WHR » Topics » WHIRLPOOL CORPORATION BOARD OF DIRECTORS AUDIT COMMITTEE CHARTER

This excerpt taken from the WHR DEF 14A filed Mar 24, 2006.

WHIRLPOOL CORPORATION
BOARD OF DIRECTORS
AUDIT COMMITTEE CHARTER

Approved 4/19/05

I.
PURPOSE    To fulfill responsibilities to the Company's shareholders, potential shareholders, and the investment community, the Audit Committee will provide independent and objective oversight of the Company's accounting functions and internal controls and will monitor the objectivity of the Company's financial statements. The Committee will assist Board oversight of (1) the integrity of the Company's financial statements, (2) the Company's compliance with legal and regulatory requirements, (3) the independent registered public accounting firm's qualifications and independence, and (4) the performance of the Company's internal audit function and independent registered public accounting firm. In addition, the Committee will prepare all the Committee reports required under the law and will provide an open avenue of communication between the financial management, internal auditor, independent registered public accounting firm, and the Board of Directors.

II.
COMMITTEE MEMBERS    The Committee shall be composed of at least three Directors appointed by the Board of Directors. Committee members shall not be officers or employees of the Company or one of its subsidiaries and shall, in the opinion of the Board, meet the independence and financial experience and financial literacy and expertise requirements of the New York Stock Exchange and/or relevant law. Under these requirements, each member of the Committee shall be free from any relationship that would interfere with the exercise of independent judgment as a Committee member. All members of the Committee shall have an understanding of basic finance and accounting practices, and at least one member of the Committee shall have accounting or related financial management experience. Committee members shall not simultaneously serve on the audit committees of more than three public companies (including the Company).

III.
COMMITTEE MEETINGS    The Committee shall meet at least four times a year, or more frequently as appropriate. The Committee shall meet with management, internal audit, and the independent registered public accounting firm in separate executive sessions to discuss matters privately. All meetings shall be conducted pursuant to the applicable provisions of the Company's by-laws. Meeting agendas will be prepared and provided in advance to Committee members, along with appropriate briefing materials. Minutes of meetings will be prepared and the Committee will report to the Board the results of its meetings. The Committee may form one or more sub-committees, each of which may take such actions as may be delegated by the Committee.

IV.
DUTIES and RESPONSIBILITIES    While the Committee has the responsibilities and powers set forth in the Company's by-laws and this charter, the Committee does not have the duty to plan or conduct audits or to determine that the Company's financial statements are complete and accurate and are in accordance with generally accepted accounting principles. This is the responsibility of management and the independent registered public accounting firm. However, the Committee does have the following duties and responsibilities in addition to any similar matter that may be referred to the Committee from time to time by the full Board, the Chairman, or which the Committee raises on its own initiative:

1.
Review and approve in advance the annual audit and its scope for the Company and its wholly-owned or majority-owned subsidiaries; monitor the annual audit and its scope for affiliates; and

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      review the annual audit results with respect to (a) the Company's financial statements, including appropriately addressing risks related to litigation, foreign exchange, taxes, contingent liabilities, and similar matters, and (b) the Company's internal controls, including electronic data processing controls, and the extent to which such controls are evaluated by the independent registered public accounting firm for adequacy and protection.

    2.
    Review and discuss the annual audited financial statements and quarterly financial statements and related reports with management and the independent registered public accounting firm, including the Company's disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations," to monitor adequacy of disclosure. The Committee shall discuss earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies with management and the independent registered public accounting firm prior to the release of earnings as appropriate. The Committee's discussion of earnings releases as well as financial information and earnings guidance may be general (i.e., discussion of the types of information to be disclosed and the type of presentations to be made). The Committee need not discuss in advance each earnings release or each instance in which the Company may provide earnings guidance.

    3.
    Review and discuss annually with management its assessment of the effectiveness of the Company's internal control structure and procedures for financial reporting. Review annually with the independent registered public accounting firm the attestation to, and report on, the assessment of the effectiveness of internal controls made by management. Consider whether any changes to the internal controls or disclosure control processes or procedures are appropriate in light of management's assessment or the independent registered public accounting firm's report.

    4.
    Review the independent registered public accounting firm's management letter and recommendations (or any audit problems, difficulties, or disagreements) and management's response.

    5.
    Retain and terminate the Company's independent registered public accounting firm and exercise the Committee's sole authority to review and approve all audit engagement fees and terms and approve in advance the nature, extent, and cost of all non-audit services provided by the independent registered public accounting firm in accordance with relevant NYSE listing rules and law.

    6.
    Obtain and review a report by the independent registered public accounting firm describing the firm's internal quality control procedures and all material issues raised by the most recent internal quality control review, or peer review of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and all steps to deal with such issues.

    7.
    Review, evaluate, and discuss with the independent registered public accounting firm all relationships between the firm and the Company to assess the firm's independence. Review and evaluate the lead partner of the independent registered public accounting firm, assure regular rotation of the lead partner as required by law, and consider whether there should be regular rotation of the audit firm itself. Present its conclusions with respect to the independent registered public accounting firm to the full Board.

    8.
    Review major accounting policy changes adopted by the Company. Maintain current knowledge on major new or proposed technical requirements, regulations, or legislation affecting the Company.

    9.
    Review codes of conduct and management reports on employee compliance, including compliance with the Foreign Corrupt Practices Act, to guard against significant conflicts of

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      interest and dishonest, unethical, or illegal activities. Monitor Company activities that are designed to assure compliance with such codes and review management findings involving significant lapses of ethical conduct, fraud, or criminal conduct.

    10.
    Review with management situations where new activities, major changes in operations, or other developments may create significant financial exposure for the Company. Review policies and guidelines with respect to risk assessment and risk management, including management reports on the Company's processes to manage and report risks related to litigation, foreign exchange, taxes, contingent liabilities, and similar matters that may constitute significant financial risk exposures.

    11.
    Review activities of the Company's internal audit function, audit plans, procedures and results, and coordination with the independent registered public accounting firm. Regularly review the continued overall effectiveness of the internal audit function as required under relevant NYSE listing rules and law.

    12.
    Annually review the Committee's charter and operations and recommend any proposed changes to the Board for its approval. Prepare any reports required under relevant NYSE listing rules and law.

    13.
    Set an appropriate hiring policy for employees or former employees of the independent registered public accounting firm with due regard for the continuing independence of the firm.

    14.
    Establish and maintain procedures for (a) the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal controls, and auditing matters, and (b) the confidential and anonymous submission by employees of the Company of concerns with questionable accounting or auditing matters in accordance with relevant NYSE listing rules and law.

    15.
    Annually prepare and cause to be filed in the Company's annual proxy statement a report to stockholders as may be required by the Securities and Exchange Commission.

    16.
    The Committee may conduct or authorize investigations into any matters within the Committee's scope of responsibilities and, in connection therewith, may retain independent counsel, accountants, or others to assist it.

    17.
    Make regular reports to the Board and evaluate annually its performance in accordance with relevant NYSE listing rules and law.

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