Pier 1 2008 Annual Report Download - page 105

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firm’s report on Pier 1 Imports’ internal control over financial reporting, as required under Section 404 of
the Sarbanes-Oxley Act of 2002.
(2) Includes fees for services related to tax compliance, tax advice and tax planning.
(3) Includes fees for subscription to online research tool.
Pre-approval of Nonaudit Fees
The audit committee has adopted a policy that requires advance approval of all audit, audit-related, tax
and other services performed by the independent registered public accounting firm. The policy provides for
pre-approval by the audit committee of specifically defined audit, audit related and tax services. Unless the
specific service has been previously pre-approved with respect to a fiscal year, the audit committee must
approve the permitted service before the independent registered public accounting firm is engaged to perform
it. The audit committee has delegated to the chairman of the audit committee authority to approve permitted
services up to $50,000 per engagement provided that the chairman reports any pre-approval decisions to the
committee at its next scheduled meeting.
AUDIT COMMITTEE REPORT
Each member of the audit committee is an independent director, pursuant to the independence
requirements of the SEC and NYSE. In accordance with the committee’s written charter, the committee assists
the board of directors in overseeing the quality and integrity of Pier 1 Imports’ accounting, auditing and
financial reporting practices. In performing its oversight function, the committee reviewed and discussed Pier 1
Imports’ audited consolidated financial statements as of and for the fiscal year ended March 1, 2008 with
management and Pier 1 Imports’ independent registered public accounting firm, including a discussion of 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 committee also discussed with Pier 1 Imports’
independent registered public accounting firm all matters required by generally accepted auditing standards,
including those described in Statement on Auditing Standards No. 61, “Communication with Audit Commit-
tees” and, with and without management present, discussed and reviewed the results of the independent
registered public accounting firm’s examination of the consolidated financial statements.
The committee obtained from the independent registered public accounting firm a formal written
statement describing all relationships between the firm and Pier 1 Imports that might affect the firm’s
independence consistent with Independence Standards Board Standard No. 1, “Independence Discussions with
Audit Committees”, as adopted by the Public Company Accounting Oversight Board. The committee also
discussed with the registered public accounting firm any relationships that may have an impact on their
objectivity and independence and satisfied ourselves that the registered public accounting firm is independent.
The committee also considered whether the provision of non-audit services by Ernst & Young LLP, Pier 1
Imports’ independent registered public accounting firm for fiscal 2008, to Pier 1 Imports is compatible with
maintaining Ernst & Young LLP’s independence.
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