by SAS 90,
and that they concur with management's representation concerning
audit adjustments.
8. Discuss with the independent accountants the quality of AP's financial
and accounting personnel. Also, elicit the comments of management
regarding the responsiveness of the independent accountants to AP's
needs.
9. Meet with management and the independent accountants to discuss any
relevant significant recommendations that the independent accountants
may have, particularly those characterized as `material' or `serious'.
Typically, such recommendations will be presented by the independent
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accountants in the form of a Letter of Comments and Recommendations to
the audit committee. The audit committee should review responses of
management to the Letter of Comments and Recommendations from the
independent accounts and receive follow-up reports on action taken
concerning the aforementioned recommendations.
10. Recommend to the Board the selection, retention or termination of AP's
independent accountants.
11. Review with management and the independent accountants the methods used
to establish and monitor AP's policies with respect to unethical or
illegal activities by AP employees that may have a material impact on
the financial statements.
12. Generally as part of the review of the annual financial statements,
receive an oral report(s), at least annually, from AP's general counsel
concerning legal and regulatory matters that may have a material impact
on the financial statements.
13. As the audit committee may deem appropriate, obtain, weigh and consider
expert advice as to the audit committee related rules of Nasdaq,
Statements on Auditing Standards and other accounting, legal and
regulatory provisions.