The Audit Committee section of the proxy statement dated December 29, 2000 is
hereby amended to include the report of the audit committee. Such section now
reads as follows:
Audit Committee. The Audit Committee consists of Messrs. Melles and Lear. The
Audit Committee is responsible for reviewing reports of the Company's financial
results, audits, internal controls, and adherence to its Business Conduct
Guidelines in compliance with federal procurement laws and regulations. The
committee recommends to the Board of Directors the selection of the Company's
outside auditors and reviews their procedures for ensuring their independence
with respect to the services performed for the Company.
The Audit Committee is composed of outside directors who are not officers or
employees of Dynasil. In the opinion of the Board, these directors are
independent of management and free of any relationship that would interfere
with their exercise of independent judgment as members of this committee.
In this context, the Committee has met and held discussions with
management and the independent accountants. Management represented to the
Committee that the Company's consolidated financial statements were prepared
in accordance with generally accepted accounting principles, and the Committee
has reviewed and discussed the consolidated financial statements with
management and the independent accountants. The Committee discussed with the
independent accountants matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees).
The Company's independent accountants also provided to the Committee the
written disclosures required by Independence Standards Board Standard No. 1
(Independence Discussions with Audit Committees), and the Committee discussed
with the independent accountants that firm's independence.
Based upon the Committee's discussion with management and the independent
accountants and the Committee's review of the representation of management and
the report of the independent accountants to the Committee, the Committee
recommended that the Board of Directors include the audited consolidated
financial statements in the Company's Annual Report on Form 10-KSB for the year
ended September 30, 2000 filed with the Securities and Exchange Commission.
The Board of Directors has not adopted an audit committee charter, but expects
to do so shortly.
By order of the Board of Directors:
___________________________
Charles J. Searock Jr.
Corporate Secretary
January 16, 2001
West Berlin, New Jersey
