NASDAQ, INC.
AUDIT COMMITTEE CHARTER
APPROVED February 28, 2017 

This Charter governs the operations of the Nasdaq, Inc.  Audit Committee (the “Committee”). The Charter will be reviewed and reassessed, at least annually, by the Committee. The Committee shall be appointed by the Board of Directors in compliance with Article IV, Section 4.13(g) of the Nasdaq By-Laws and shall consist of three or more Director, each of whom is independent of management. Members of the Committee shall be considered independent if they have no relationship that may interfere with the exercise of their independence in carrying out the responsibilities of a director as defined by the Securities Exchange Act of 1934. * All Committee members will be able to read and understand fundamental financial statements, including a balance sheet, income statement, and cash flow statement. At least one member must have past employment experience in finance or accounting, requisite professional certification in accounting or any other comparable experience or background that results in the individual’s financial sophistication, including service as a Chief Executive Officer, Chief Financial Officer, or other senior officer with financial oversight responsibilities or otherwise satisfy standards for financial expertise required for audit committees of companies listed on the NASDAQ Stock Market. 

The primary function of the Audit Committee is to assist the Board of Directors in fulfilling its oversight responsibilities by reviewing the financial information, which will be provided to the shareholders and others, the systems of internal controls, which management and the Board of Directors have established, and Nasdaq, Inc.'s audit, financial reporting and the legal and compliance process. Additionally, the Committee provides oversight of the Enterprise Risk Management (ERM) program including the risk governance structure, risk metrics, risk assessment and strategy as it relates to key risks, including regulatory, credit, operational, and technology and information systems, including cyber security. In so doing, it is the responsibility of the Committee to maintain free and open communication with independent auditors, internal auditors, ERM management and Nasdaq, Inc.'s management. In discharging its oversight role, the Committee is empowered to investigate any matter brought to its attention with full access to all books, records, facilities, and personnel of Nasdaq, Inc. and the power to retain independent counsel, or other experts, and funding sufficient for this purpose.

The primary responsibility of the Committee is to oversee Nasdaq, Inc.'s financial reporting process on behalf of the Board of Directors and report the results of these activities to the Board. Management is responsible for preparing Nasdaq, Inc.'s financial statements, and the independent auditors are responsible for auditing those financial statements. The Committee in carrying out its responsibilities believes its policies and procedures should remain flexible, in order to best react to changing conditions and circumstances. The Committee should take the appropriate actions to set the overall corporate policy for quality financial reporting, sound business risk management practices, and ethical behavior.

The following shall be the principal recurring processes of the Committee in carrying out its responsibilities. The processes are set forth as a guide with the understanding that the Committee may supplement them as appropriate. The responsibilities and processes of the Committee shall be consistent with the Exchange Act and the rules and regulations adopted by the SEC.

  1. The Committee will meet at least four times a year, with authority to convene additional meetings as circumstances require. All Committee members are excepted to attend each meeting, either in person or via tele-or-video conference. The Committee will invite members of management, auditors or others to attend meeting to provide pertinent information. Meeting agendas will be prepared and provided in advance to members, along with appropriate briefing materials. The Committee will meet periodically in executive session. Minutes will be prepared.
  2. The Committee shall have a clear understanding with management and the independent auditors that the independent auditors are ultimately accountable to the Board and the Audit Committee, as representatives of Nasdaq, Inc.’s shareholders. The Committee shall have the ultimate authority and responsibility for the appointment, retention, approval of compensation and oversight of the independent auditors.    The Committee, where appropriate, will replace the independent auditors if the Committee determines that such a change would be in the company’s and its stockholders’ best interests.  The Committee shall nominate the independent auditors to be proposed for shareholder ratification in any proxy statement. In addition, the Committee shall ensure the rotation of the lead independent audit partner every five years and other audit partners every seven years and participate in the selection of the lead audit partner.

     
  3. The Committee is responsible for ensuring its receipt from the independent auditors at least annually of a formal written statement delineating all relationships between the auditor and Nasdaq, Inc., consistent with the applicable requirements of the Public Accounting Oversight Board. The Committee shall actively engage in dialogue with the independent auditors with respect to any disclosed relationships or non-audit fees and services that may impact the objectivity and independence of the auditor and for taking, or recommending that the full board take, appropriate action to oversee the independence of the independent auditor. Additionally, the Committee shall review with the independent auditors any audit problems or difficulties and management responsiveness. The Committee shall prescribe what services are allowable by the independent auditors and approve in advance all services provided by the auditors (see Independent Public Auditor Services section). The Committee shall review all proposed Nasdaq, Inc. hires formerly employed by the independent auditors.
  4. The Committee shall discuss with the Head of Internal Audit and the independent auditors the overall scope and risk based plans for their respective audits including the adequacy of staffing, compensation, and resources. Also, the Committee shall discuss with management, the Head of Internal Audit , and the independent auditors the adequacy and effectiveness of Nasdaq, Inc.’s internal controls, including systems to monitor and manage business risk, and legal and ethical compliance programs and financial reporting. Further, the Committee shall meet separately with the Head of Internal Audit and the independent auditors, with and without management present, to discuss the results of their examinations. The internal auditors shall report directly to the Committee and have free and open access to information deemed necessary by them to perform their assessments. The Committee shall provide oversight over the system of internal controls, relying upon management’s and the internal and independent auditor’s representations and assessments of the controls, and annually approve the internal audit plan,  major changes to that plan, and the internal audit charter. 
  5. The Committee shall review and discuss with management the Company's Enterprise Risk Management process including risk governance structure, risk assessment and risk management practices and guidelines.
  6. The audit committee will meet periodically with the internal auditors and assist the Board in its oversight of the performance of the internal audit function. The audit committee will also discuss with the outside auditor the responsibilities, budget and staffing of the internal audit function. The Committee shall review the effectiveness of the Head of Internal Audit and the internal audit function, including assessing their effectiveness according to industry standards.  The Committee will discuss the adequacy of resources and scope of the annual internal audit plan with the Head of Internal Audit.  Also, the Committee will review and concur in the appointment, replacement, or dismissal of the Head of Internal Audit. 
  7. Annually, the committee evaluates the performance of the independent auditor.  As one of the inputs for this review, the committee receives and reviews, at least annually, a report by the Independent Auditors describing: (a) the Independent Auditors' internal quality-control procedures; and (b) any material issues raised by the most recent internal quality-control review, or peer review, 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 Independent Auditors, and any steps taken to deal with any such issues. .
  8. The Committee shall review the interim financial statements and earnings releases with management and the independent auditors prior to the filing of Nasdaq, Inc.'s quarterly report on Form 10-Q. Also, the Committee shall discuss the results of the quarterly review and any other matters required to be communicated to the Committee by the independent auditors under generally accepted auditing standards.
  9. The Committee shall review with management and the independent auditors the financial statements to be included in Nasdaq, Inc.'s annual report on Form 10-K (or the annual report to shareholders if distributed prior to the filing of Form 10-K) and quarterly reports on Form-Q, including MD&A disclosures, their judgment about the quality, not just acceptability, of accounting principles, the reasonableness of significant judgments, and the clarity of the disclosures in the financial statements. Also, the Committee shall discuss the results of the annual audit, including the management letters, reports and attestations prepared by management and the independent auditors to comply with the Exchange Act and any other matters required to be communicated to the Committee by the independent auditors under generally accepted auditing standards and SEC rules.
  10. The Committee shall review and approve all related party transactions consistent with the rules applied to companies listed on the NASDAQ Stock Market.
  11. The Committee shall have responsibility for, and oversight of, a confidential and anonymous process and procedures for the receipt, retention and treatment of submissions regarding accounting, audit, internal accounting controls and enterprise risk matters. All such submissions must be reported to the Committee.
  12. The Committee shall provide oversight for the code of ethics program including the code, related policies, communication of the code of ethics to employees and monitoring employee awareness and compliance to the program.
  13. The Committee shall oversee the adequacy and effectiveness of the regulatory and self-regulatory organization responsibilities of Nasdaq, Inc. and its subsidiaries; assess regulatory performance; and assist the Board and other committees of the Board in reviewing the regulatory plan and the overall effectiveness of regulatory functions.
  14. The Committee shall review, and recommend to the Board for approval, the Company’s regular cash and stock dividends
  15. An annual performance appraisal of the Audit Committee is conducted among the members and the results are reviewed by the Audit Committee. 

 

__________________
*Directors shall meet the standards for independence set forth in Section 10A(m) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the rules promulgated by the Securities and Exchange Commission (the "SEC") and Nasdaq Stock Market Rule 5605, as amended. The composition and responsibilities of the Committee also will be consistent with SEC guidance, and in particular with the SEC Order set forth in Release No. 34-37538.

The independent auditor is prohibited from performing any of the following services for Nasdaq, Inc.:

  • bookkeeping or other services related to the accounting records or financial statements of the audit client;


  • financial information systems design and implementation;


  • appraisal or valuation services, fairness opinions, or contribution-in-kind reports;


  • actuarial services;


  • internal audit outsourcing services;


  • management or human resources functions;


  • broker or dealer, investment adviser, or investment banking services;


  • legal services and expert services unrelated to the audit; and


  • any other service that the Public Company Accounting Oversight Board determines, by regulation, is impermissible.


All audit and allowable non-audit services must be approved in advance by the Committee. However, the Chairman of the Committee is delegated authority to approve in advance audit and non-audit services by the independent auditor to support business development, consulting on accounting issues (subject to the prohibitions above) or tax consulting to the extent permitted by SEC rules, if such non-audit services do not exceed $300,000 in the aggregate between meetings of the Committee and the Committee is informed of such pre-approval by the Chairman at the Committee's next meeting.


Committee Members

Thomas A. Kloet
Thomas A. Kloet
Retired Chief Executive Officer and Executive Director

Thomas A. Kloet was the first CEO and Executive Director of TMX Group Limited, the holding company of the Toronto Stock Exchange, TSX Venture Exchange, Montreal Exchange, Canadian Depository for Securities, Canadian Derivatives Clearing Corporation and the BOX Options Exchange from 2008-2014. Previously he served as Senior Executive Vice President and COO of Fimat America’s from 2003-2008 overseeing all operating units of the US broker-dealer of Société Générale. Mr. Kloet served as CEO of the Singapore Exchange from 2000-2002 and as senior vice president and chief administrative officer of ABN AMRO from 1997-2000. Mr. Kloet served as a board member, treasurer and clearing chairman of the Chicago Mercantile Exchange from 1995-2000.  He served as COO of Credit Agricole Futures, Inc. from 1990-1997, CFO of Index Futures Group from 1988-1990, Director of Internal Audit at CME from 1985-1988 and Regulatory Staff Auditor at CME from 1981-1982. Mr. Kloet is a Certified Public Accountant and a member of the AICPA. He is also a member of the CFTC’s Market Risk Advisory Committee and was inducted into the Futures Industry Association Hall of Fame in March 2015.

Melissa M. Arnoldi
Melissa M. Arnoldi
Senior Executive Vice President

Melissa Arnoldi, senior executive vice president, Technology & Operations, AT&T Communications, a wholly-owned subsidiary of AT&T Inc., is responsible for technology development, network deployment and operations, and AT&T’s transition to a software-defined and future 5G network. Melissa currently serves as a board member of Nasdaq & Girl Scouts of Northeast Texas.

Melissa leads the company’s networks and technologies team, which has driven AT&T’s global leadership in the technological transition to software-defined networking – with a focus on virtualized or cloud-based network controls – as well as the company’s leadership in the move to 5G networks. Melissa oversees the company’s global information, software development, supply chain, network and cybersecurity operations, and chief data office organizations, as well as AT&T’s Intellectual Property group, Labs and Foundries.

Prior professional experience includes serving as President of Technology Development of AT&T’s products and services, digital experiences for customers, information and network security strategy, standards and platform development, and systems supporting the operations across multiple business segments, networks, and services. Previous to that postion, Melissa has served various roles in technology development and systems strategy organizations supporting AT&T’s Mobility and Home Solutions (U-verse and legacy voice, iPhone launches, high-speed broadband and TV) business units.

Melissa is passionate about diversity and inclusion.. She has been honored as one of the National Diversity Council’s “Top 50 Most Powerful Women in Technology” and received a Silver Stevie Award for Women in Business for “Maverick of the Year” in 2015.  In 2016, Melissa was showcased by Fierce Wireless as a woman leader to watch due to her key contributions in engineering and technology fields in the telecom industry.

Melissa came to AT&T from Accenture as Senior Executive, where she served in roles of increasing responsibility focused on IT merger integration, system consolidation and product development during her 12-year tenure. She holds a Bachelor’s degree in Accounting from the University of Memphis and a Master’s of Business Administration from Georgia State University. She lives in Dallas with her husband and their two daughters.

Charlene T. Begley
Charlene T. Begley
Retired Senior Vice President and Chief Information Officer

Charlene T. Begley served in various capacities for the General Electric Company, a diversified infrastructure and financial services company, from 1988 through December 2013. Most recently, Ms. Begley served in a dual role as GE’s Senior Vice President and Chief Information Officer, as well as the President and Chief Executive Officer of GE’s Home and Business Solutions business from January 2010 through December 2013. Previously, Ms. Begley served as President and Chief Executive Officer of GE Enterprise Solutions from August 2007 through December 2009. Over her career at GE, Ms. Begley also served as President and Chief Executive Officer of GE Plastics and GE Transportation. She also led GE’s Corporate Audit staff and served as the Chief Financial Officer for GE Transportation and GE Plastics Europe and India. Ms. Begley is a director and member of the audit and nominating & governance committees of Red Hat and is a director of Hilton Worldwide Holdings, Inc.

John D. Rainey, Jr.
John D. Rainey, Jr.
Executive Vice President and Chief Financial Officer

John D. Rainey, Jr. is Executive Vice President and Chief Financial Officer of PayPal Holdings, Inc., a company that creates innovative technology to make the management and movement of money safer, simpler and more affordable over 200 markets around the globe. Prior to joining PayPal in 2015, Mr. Rainey was Executive Vice President and CFO at United Airlines, having spent 18 years at Continental Airlines, and later United Airlines.

Lars R. Wedenborn
Lars R. Wedenborn
Chief Executive Officer

LARS WEDENBORN, CEO of FAM (Foundation Asset Management) fully owned by Wallenberg foundations, is a Swedish citizen and has a Master of Science degree in Economics from the University of Uppsala. He started his career as auditor followed by an assignment as CFO at Cabanco. During 1991-2000 he was Deputy Managing Director and CFO at Alfred Berg, a Scandinavian investment bank. He served with Investor AB, a Swedish holding company, as Executive Vice President and CFO, 2000-2007. Mr. Wedenborn is Chairman of the Board of the NASDAQ OMX Nordic Ltd. and also a member of the boards of SKF and The Grand Hotel.


Scroll up