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EXHIBIT 99
AUDIT COMMITTEE CHARTER
Computerized Thermal Imaging, Inc.
Charter
of the
Audit Committee
of the
Board of Directors
PURPOSE. The Audit Committee of the Board of Directors shall conduct continuing
oversight of the financial affairs of Computerized Thermal Imaging, Inc.
SCOPE OF REVIEW. The Audit Committee shall conduct an ongoing review the
Corporation's:
- Financial reports and other financial information prior to their being
filed with the U.S. Securities and Exchange Commission or otherwise
provided to the public.
- Systems, methods and procedures of internal controls in the areas of:
financial reporting, audits, treasury operations, corporate finance,
managerial, financial and SEC accounting, compliance with law, and ethical
conduct.
GENERAL TASKS. The Audit Committee shall:
- Be independent and objective.
- Recommend and encourage improvements in the Corporation's financial
affairs.
- Review and assess the work of the Corporation's independent accountant and
internal audit department.
- Solicit and encourage comments from the Corporation's independent
accountant, financial and senior management, internal audit department and
the Board of Directors.
AUDIT COMMITTEE MEMBERS. The Audit Committee shall consist of three or more
Members (the "Members") who are independent Directors. The Board of Directors
shall elect the Members annually. Members shall serve until their successors are
duly elected and qualified. Unless an Audit Committee Chairperson is elected by
the full Board, the Members of the Committee may designate a Chairperson by
majority vote of the all Members.
Each member shall be free from any relationship that could conflict with a
member's independent judgment. All Members must be able to read and understand
fundamental financial statements, including a balance sheet, income statement,
and cash flow statement. At least one member must have
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past employment experience in finance or accounting, requisite professional
certification in accounting, or other comparable experience or background,
including a current or past position as a chief executive or financial officer
or other senior officer with financial oversight responsibilities.
INDEPENDENCE. Independent Director is defined as a director who has:
- Not been employed by the Corporation or its affiliates in the current or
past three years.
- Not accepted any compensation from the Corporation or its affiliates in
excess of $60,000 during the previous fiscal year (except for board
service, retirement plan benefits, or non-discretionary compensation).
- No immediate family member who is, or has been in the past three years,
employed by the Corporation or its affiliates as an executive officer.
- Not been a partner, controlling shareholder or an executive officer of any
other for- profit entity to which the Corporation made, or from which it
received, payments (other than those which arise solely from investments in
the Corporation's securities) that exceed five percent of the other
entity's consolidated gross revenues for that year, or $200,000, whichever
is more, in any of the past three years.
- Not been employed as an executive of another entity where the Corporation's
executives serve on the other entity's compensation committee.
MEETINGS. The Audit Committee shall meet at least four times per year, and may
meet as frequently as deemed necessary. The Audit Committee shall meet
separately in closed meetings at least once each year with management, the
director of internal audit and the independent accountant to discuss any matter.
The Audit Committee shall select one of its Members each quarter to meet with
management, the director of internal audit and the independent accountant for
the purposes set forth below.
SPECIFIC TASKS. The Audit Committee shall:
- Assess and, if necessary, update this Charter at least annually.
- Review the Corporation's annual, quarterly and other financial statements
and any other reports, financial information or other material filed with
any governmental body (except for litigation matters in the ordinary course
of business) or announced to the public, including the independents
accountant's certifications, reports, opinions, or reviews.
- Review the regular internal reports to management prepared by the internal
audit department and management's response thereto.
- Review with management and the independent accountant all Form 10-Q `s
prior to the filing or prior to the release of earnings information to the
public. The Chairperson of the Audit Committee may represent the entire
Audit Committee for the review of the Form 10-Q.
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- Recommend to the Board of Directors the selection of the independent
accountant for each fiscal year, considering independence and
effectiveness, and approve the fees and other compensation to be paid to
the independent accountant. On an annual basis, the Audit Committee shall
review and discuss with the independent accountant all significant
relationships the independent accountant has with the Corporation to
determine the accountant's independence.
- Review the performance of the independent accountant and approve any
proposed discharge of the independent accountant when circumstances
warrant.
- Periodically consult with the independent accountant, out of the presence
of management, about internal controls and the completeness and accuracy of
the Corporation's financial statements.
- Continually review the integrity of the Corporation's internal and external
financial reporting processes. The Audit Committee shall consult with the
independent accountant and the internal auditors for this review.
- Consider the independent accountant's judgments about the quality and
appropriateness of the Corporation's accounting principles in relation to
the Corporation's internal and external financial reporting.
- Consider and approve, if appropriate, major changes to the Corporation's
auditing and accounting principles and practices.
- Establish regular and separate systems of reporting to the Audit Committee
by each of management, the independent accountant and the internal auditors
in connection with the appropriateness and application of accounting
principles made in management's preparation of the financial statements.
- Following completion of the annual audit, review separately with each of
management, the independent accountant and the internal audit department
whether any difficulties were encountered during the course of the audit,
including any restrictions on the scope of work or access to required
information.
- Review any disagreement among management and the independent accountants or
the internal auditing department in connection with the preparation of the
financial statements or the appropriateness and application of accounting
principles made in management's preparation of the financial statements.
- Review with the independent accountant, the internal audit department and
management whether and how changes or improvements in the Corporation's
financial or accounting practices, as approved by the Audit Committee, have
been implemented. The Audit Committee shall conduct this review promptly
after the implementation of the changes or improvements.
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- Establish a code of corporate compliance with law and a code of ethical
conduct, and review the Corporation's implementation and enforcement of
these codes.
- Review activities, organizational structure, and qualifications of the
internal audit department.
- Review, with the Corporation's counsel, legal compliance matters including
policies regarding trading in the Corporation's securities.
- Review, with the Corporation's counsel, any legal matter that could have a
material impact on the Corporation's financial statements.
- Perform any other activities consistent with this Charter, the
Corporation's Articles of Incorporation, By-laws and governing law, as the
Audit Committee or the Board of Directors deems necessary or appropriate.
