CORPORATE GOVERNANCE
First Foundation Inc.
Charter for the Audit Committee of the Board of Directors
I. Audit Committee Purpose
The Audit Committee shall be appointed by the Board of Directors of First Foundation Inc. (the
“Company”), to assist the Board in fulfilling its oversight responsibilities regarding the Company’s accounting
and system of internal controls, the quality and integrity of the Company’s financial reports and the
independence and performance of the Company’s outside auditor.
The Audit Committee’s responsibility is oversight. Management of the Company has the responsibility
for the Company’s financial statements as well as the Company’s financial reporting process, principles and
internal controls. The outside auditor is responsible for performing an audit of the Company’s annual financial
statements, expressing an opinion as to the conformity of such annual financial statements with generally
accepted accounting principles, reviewing the Company’s quarterly financial statements and other procedures.
It is recognized that the members of the Committee are not engaged in the accounting or auditing profession
and, consequently, are not experts in matters involving auditing or accounting including in respect of auditor
independence. As such, it is not the duty of the Committee to plan or conduct audits or to determine that the
Company’s financial statements fairly present the Company’s financial position and results of operation and are
in accordance with generally accepted accounting principles and applicable laws and regulations. Each member
of the Committee shall be entitled to rely on (i) the integrity of those persons within the Company and of the
professionals and experts (such as the outside auditor) from which it receives information, (ii) the accuracy of
the financial and other information provided to the Committee by such persons, professionals or experts absent
actual knowledge to the contrary. The Audit Committee’s primary duties and responsibilities are to:
• Provide oversight of the integrity of the financial statements of the Company and its subsidiaries;
• Provide oversight of the independence, qualifications and performance of the Company’s independent
auditors;
• Provide oversight of the Company’s and its subsidiaries’ compliance with legal and regulatory
requirements.
II. Audit Committee Composition and Meetings
The Audit Committee shall be comprised of at least three directors, each of whom shall be independent
non-executive directors, free from any relationship that would interfere with the exercise of his or her
independent judgment. Each member of the Audit Committee shall be financially literate, as such qualification
is interpreted by the Company’s Board in its business judgment. At least one member of the Audit Committee
shall have accounting or related financial management expertise. If a joint Audit Committee structure is in place,
one of the three members set forth above can be a Director of First Foundation Bank that meets the independence
requirements outlined above. This First Foundation Bank Director will be authorized to vote on matters relating to
the Company and will be considered a member for purposes of determining if a quorum exists.
The Audit Committee shall meet periodically in separate executive sessions with management, the
independent auditors and as a committee to discuss any matters that the Committee or each of those groups
believe should be discussed. The Audit Committee may meet jointly with the Audit Committee of First
Foundation Bank, the banking subsidiary of the Company.
CHARTER FOR THE AUDIT COMMITTEE
Investment Management Wealth Planning Consulting Trust Banking
1
CORPORATE GOVERNANCE
CHARTER FOR THE AUDIT COMMITTEE (con’t)
The Audit Committee shall have the authority to conduct any investigation it deems necessary to fulfill its
responsibilities and shall have direct access to the independent auditors, third parties performing internal audit
processes as well as anyone in the Company.
III. Audit Committee Responsibilities and Duties
The Audit Committee shall:
1. Meet to review and discuss with management and the independent auditors the Company’s quarterly and
annual financial statements, including any required disclosures.
2. Review and discuss the risk assessment and risk management policies of the Company and its subsidiaries,
including the review and discussion of significant financial risk exposures and the steps management has
taken to monitor, control, and report such exposures.
3. Oversee the integrity of the Company’s financial reporting process, business risk assessment, compliance with
applicable laws and regulations and the adequacy of underlying internal controls. Review and discuss with
the independent auditors and management guidelines and policies with respect to risk assessment and risk
management.
4. Review major issues regarding accounting principles and financial statement presentations, including any
significant changes in the Company’s selection or application of accounting principles, any major issues as to
the adequacy of the internal controls of the Company and its subsidiaries and any special steps adopted in
light of any material control deficiencies identified.
5. Discuss with management and the independent auditors the effect(s) of regulatory and accounting initiatives
as well as off-balance sheet structures on the Company’s financial statements.
6. Evaluate the qualifications, performance and independence of the independent auditors, including
considering whether the auditors’ internal quality controls are adequate and the provision of non-audit
services is compatible with maintaining the auditors’ independence.
7. Assume direct responsibility for the compensation and oversee the work of the independent auditors
(including resolution of disagreements between management and the independent auditors regarding
financial reporting) for purposes of preparing or issuing an audit report or related work. The independent
auditors shall report directly to the Audit Committee.
8. Pre-approve all auditing services and permitted non-audit services to be performed for the Company by its
independent auditors.
CHARTER FOR THE AUDIT COMMITTEE
Investment Management Wealth Planning Consulting Trust Banking
2
CORPORATE GOVERNANCE
CHARTER FOR THE AUDIT COMMITTEE (con’t)
9. Discuss certain matters required to be communicated to audit committees in accordance with AICPA SAS
61.Statement of Auditing Standards (SAS) No. 61 requires auditors to discuss certain matters with audit
committees. The communication may be in writing or oral and may take place before or after the financial
statements are issued. Items to be communicated include: (i) The auditors’ responsibility under Generally
Accepted Auditing Standards (GAAS); (ii) Significant accounting policies; (iii) Management’s judgments and
accounting estimates; (iv) Significant audit adjustments; (v) Other information in documents containing
audited financial statements; (vi) Disagreements with management – including accounting principles, scope
of audit, disclosures; (vii) Consultation with other accountants by management; (viii) Major issues discussed
with management prior to retention; and (ix) Difficulties encountered in performing the audit.
10. Discuss with management and the independent auditors any correspondence with regulators or other
governmental agencies regarding the Company’s financial statements or accounting policies.
11. Establish procedures for the receipt, retention and treatment of complaints received by the Company
regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous
submissions by Company employees of concerns regarding questionable accounting or auditing matters.
12. Report on the activities of the Audit Committee to the Board of Directors on a regular basis and make such
recommendations with respect to the above and other matters as the Committee may deem necessary or
appropriate.
13. Maintain minutes of meetings and periodically report to the Board.
CHARTER FOR THE AUDIT COMMITTEE
Investment Management Wealth Planning Consulting Trust Banking
3