|
|
 |
|
Sarbanes Oxley
Act |
|
SEC. 202.
PREAPPROVAL REQUIREMENTS.
Section 10A
of the Securities Exchange Act of 1934 (15
U.S.C.
78j–1), as
amended by this Act, is amended by adding at
the
end the
following:
‘‘(i) PREAPPROVAL REQUIREMENTS.—
‘‘(1) IN GENERAL.—
‘‘(A) AUDIT COMMITTEE
ACTION.—All auditing services
(which may
entail providing comfort letters in connection
with
securities underwritings or statutory audits
required
for insurance
companies for purposes of State law) and
non-audit
services, other than as provided in
subparagraph
(B), provided
to an issuer by the auditor of the issuer
shall be
preapproved by the audit committee of the
issuer.
‘‘(B) DE MINIMUS
EXCEPTION.—The preapproval
requirement
under
subparagraph (A) is waived with respect to
the provision
of non-audit services for an issuer, if—
‘‘(i) the
aggregate amount of all such non-audit
services
provided to the issuer constitutes not more
than 5
percent of the total amount of revenues paid
by the issuer
to its auditor during the fiscal year
in which the
nonaudit services are provided;
‘‘(ii) such
services were not recognized by the issuer
at the time
of the engagement to be non-audit services;
and
‘‘(iii) such
services are promptly brought to the
attention of
the audit committee of the issuer and
approved
prior to the completion of the audit by the
audit
committee or by 1 or more members of the audit
committee who
are members of the board of directors
to whom
authority to grant such approvals has been
delegated by
the audit committee.
‘‘(2) DISCLOSURE TO
INVESTORS.—Approval by an audit
committee
of an issuer
under this subsection of a non-audit service
to be
performed by the auditor of the issuer shall
be disclosed
to investors
in periodic reports required by section 13(a).
‘‘(3) DELEGATION
AUTHORITY.—The audit committee of
an
issuer may
delegate to 1 or more designated members of
the
audit
committee who are independent directors of the
board
of directors,
the authority to grant preapprovals required
by
this
subsection. The decisions of any member to
whom authority
is delegated
under this paragraph to preapprove an activity
under this
subsection shall be presented to the full
audit committee
at each of
its scheduled meetings.
‘‘(4) APPROVAL OF AUDIT SERVICES FOR OTHER
PURPOSES.—
In carrying
out its duties under subsection (m)(2), if the
audit
committee of
an issuer approves an audit service within the
scope of the
engagement of the auditor, such audit service
shall be
deemed to have been preapproved for purposes
of
this
subsection.’’.
|
|
| | |
