You are cordially invited to join us for our 2006 annual ... - Piper Jaffray

under ‘‘Management’s Discussion and Analysis of Financial Condition and Results ofOperations,’’ and recommend to the Board whether the annual audited financial statementsshould be included in the Company’s Form 10-K.14. Meet to review and discuss with management and the independent auditor the Company’squarterly financial statements, including reviewing the Company’s specific disclosures under‘‘Management’s Discussion and Analysis of Financial Condition and Results of Operations,’’prior to the filing of the Company’s Form 10-Q.15. Discuss with management and the independent auditor significant financial reporting issuesand judgments made in connection with the preparation of the Company’s financialstatements, including any significant changes in the Company’s selection or application ofaccounting principles.16. Review and discuss with management and the independent auditor any major issues as to theadequacy of the Company’s internal controls, any special steps adopted in light of materialcontrol deficiencies and the adequacy of disclosures about changes in internal control overfinancial reporting.17. Review and discuss with management (including the senior internal audit executive) and theindependent auditor the Company’s internal controls report and the independent auditor’sattestation of the report, prior to the filing of the Company’s Form 10-K.18. Review and discuss with the independent auditor (a) all critical accounting policies andpractices to be used; (b) all alternative treatments of financial information within generallyaccepted accounting principles (‘‘GAAP’’) that have been discussed with management,ramifications of the use of such alternative disclosures and treatments, and the treatmentpreferred by the independent auditor; and (c) other material written communications betweenthe independent auditor and management, such as any management letter or schedule ofunadjusted differences.19. Discuss generally with management the types of information to be disclosed and the types ofpresentations to be made with respect to the Company’s earnings press releases, including theuse of ‘‘pro forma’’ or ‘‘adjusted’’ non-GAAP information, and any financial information andearnings guidance provided to analysts and rating agencies.20. Discuss with management and the independent auditor the effect of regulatory and accountinginitiatives, as well as off-balance sheet structures, on the Company’s financial statements.21. Review disclosures made to the Committee by the Company’s chief executive officer and chieffinancial officer during their certification process for the Form 10-K and Forms 10-Q aboutany significant deficiencies in the design or operation of internal controls or materialweaknesses therein and any fraud involving management or other employees who play asignificant role in the Company’s internal controls.22. Discuss with the independent auditor the matters required to be discussed by Statement onAuditing Standards No. 61 relating to the conduct of the audit, and review with theindependent auditor any difficulties encountered in the course of the audit work, includingany restrictions on the scope of the independent auditor’s activities or on its access torequested information, and any significant disagreements with management, and management’sresponse to such problems or difficulties.Oversee the Company’s Internal Audit Function23. Review the appointment and replacement of the senior internal audit executive.24. Review the significant reports to management prepared by the internal auditor andmanagement’s responses.25. Discuss with the independent auditor and management the responsibilities, budget and staffingof the Company’s internal audit function and the planned scope of the internal audit.A-3