Report of the Audit Committee
The following report of the Audit Committee of the Company shall not be deemed to be soliciting material or to be filed with
the Securities and Exchange Commission, nor shall this report be incorporated by reference into any filing made by the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
The Audit Committee is operated under a charter that specifies the scope of the Committees responsibilities. The charter, which is reviewed annually
and available on the Companys website (www.apachecorp.com), was last amended and restated effective May 24, 2018.
The Board of Directors
has determined that all four members of the Committee are independent based upon the standards adopted by the Board, which incorporate the independence requirements under applicable laws, rules, and regulations, including the listing standards of
the New York Stock Exchange and the Nasdaq National Market and Rule 10A-3 of the Securities Exchange Act of 1934, as amended.
The Companys management has the primary responsibility for preparing the Companys financial statements, managing the accounting and financial
reporting processes, devising and maintaining the systems of internal controls over financial reporting, and assessing the effectiveness of internal controls over financial reporting. Ernst & Young LLP, Apaches independent registered
public accounting firm (the independent auditors), is responsible for the integrated audit of the consolidated financial statements and auditing the Companys internal controls over financial reporting. The Committees
responsibility is to monitor and oversee these processes and procedures on behalf of the Board of Directors.
The Audit Committee held eleven meetings
during fiscal year 2019, including the five in-person meetings referenced below. The meetings of the Audit Committee are designed to facilitate and encourage communication among the Audit Committee, the
Company, the Companys internal audit function, and the Companys independent auditors. Meeting agendas are set based upon the Audit Committee Charter and also include suggested topics from Committee members and/or other relevant topics.
At four of the five Audit Committee meetings held in person during 2019, the Committee met with the internal auditors and the independent auditors, with and without management present, to discuss the results of their examinations, their evaluations
of the Companys internal controls, including internal controls over financial reporting, and the overall quality of the Companys financial reporting.
The Committee is responsible for oversight of the qualifications, performance, and independence of the Companys independent auditors and annually
determines whether to retain the Companys current independent auditors. In doing so, the Committee also considers whether, in order to assure continuing auditor independence, there should be regular rotation of the independent registered
public accounting firm, which includes consideration of the advisability and potential impact of selecting a different independent public accounting firm.
In its determination to retain the current independent auditors in 2019, the Audit Committee took into consideration a number of factors, including the
historical and recent performance of the independent auditors and lead partner, its global capabilities, its knowledge of the Companys operations and industry, external data relating to audit quality and performance, including recent Public
Company Accounting Oversight Board (United States) (PCAOB) reports, and independence. The Audit Committee recognizes the importance of maintaining the independence of the Companys independent auditors, in both fact and appearance.
The Audit Committee discussed with the Companys internal auditors and the independent auditors the overall scope and plans for their respective
audits. In addition, the Audit Committee reviewed with the independent auditors, which is responsible for expressing an opinion on the conformity of the Companys audited consolidated financial statements with U.S. generally accepted accounting
principles, its judgments as to the quality, not just the acceptability, of the Companys accounting principles and such other matters as are required to be discussed with the Audit Committee by the standards of the PCAOB, including PCAOB
Auditing Standard No. 1301, Communications With Audit Committees, the rules of the Securities and Exchange Commission, and other applicable regulations. In addition, the Audit Committee has discussed with the independent auditors the
firms independence from Company management and the Company, including the matters in the letter from the firm required by PCAOB Rule 3526, Communication with Audit Committees Concerning Independence, and considered the compatibility of non-audit services with the independent auditors independence.
The Audit Committee also reviewed and
discussed together with management, the internal auditors, and the independent auditors the Companys audited consolidated financial statements included in the Companys Annual Report on
Form 10-K for the year ended December 31, 2019, including the clarity of disclosures in the financial statements, the results of managements assessment of the effectiveness of the
Companys internal controls over financial reporting, and the internal and independent auditors audits of the Companys internal controls over financial reporting.
|
|
|
|
|
APACHE CORPORATION - 2020 Proxy Statement
|
|
|
17
|
|