This excerpt taken from the HBI DEF 14A filed Mar 12, 2009.
Audit Committee Matters
Audit Committee Report
The information contained in this Audit Committee Report shall not be deemed to be soliciting material or filed or incorporated by reference in future filings with the Securities and Exchange Commission, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934 (the Exchange Act), except to the extent that Hanesbrands specifically incorporates it by reference into a document filed under the Securities Act of 1933 or the Exchange Act.
Each of the members of our Audit Committee, which was established in accordance with Section 3(a)(58) of the Exchange Act, meets the standards of independence applicable to audit committee members under applicable Securities and Exchange Commission rules and New York Stock Exchange listing standards. The Audit Committee assists the Board of Directors in oversight of the integrity of Hanesbrands financial statements, financial reporting process and systems of internal accounting and financial controls, Hanesbrands compliance with legal and regulatory financial disclosure requirements, the independent auditors qualifications and independence, and the performance of Hanesbrands internal audit function and independent auditors. The Audit Committee operates under a written charter, a copy of which is available on our corporate Web site, www.hanesbrands.com, on the Investors page under the link Corporate Governance.
Management is primarily responsible for establishing and maintaining adequate internal financial controls, for preparing the financial statements and for the public reporting process. PricewaterhouseCoopers, the Audit Committee-appointed independent registered public accounting firm for the fiscal year ended January 3, 2009, is responsible for expressing opinions on the conformity of Hanesbrands audited financial statements with accounting principles generally accepted in the United States of America. In addition, PricewaterhouseCoopers expresses its opinion on the effectiveness of Hanesbrands internal control over financial reporting.
In this context, the Audit Committee reviewed and discussed with management and PricewaterhouseCoopers the audited financial statements for the fiscal year ended January 3, 2009, managements assessment of the effectiveness of Hanesbrands internal control over financial reporting and PricewaterhouseCoopers evaluation of Hanesbrands internal control over financial reporting. The Audit Committee met nine times (including telephone meetings) during the fiscal year ended January 3, 2009. The Audit Committee has discussed with PricewaterhouseCoopers the matters that are required to be discussed by Statement on Auditing Standards No. 61 (Communication With Audit Committees), as modified or supplemented. In addition, the Audit Committee has discussed various matters with PricewaterhouseCoopers related to Hanesbrands financial statements, including critical accounting policies and practices used, alternative treatments for material items that have been discussed with management, and other material written communications between PricewaterhouseCoopers and
management. The Audit Committee has also received written disclosures and the letter from PricewaterhouseCoopers required by Public Company Accounting Oversight Board Rule No. 3526 Communications with Audit Committees Concerning Independence and has discussed with PricewaterhouseCoopers its independence from Hanesbrands and its management. In addition, the Audit Committee has received written material addressing PricewaterhouseCoopers internal quality control procedures and other matters, as required by the New York Stock Exchange listing standards. The Audit Committee understands the need for PricewaterhouseCoopers to maintain objectivity and independence in its audit of our financial statements and internal control over financial reporting. The Audit Committee pre-approves all services, including both audit and non-audit services, provided by our independent registered public accounting firm.
Based on the considerations referred to above, the Audit Committee recommended to our Board of Directors that the audited financial statements for the fiscal year January 3, 2009 be included in our Annual Report on Form 10-K for 2008 and selected PricewaterhouseCoopers as our independent registered public accounting firm for the fiscal year ending January 2, 2010.
By the members of the
Audit Committee consisting of:
Ronald L. Nelson (Chair)
Bobby J. Griffin
Jessica T. Mathews
Alice M. Peterson
Auditor Fees and Services
The following table sets forth the fees billed to us by PricewaterhouseCoopers for services in the fiscal years ended January 3, 2009 and December 29, 2007:
In the above table, in accordance with applicable Securities and Exchange Commission rules, Audit fees include fees billed for professional services for the audit of our Consolidated Financial Statements included in our Annual Report on Form 10-K and review of our financial statements included in our Quarterly Reports on Form 10-Q, fees billed for services that are normally provided by the principal accountant in connection with statutory and regulatory filings or engagements, fees related to services rendered in connection with securities offerings and for the fiscal years ended January 3, 2009 and December 29, 2007, the audit of our internal control over financial reporting and consultations concerning financial accounting and reporting standards.
Audit-related fees are fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not reported under the caption Audit fees. For the fiscal years ended January 3, 2009 and December 29, 2007, these fees primarily relate to social security audits and other spin off related consultations.
Tax fees for the fiscal years ended January 3, 2009 and December 29, 2007 include consultation, preparation and compliance services for domestic and certain foreign jurisdictions.
Pre-Approval of Audit Services
Our Audit Committee pre-approves all services, including both audit and non-audit services, provided by our independent registered public accounting firm. For audit services (including statutory audit engagements as
required under local country laws), the independent registered public accounting firm provides the Audit Committee with an engagement letter outlining the scope of the audit services proposed to be performed during the year. The independent registered public accounting firm also submits an audit services fee proposal, which is approved by the Audit Committee before the audit commences. The Audit Committee may delegate the authority to pre-approve audit and non-audit engagements and the related fees and terms with the independent auditors to one or more designated members of the Audit Committee, as long as any decision made pursuant to such delegation is presented to the Audit Committee at its next regularly scheduled meeting. All audit and permissible non-audit services provided by PricewaterhouseCoopers to Hanesbrands since our spin off from Sara Lee were pre-approved by the Audit Committee.