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Content-Type: text/plain; charset=ANSI_X3.4-1968 Content-Transfer-Encoding: quoted-printable X-From: exchangeinfo@nymex.com X-To: tana.jones@enron.com X-cc: X-bcc: X-Folder: \Tanya_Jones_Dec2000\Notes Folders\All documents X-Origin: JONES-T X-FileName: tjones.nsf Notice No. 00-392 November 17, 2000 TO: ALL NYMEX AND COMEX DIVISION MEMBERS FROM: Neal L. Wolkoff, Executive Vice President DATE: November 17, 2000 RE: Notice of CFTC Approval of Amendments to NYMEX Rule 3.47 ("Audit=20 Committee") ____________________________________________________________________ Please be advised that the CFTC has approved amendments to NYMEX Rule 3.47= =20 ("Audit Committee"), which are shown below and are now in effect. The=20 amendments add an additional Public Director and expand the duties of the= =20 Audit Committee to encompass consideration of the information to be include= d=20 in NYMEX filings to the SEC. If you have any questions, please contact Michael Lugo, Vice President of= =20 Internal Auditing, at (212) 299-2268. APPROVED AMENDMENTS TO NYMEX RULE 6.40A (An asterisk indicates deletions; parentheses indicate deletions.) Rule 3.47 AUDIT COMMITTEE (A) The Audit Committee shall be a regular committee and shall consist of t= he=20 Chairman of the Board and *two*(three) Public Directors appointed by the=20 Board. One of the Public Directors shall serve as Chairman of the Committe= e (B) The Audit Committee shall: (i) *on* (On) an annual basis: (a) make a recommendation to the Board of Directors regarding selection,=20 retention and discharge of independent auditors for the ensuing year; and (b) *(b)* review the scope and general extent of the independent auditors= =01,=20 examination, the significant audit procedures which will be utilized, and= =20 fees charged for their services. ((ii) Review the audited financial statements and discuss them with=20 management and the independent auditors. These discussions shall include, b= ut=20 not be limited to, the matters required to be disclosed under Statement of= =20 Auditing Standards No. 61 (established by the Auditing Standards Board) and= =20 consideration of the quality of the Exchange=01,s accounting principles as= =20 applied in its financial reporting, including a review of sensitive=20 accounting estimates, reserves and accruals, judgement areas, audit=20 adjustments (whether or not recorded), and other such inquires as the=20 Committee or the independent auditors shall deem appropriate. Based on suc= h=20 review, the Committee shall make its recommendation to the Board as to the= =20 inclusion of the Exchange=01,s audited financial statements in the Exchange= =01,s=20 Annual Report on Form 10-K. (iii) Discuss with representatives of management and the independent audito= rs: (a) the interim financial information contained in the Exchange=01,s Quarterly Report on Form 10-Q prior to its filing; and (b) the results of the review by the independent auditors.) (iv) *(ii) on* (On) a monthly basis, or at such times as the Committee shal= l=20 determine, but not less than twice each year, meet with the independent=20 auditors, President, Senior Vice President of Finance, *Director* (Vice=20 President) of Internal Audit and other personnel as the Committee deems=20 appropriate to review: (a) the scope of the audit plan; (b) the Exchange=01,s financial statements; © the results of external and internal audits; (d) the effectiveness of the Exchange=01,s system of internal controls; (e) any limitations imposed by Exchange personnel on the independent=20 auditors; and (f) such other matters as the Committee shall deem appropriate upon advisin= g=20 the Executive Committee. ((v)) * review *(Review) the internal audit function of the Exchange,=20 including proposed audit programs for the coming year, the coordination of= =20 such a programs with the independent auditors, the extent to which=20 recommendations made by the internal auditors or by the independent auditor= s=20 have been implemented, and management=01,s response to the recommendations = of=20 the independent *auditors;* (auditors.) (vi) *(iv)review,* (Review,) at its discretion, compliance with codes of= =20 conduct established the * Exchange;*(Exchange.) ((vii)) * consult* (Consult) with the independent auditors, and when=20 appropriate the * Director* (Vice President) of Internal Audit, out of the= =20 presence of management. * establish * ((viii)Establish) direct communication between the auditors= =20 and the * Board; * (Board) ((ix))* initiate* (Initiate,) at its discretion, investigations within the= =20 parameters of foregoing responsibilities, and for that purpose with the=20 approval of the Board, retain outside legal counsel, independent auditors, = or=20 any other such experts as if may deem *appropriate; and* (appropriate.) ((x)) * report* (Report) to the entire Board at such time as the (Committe= e=20 determines,) but not less than twice a year on the activities described in= =20 this Rule. __________________________________________________ Please click on the link below to indicate you have received this email. 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