Term
| Articles of Incorporation |
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Definition
| The document filed with the secretary of the state to obtain a certification of incorporation. |
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Definition
| The committee of the board of directors that oversees the accounting and financial reporting processes of the company and oversses the audits of the financial statements of the company. The Sarbanes-Oxley Act requires all members to be independent. |
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| Evaluating the occurrence of evernts that had negative effects and were unanticipated or viewed as highly unlikely. |
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| The body charged with running the corporation on behalf of the shareholders. |
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Definition
| A case law-derrived concept that provides that a corporate director may not be held liable for errors in judgment providing the director acted with good faith, loyalty, and due care. |
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| The committee of the board of directors that reviews and approves exectutive copmensation, makes recomendations to the board regarding incentive-based compensation, and attempts to align incentives with shareholder objectives and risk appetite. The Dodd-Frank Act requires all members to be independent. |
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Definition
| A concept that provides that directors and officers must put the interest of the corporation before thier personal interest. Accordingly, if a director is approached with a business opportunity that would be of interest to and benefit the corporation , they must first offer the opportunity to the corporation before pursuing it on thier own behalf. |
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Term
Enterprise Risk Management
ERP |
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Definition
| A process designed to identify potential events that may affect the organization, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of organizational ojectives. |
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| Set forth how the directors and/or officers are selected, how meetings are conducted, the types and duties of officers, and the required meetings. |
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| An individual that monitors internal control within an organization. |
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| Executive benefits other than compensation, such as retirement, use of corporate assets, golden parachutes, and corporate loans. |
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Definition
| The risk to the organizationif management does nothing to alter its likelihood or impact. |
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| The risk of the event after considering management's response. |
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| The amount of risk an organization is willing to accept to achieve its objectives. |
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| Analyzing the potential (likelihood and impact) effects of a risk. |
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| The acceptable variation with respect to achieving a particular objective. |
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| The minimum number of members of an assembly that must be present to make a meeting valid. |
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| A large payment or other financial compensation guaranteed to an executive dismissed as a result of a merger or takeover. |
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Definition
| A process, effected by the entity's board of directors, management, and other personnel designed to provide reasonable assurance regarding the achievement of objectives in the categories of 1) reliability of financial reporting 2) effectiveness and efficiency of operations, and 3) compliance with applicable laws and regulations. |
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