f20fa1ex4i_ea3ungava.htm


    Exhibit
4.1

     

    AUDIT
COMMITTEE CHARTER

    


    1.0           PURPOSE

    


    1.1           
The Audit Committee (the “Committee”) is established by the Board of Directors
(the “Board”) of Ungava Mines Inc. (the “Company”) for the purpose of overseeing
the accounting and financial reporting processes of the Company and audits of
the financial statements of the Company.

    


    The
Committee is responsible for assisting the Board’s oversight of:

    


    1.1.1 the independent auditor’s
qualifications and independence;

    


    1.1.2 the performance of the Company’s
independent auditors;

    


    1.1.3 the quality and integrity of the
Company’s financial statements and related disclosure;

    


    1.1.4 oversight of the Company’s
internal and disclosure controls and reporting; and

    


    1.1.5 the Company’s compliance with
legal and regulatory requirements.

    


    2.0           COMPOSITION

    


    2.1           Members

    


    2.1.1           The
Committee shall consist of as many members as the Board shall determine, but
inany event not fewer than three members.

    


    2.1.2           The
Board shall appoint members of the Committee annually.

    


    2.2           Qualifications

    


    
      	
               
      

            	
              2.2.1

            	
              Each
      member of the Committee shall be an “unrelated” director within the
      meaning of applicable Toronto Stock Exchange (“TSX”)
      guidelines.

            


    

    


    
      	
               
      

            	
              2.2.2

            	
              Each
      member of the Committee shall be financially literate, meaning each
      member, at the time of their appointment, must be able to read and
      understand financial statements that present a breadth and level of
      complexity of accounting issues that are generally comparable to the
      breadth and complexity of the Company that can reasonably be expected to
      be raised by the Company’s financial
statements.

            


    

    


    
      2.3      Service
on Multiple Committees

    

    It is
recommended that Committee members not simultaneously serve on the committees of
more than three other public companies. If a Committee member serves on more
than two other committees, the Committee (or Board) must determine whether
membership on multiple committees impairs the ability of the member to serve on
the Committee.

    


    2.4           
Chair

    The Chair
of the Committee shall be appointed by the Committee.

    


    2.5           Removal
and Replacement

    The
members of the Committee may be removed or replaced, and any vacancies on the
Committee shall be filled, by the Board. Membership on the Committee shall
automatically end at such time as the Board determines that a member ceases to
be an unrelated director.

    


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    3.0           
OPERATIONS

    


    3.1           
Meetings

    The Chair
of the Committee, in consultation with the Committee members, shall determine
the schedule and frequency of the Committee meetings, provided that the
Committee shall meet at least four times per year.

    


    3.2           Executive
Sessions

    The
Committee shall meet separately with Management, the Corporate Treasurer and the
independent auditor in periodic executive sessions. The Committee shall also
meet separately with the independent auditor at every meeting of the Committee
at which the independent auditor is present.

    


    3.3           
Agenda

    The Chair
of the Committee, with the assistance of the Corporate Treasurer, shall develop
and set the Committee’s agenda, in consultation with other members of the
Committee, the Board and Management. The agenda and information concerning the
business to be conducted at each Committee meeting shall be, to the extent
practical, communicated to the members of the Committee sufficiently in advance
of each meeting to permit meaningful review.

    


    3.4           Report
to Board

    The
Committee shall report regularly to the entire Board and shall submit to the
Board the minutes of its meetings.

    


    3.5           
Self-Evaluation

    The
Committee shall conduct an annual performance self-evaluation and shall report
to the entire Board the results of the self-evaluation.

    


    3.6           Assessment
of Charter

    The
Committee shall review and reassess the adequacy of this Charter annually and
recommend any proposed changes to the Board for approval.

    


    4.0           COMMITTEE
AUTHORITY AND RESPONSIBILITIES

    


    4.1           
Independent Auditor’s Qualifications and Independence

      

    
      


      
        	
                 
      

              	
                4.1.1

              	
                The
      Committee shall be directly responsible for the appointment (subject to
      shareholder approval),
      retention or replacement of the independent
  auditor.

              


      

       

    

    
      	
               
      

            	
              4.1.2

            	
              The
      Committee shall be directly responsible for the compensation and oversight
      of the work of the independent auditor, (including resolution of
      disagreements between Management and the auditor regarding financial
      reporting), employed by the Company to audit its financial
      statements.

            


    

     

    
      	 	4.1.3	The
      independent auditor shall report directly to the
  Committee.


    

     

    
      	 	4.1.4	The
      Committee shall review and evaluate the experience, qualifications,
      performance and independence
      of the independent auditor.


    

     

    
      	 	4.1.5	The
      Committee shall have the sole authority to
  pre-approve:


    

     

    
      	 	 	(a)           
      all auditing services, including all audit engagement fees and terms;
      and


    

     

    
      	 	 	(b)    all
      non-audit services, including certain tax services to be performed by the
      Company’s
      independent auditor.


    

     

    
    

    
      	
               
      

            	
              4.1.6

            	
              The
      Committee shall review with the lead audit partner whether any of the
      audit partners receive any discretionary compensation from the audit firm
      with respect to non-audit services performed by the independent
      auditor.

            


    

    


    
      	
               
      

            	
              4.1.7

            	
              The
      Committee shall obtain and review with the lead audit partner and a more
      senior representative of the independent auditor, annually or more
      frequently as the Committee considers appropriate, a report by the
      independent auditor describing:

            


    

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

           

    
      


      
        	
                 
      

              	
                 (a)

              	
                the
      independent auditor’s internal quality-control
  procedures;

              


      

       

    

    
      	
               
      

            	
               (b)

            	
              any
      material issues raised by the most recent internal quality-control review,
      or peer review, of the independent auditor, or by any inquiry, review or
      investigation by governmental, regulatory or professional authorities,
      within the preceding five years, respecting one or more independent audits
      carried out by the independent auditor, and any steps taken to deal with
      these issues; and

            


    

    


    
      	
               
      

            	
              (c)

            	
              all
      relationships between the independent auditor and the Company in order to
      assess the independent auditor’s
independence.

            


    

     

    
      


      
        	
                 
      

              	
                4.1.8

              	
                
                  The
      Committee shall ensure a five-year rotation period and a five-year
      “time-out” periodof the lead audit partner having primary responsibility
      for the audit and the audit partner responsible for reviewing the audit as
      required by law and a seven-year mandatory rotation period with a two year
      “time-out” period for certain other audit partners depending on the
      partner’s involvement in the audit. In addition, the Committee shall
      consider whether, in order to assure continuing auditor independence, it
      is appropriate to adopt a policy of rotating the independent auditing firm
      on a regular basis.

                

              


      

       

      
        	 	4.1.9	The
      Committee shall recommend to the Board policies for the Company’s hiring
      of partners, employees or former partners and employees of the current and
      formerindependent auditor who participated in any capacity in the audit of
      the Company.


      

       

      
        	 	4.1.10	The
      Committee shall pre-approve the hiring of any partner, employee or former
      partner and employee of the independent auditor who was a member of the
      Company’s audit team during the preceding two fiscal years. In addition,
      the Committee shall pre-approve the hiring of any partner, employee or
      former partner or employee of the independent auditor within the preceding
      two fiscal years for senior positions within the Company, regardless of
      whether that person was a member of the Company’s audit
    team.


      

       

    

    4.2           Performance
of the Audit Functions and Independent Auditors

    


    
      	
               
      

            	
              4.2.1

            	
              The
      Committee shall discuss with Management and advise on the appointment,
      replacement, reassignment or dismissal of any senior internal auditor, if
      applicable.

            


    

    


    
      	
               
      

            	
              4.2.2

            	
              The
      Committee shall meet with Management and the independent auditor prior to
      the audit to discuss the scope, planning and staffing of the proposed
      audit for the current year.

            


    

    


    
      	
               
      

            	
              4.2.3

            	
              The
      Committee shall review and discuss with Management and the independent
      auditor, any internal audit department responsibilities, plans, results,
      budget and staffing, if applicable.

            


    

    


    


    
      	
               
      

            	
              4.2.4

            	
              The
      Committee shall review and discuss with Management the Company’s major
      financial risk exposures and the steps Management has taken to monitor and
      control such exposures, including the Company’s policies with respect to
      risk assessment and risk
Management.

            


    

    


    
      	
               
      

            	
              4.2.5

            	
              The
      Committee shall review with Management, any internal auditor and the
      independent auditor and conduct an annual assessment and a quarterly
      evaluation of the Company’s disclosure controls and procedures and the
      Company’s internal controls over financial reporting and determine if
      there are any significant deficiencies or weaknesses in the Company’s
      control procedures. The Committee shall review with Management the
      Company’s anti-fraud control
procedures.

            


    

    


    
      	
               
      

            	
              4.2.6

            	
              The
      Company shall provide for appropriate funding, as determined by the
      Committee, for payment of compensation to the independent auditor for the
      purpose of rendering or issuing an audit report and to any advisors
      employed by the Committee.

            


    

    


    


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    


    4.3           
Financial Statements and Related Disclosure

    


    
      	
               
      

            	
              4.3.1

            	
              The
      Committee shall review and discuss with Management and the independent
      auditor the Company’s annual audited financial statements, including the
      Management’s discussion and analysis before the filing of such
      statements.

            


    

    


    
      	
               
      

            	
              4.3.2

            	
              The
      Committee shall review and discuss with Management and the independent
      auditor the Company’s quarterly financial statements, including the
      interim Management’s discussion and analysis, and the results of the
      independent auditor’s review of the quarterly financial statements, before
      the filing of such statements.

            


    

    


    
      	
               
      

            	
              4.3.3

            	
              The
      Committee shall discuss the independent auditor Management’s competency in
      preparing the financial statements.

            


    

    


    
      	
               
      

            	
              4.3.4

            	
              The
      Committee shall review and discuss quarterly and annual reports from the
      independent auditor on:

            


    

     

    
      	 	(a)	all
      critical accounting policies and practices to be used by the Company
      in preparing its financial
statements;


    

     

    
      	
               
      

            	
              (b)

            	
              all
      material alternative treatments of financial information within GAAP that
      have been discussed with Management, ramifications of the use of these
      alternative disclosures and treatments, and the treatment preferred by the
      independent auditor; and

            


    

    


    
      	
               
      

            	
              (c)

            	
              other
      material communications between the independent auditor and Management,
      such as any Management letter or schedule of unadjusted
      differences.

            


    

    


    
      	
               
      

            	
              4.3.5

            	
              The
      Committee shall review and discuss with Management earnings (and/or other
      financial) press releases with particular attention to the use of “pro
      forma” or “adjusted” non-GAAP information, before they are
      issued.

            


    

    


    
      	
               
      

            	
              4.3.6

            	
              The
      Committee shall review and discuss generally with Management the nature of
      the financial information and earnings guidance provided to analysts and
      rating agencies.

            


    

    


    
      	
               
      

            	
              4.3.7

            	
              The
      Committee shall review with Management, any internal auditor and the
      independent auditor disclosures made to the Committee by the Company’s CEO
      and CFO during their certification process for the quarterly and annual
      financial filings about the quality, adequacy and effectiveness of the
      Company’s internal controls over financial reporting and any significant
      deficiencies in the design or operation of internal controls over
      financial reporting or material weakness therein and any fraud involving
      Management or other employees who have a significant role in the Company’s
      internal controls over financial
reporting.

            


    

    


    
      	
               
      

            	
              4.3.8

            	
              The
      Committee shall review and discuss with Management and the independent
      auditor the effect of regulatory and accounting initiatives as well as
      off-balance sheet structures on the Company’s financial
      statements.

            


    

    


    
      	
               
      

            	
              4.3.9

            	
              The
      Committee shall discuss with Management and the independent auditor any
      audit  problems
      or difficulties and Management’s
  response.

            


    

     

    
      	 	4.3.10	The
      Committee shall review and discuss with Management and the independent
      auditor the effectiveness of the Company’s disclosure controls and
      procedures.


    

     

    
      	 	4.3.11	The
      Committee shall discuss with Management and the independent auditor
      financial reporting issues and judgments made in connection with the
      preparation of the Company’s financial statements, including any
      significant changes in the Company’s selection or application of
      accounting principles, any major issues as to the adequacy of the
      Company’s internal controls over financial reporting and any special steps
      adopted in light of material control
  deficiencies.


    

    


    
    

    


    
    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
       

      
        	 	4.3.12	
                The
      Committee shall review with Management, and any outside professionals as
      the Committee considers appropriate, important trends and developments in
      financial reporting practices and requirements and their effect on the
      Company’s financial statements.

              


      

      
         

        
          	 	4.3.13	
                  
                    The
      Committee shall review with Management any related party transactions and
      ensure such related party transactions are appropriately
      disclosed.

                  

                


        

        
 

      

    

    4.4           Compliance
with Legal and Regulatory Requirements

    


    
      	
               
      

            	
              4.4.1

            	
              The
      Committee shall discuss with Management and the independent auditor any
      correspondence with regulators or governmental agencies and any published
      reports which raise material issues regarding the
  Company.

            


    

     

    
      	 	4.4.2	The
      Committee shall establish procedures
for




    
      	 	 	(a)	the
      receipt, retention and treatment of complaints received by the
      Company  regarding accounting, internal accounting controls,
      auditing matters or potentialviolations of law;
  and


    

     

    
      	
               
      

            	 	
              (b)

            	
              the
      confidential, anonymous submission by employees of the Company of concerns
      regarding questionable accounting or auditing matters or potential
      violations of law.

            


    

    


    5.0      GENERAL

    


    
      	 	
              5.1

            	
              The
      foregoing list of duties is not exhaustive, and the Committee may, in
      addition, perform such other functions as may be necessary or appropriate
      for the performance of its oversight
function.

            


    

    


    
      	 	
              5.2

            	
              The
      Committee has the power to delegate its authority and duties to a
      subcommittee or individual members of the Committee, as it deems
      appropriate, provided that the subcommittee is composed entirely of
      unrelated directors.

            


    

    


    
      	 	
              5.3

            	
              In
      discharging its oversight role, the Committee shall have full access to
      all Company books, records, facilities and
  personnel.

            


    

    


    
      	 	
              5.4

            	
              The
      Committee may retain, and determine the fees of, independent counsel and
      other advisors, in its sole
discretion.