: Director’s Registry information

Advancing a Higher Standard for Audit Committee Qualifications

FEI understands the importance of strong corporate governance and the need for more effective audit committees. Section 407 of the Sarbanes-Oxley Act of 2002 requires the Securities and Exchange Commission (SEC) to adopt rules: (i) requiring each reporting company to disclose whether its audit committee includes at least one member who is a financial expert; and (ii) defining the term "financial expert".

The rules will require a company subject to the reporting requirements of the Securities Exchange Act of 1934 to include disclosure in their Exchange Act filings.

• Pursuant to Section 407, a company will be required to annually disclose whether it has at least one "audit committee financial expert" on its audit committee, and if so, the name of the audit committee financial expert and whether the expert is independent of management. A company that does not have an audit committee financial expert will be required to disclose this fact and explain why it has no such expert.

Audit Committee Financial Experts

The rules define the term "audit committee financial expert" for "financial expert" to mean a person who has the following attributes:

1. an understanding of financial statements and generally accepted accounting principles;
2. an ability to assess the general application of such principles in connection with the accounting for estimates, accruals and reserves;
3. experience preparing, auditing, analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the registrant's financial statements, or experience actively supervising one or more persons engaged in such activities;
4. understanding of internal controls and procedures for financial reporting; and
5. an understanding of audit committee functions.

A person can acquire such attributes through any one or more of the following means:

1. education and experience as a principal financial officer, principal accounting officer, controller, public accountant or auditor or experience in one or more positions that involve the performance of similar functions;
2. experience actively supervising a principal financial officer, principal accounting officer, controller, public accountant, auditor or person performing similar functions, or experience overseeing or assessing the performance of companies or public accountants with respect to the preparation, auditing or evaluation of financial statements; or
3. other relevant experience.

The rules also provide a safe harbor to make clear that an audit committee financial expert will not be deemed an "expert" for any purpose, including for purposes of Section 11 of the Securities Act of 1933, and that the designation of a person as an audit committee financial expert does not impose any duties, obligations or liability on the person that are greater than those imposed on such a person as a member of the audit committee in the absence of such designation, nor does it affect the duties, obligations or liability of any other member of the audit committee or board of directors.

Mission of the FEI Registry

FEI has developed a registry of audit committee board candidates with exceptional qualifications. We believe that this registry will assist corporate boards in coming into compliance with the new requirements. We hope this effort will improve audit committee governance and set a high standard that will have a global impact. In addition, we view this registry as a way of advancing the careers of senior-level financial executives.

How the Registry Works for Search Firms/Corporations

Corporate Boards and search firms looking for board members with the financial expertise to serve on their audit committees will have the ability to search for candidates online. In order to download a candidate's resume or biography, all registrants will be required to complete a registration form. Only retained search firms and qualified corporate board members will be able to gain access to candidates.

How the Registry Works for Financial Executives

As an organization of senior financial executives, many of whom are actively involved with current SEC issues and concerns, FEI has a natural interest in audit committee governance. Many members have responsibilities that require them to be regular participants in their corporate audit committee meetings. More importantly, many FEI members are senior corporate officers that have the finance and accounting experience, the financial sophistication and the financial oversight responsibilities that directorship demands.

If interested and willing to be considered for available board seats, FEI members will complete the online member and upload their resume or biography. Members are encouraged to update their profiles frequently, particularly if they gain board positions or change contact information.

How to Contact Us

Career Services Representative

Financial Executives International

200 Campus Drive

P.O. Box 674

Florham Park, NJ 07932

phone: 973.765.1070

fax: 973.765.1018

careerdistro@financialexecutives.org