Audit Committee Charter

The purpose of the Audit Committee of the Board of Directors (the “Board”) of Splunk Inc., a Delaware corporation (the “Company”), shall be to:

• Provide oversight of the Company’s accounting and financial reporting processes and the audit of the Company’s financial statements;
• Assist the Board in oversight of (i) the integrity of the Company’s financial statements, (ii) the Company’s compliance with legal and regulatory requirements, (iii) the independent auditor’s qualifications, independence and performance, and (iv) the Company’s internal accounting and financial controls;
• Provide to the Board such information and materials as it may deem necessary to make the Board aware of significant financial matters that require the attention of the Board; and
• Oversee the management of risks associated with the Company’s financial reporting, accounting and auditing matters.

In furtherance of these purposes, the Audit Committee will undertake those specific duties and responsibilities listed below and such other duties as the Board may from time to time prescribe.

The Audit Committee’s responsibility is one of oversight.  The members of the Audit Committee are not employees of the Company, and they do not perform, or represent that they perform, the functions of management or the independent auditors.

The Audit Committee members shall be appointed by, and shall serve at the discretion of, the Board.  The Audit Committee shall consist of at least three members of the Board.  The Board may designate one member of the Audit Committee as its chair.  The Audit Committee may form and delegate authority to subcommittees when appropriate.  Members of the Audit Committee must meet the following criteria (as well as any criteria required by the SEC):

• Each member will be an independent director in accordance with (i) the Audit Committee requirements of the Nasdaq Stock Market, Inc. Marketplace Rules (the “Nasdaq Rules”) and (ii) the rules of the SEC;
• Each member will be able to read and understand fundamental financial statements, in accordance with the Audit Committee requirements of the Nasdaq Rules; and
• At least one member will be an “audit committee financial expert” as defined in the rules of the SEC.

The responsibilities and duties of the Audit Committee shall include:

Review Procedures

• Reviewing the reports of management and the independent auditors concerning the design, implementation and maintenance of the Company’s internal controls and procedures for financial reporting, including meeting periodically with the Company’s management and the independent auditors to review their assessment of the adequacy of such controls and to review before release the disclosure regarding such system of internal controls required under SEC rules to be contained in the Company’s periodic filings and the attestations or reports by the independent auditors relating to such disclosure;
• Reviewing and providing oversight of the external audit by (i) reviewing the independent auditors’ proposed audit scope and approach; (ii) discussing with the Company’s independent auditors the financial statements and audit findings, including any significant adjustments, management judgments and accounting estimates, significant new accounting policies, disagreements with management and any other required communications described in applicable accounting standards; (iii) reviewing with the independent auditors the Company’s critical accounting policies and practices, alternative treatments of financial information within generally accepted accounting principles that have been discussed with management, the ramifications of the use of such alternative treatments and the treatment preferred by the independent auditors, and other material written communications between the independent auditors and management; and (iv) reviewing reports submitted to the audit committee by the independent auditors in accordance with applicable SEC requirements;
• Reviewing and discussing with management and the independent auditors the annual audited financial statements and quarterly unaudited financial statements, including the Company’s disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” prior to filing the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, respectively, with the SEC;
• Recommending to the Board, if deemed appropriate, that the audited financial statements be included in the Company’s Annual Report on Form 10-K, in accordance with the rules and regulations of the SEC;
• Directing the Company’s independent auditors to review before filing with the SEC the Company’s interim financial statements included in Quarterly Reports on Form 10-Q, using professional standards and procedures for conducting such reviews;
• Conducting a post-audit review of the financial statements and audit findings, including any suggestions for improvements provided to management by internal audit or the independent auditors, and management’s response to such suggestions;
• Reviewing, prior to announcement, Company press releases and other disclosures containing financial information for the purpose of ensuring that such press releases and other disclosures properly disclose financial information presented in accordance with GAAP and, to the extent non-GAAP information is included, adequately disclose how such non-GAAP information differs from the comparable GAAP information and ensure that disclosure of such non-GAAP information is not given undue prominence and that such non-GAAP information does not provide a misleading presentation of the Company’s results of operations or financial condition;
• Providing oversight of the Company’s risk management policies, including its investment policies, and reviewing such policies on an annual basis;
• Reviewing and approving in advance any proposed related person transactions for which review or oversight is required by applicable law or that are required to be disclosed in the Company’s financial statements or SEC filings and reporting any material related party transactions to the full Board;
• Reviewing, in conjunction with counsel, any legal matters that could have a significant impact on the Company’s financial statements;
• Reviewing its own charter and processes on an annual basis;

Independent Auditors

• Having sole authority over appointing, compensating and overseeing the work of the independent auditors (including resolving disagreements between management and the independent auditors regarding financial reporting) for the purpose of preparing or issuing an audit report or related work;
• Reviewing the independence of the outside auditors, including (i) obtaining on a periodic basis a written statement from the independent auditors regarding relationships and services with the Company that may impact independence, as defined by applicable standards and SEC requirements, and discussing with the independent auditors their independence, (ii) presenting this statement to the Board, and (iii) to the extent there are relationships, monitoring and investigating them;
• Pre-approving audit and permissible non-audit services provided to the Company by the independent auditors, except where pre-approval is not required because such non-audit services are de minimis under the rules of the SEC, in which case subsequent approval may be obtained.  The Audit Committee may delegate to one or more designated members of the Audit Committee the authority to pre-approve audit and permissible non-audit services, provided such pre-approval decision is presented to the full Audit Committee at its scheduled meetings;

Regulatory Compliance and Other Matters

• Overseeing compliance with the requirements of the SEC for disclosure of auditor’s services and audit committee members, member qualifications and activities;
• Overseeing matters relating to the Company’s ongoing liquidity, including its internal and external sources of liquidity, and capital resources, including the Company’s financing arrangements;
• Reviewing management’s monitoring of compliance with the Foreign Corrupt Practices Act;
• Providing a report for inclusion in the Company’s proxy statement in accordance with the rules and regulations of the SEC; and

Establishing procedures for receiving, retaining and treating complaints received by the Company regarding accounting, internal accounting controls or auditing matters and procedures for the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.

The Audit Committee shall meet at least once each fiscal quarter.  The Audit Committee may meet either in person or telephonically, and at such times and places as the Audit Committee determines.  The Audit Committee may establish its own meeting schedule, which it shall provide to the Board.  The Audit Committee may invite to its meetings other Board members, Company management and such other persons as the Audit Committee deems appropriate in order to carry out its responsibilities.

The Audit Committee shall meet separately with the Chief Executive Officer and separately with the Chief Financial Officer of the Company at such times as it deems appropriate to review the financial affairs of the Company.  The Audit Committee will meet separately with the independent auditors of the Company at such times as it deems appropriate, but not less than quarterly.  The chair of the Audit Committee may communicate separately with the independent auditors in advance of any meeting of the Audit Committee.

The Audit Committee will maintain written minutes of its meetings, which minutes will be filed with the minutes of the meetings of the Board.

The Audit Committee shall make regular reports to the full Board on the actions and recommendations of the Audit Committee.