Risk is inherent with every business, and how well a business manages risk can ultimately
determine its success. We face a number of risks more fully described in our annual and quarterly
filings with the SEC, including risks relating to dependence on clients and suppliers, competition,
product development, credit and liquidity, and other business risks. Management is responsible for
the day-to-day management of risks we face, while our Board of Directors, as a whole and through
its committees, has responsibility for the oversight of risk management. In its risk oversight
role, our Board of Directors has the responsibility to satisfy itself that the risk management
processes designed and implemented by management are adequate and functioning as designed. The
Board of Directors, together with its committees, provides company-wide oversight of our management
and handling of risk. At meetings of the Board of Directors and its committees, directors receive
regular updates from management regarding risk management. Outside of formal meetings, the Board,
its committees and individual Board members have regular access to the executive officers of the
Company and are often consulted by management in respect of Company operations.
Report of the Audit Committee for the Fiscal Year Ended December 31, 2009
The following is the report of the Audit Committee with respect to the Companys audited
financial statements for the fiscal year ended December 31, 2009. The information contained in this
report shall not be deemed to be soliciting material or to be filed with the Securities and
Exchange Commission, nor shall such information be incorporated by reference into any future filing
under the Securities Act of 1933, as amended, or the 1934 Securities Exchange Act, as amended,
except to the extent that the Company specifically incorporates such information by reference in
The Audit Committee of the Companys Board of Directors is comprised of three independent
directors. The current members of the Audit Committee are Messrs. Reilly, Beatson and Jacobs.
Management is responsible for the Companys internal controls and the financial reporting
process. The independent accountants (auditors) are responsible for performing an independent
audit of the Companys consolidated financial statements in accordance with generally accepted
auditing standards and issuing a report thereon. The Audit Committees responsibility is to monitor
these processes. The Audit Committee does not itself prepare financial statements or perform
audits, and its members are not auditors or certifiers of the Companys financial statements.
The Audit Committee approved the appointment of the Companys auditors, Grant Thornton LLP for
the fiscal year ended December 31, 2009.
In fulfilling its oversight responsibility of appointing and reviewing the services
performed by the Companys independent auditors, the Audit Committee carefully reviews the policies
and procedures for the engagement of the independent auditor, including the scope of the audit,
audit fees, auditor independence matters and the extent to which the independent auditor may be
retained to perform non-audit related services. The Audit Committee considered the independent
auditors provision of non-audit services in 2009 and determined that the provision of those
services is compatible with and does not impair the auditors independence.
The Audit Committee discussed with the Companys auditors the scope and plans for the
independent audit. Management represented to the Audit Committee that the Companys consolidated
financial statements were prepared in accordance with generally accepted accounting principles. The
Audit Committee has reviewed and discussed with management and the auditors the Companys audited
financial statements, including the auditors judgments about the quality, not just the
acceptability, of the accounting principles, the reasonableness of significant judgments and the
clarity of disclosures in the financial statements. The Audit Committee also discussed with the
auditors the matters required by Statement on Auditing Standards No. 61, as amended.
The Audit Committee has received the written disclosures and the letter from the Companys
independent accountants required by Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committees, and the Audit Committee discussed with the auditors their
independence from the Company and its management.