Corporate Governance

Code of Conduct and Ethics

The Board of Directors and Management have adopted a Code of Business Conduct and Ethics that applies to, among other persons, our President (being our principal executive officer) as well as all employees. As adopted, our Code of Business Conduct and Ethics sets forth written standards that are designed to deter wrongdoing and to promote:

• Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships
• Full, fair, accurate, timely, and understandable disclosure in reports and documents that we file with, or submit to, the SEC and in other public communications made by us
• Compliance with applicable governmental laws, rules and regulations
• The prompt internal reporting of violations of the Code of Business Conduct and Ethics to an appropriate person or persons identified in the Code of Business Conduct and Ethics
• Accountability for adherence to the Code of Business Conduct and Ethics

Our Code of Business Conduct and Ethics requires, among other things, that all of our company's personnel are accorded full access to our President with respect to any matter that may arise relating to the Code of Business Conduct and Ethics. Further, all of our company's personnel are to be accorded full access to our Board of Directors if any such matter involves an alleged breach of the Code of Business Conduct and Ethics by our President.

In addition, our Code of Business Conduct and Ethics emphasizes that all employees, and particularly managers and/or supervisors, have a responsibility for maintaining financial integrity within our company, consistent with generally accepted accounting principles, and federal, provincial and state securities laws. Any employee who becomes aware of any incidents involving financial or accounting manipulation or other irregularities, whether by witnessing the incident or being told of it, must report it to his or her immediate supervisor or to our company's President. If the incident involves an alleged breach of the Code of Business Conduct and Ethics by the President, the incident must be reported to any member of our Board of Directors. Any failure to report such inappropriate or irregular conduct of others is to be treated as a severe disciplinary matter. It is against our company policy to retaliate against any individual who reports in good faith the violation or potential violation of our company's Code of Business Conduct and Ethics by another.

Each year, all employees and directors will be required to sign a document reiterating their agreement to adhere to this Code of Conduct and Ethics.

Effective Date: September 1, 2009.

Audit Committee Charter

I. MISSION STATEMENT AND PURPOSE

The purpose and primary function of this “Audit Committee Charter” is to assist the International Monetary Systems Board of Directors in fulfilling its fiduciary oversight responsibilities of reviewing: the financial reports and other financial information provided by IMS to any governmental board or the public; IMS’ system of internal controls regarding finance, accounting, legal compliance and ethics that management and the board have established; and IMS’ auditing, accounting and financial reporting processes generally. Consistent with this function, the audit committee should encourage continuous improvement of, and should foster adherence to, IMS’ policies, procedures and practices at all levels. The audit committee’s primary duties and responsibilities are to: serve as an independent and objective party to monitor IMS’ financial reporting process and the internal control system, review and appraise the audit efforts of IMS’ external auditors, and provide an open avenue of communication among the external auditors, financial and senior management, and the Board of Directors.

II. ORGANIZATION OF THE AUDIT COMMITTEE

International Monetary Systems’ audit committee shall include no less than two members as determined by the board of directors, each of whom shall be independent directors, and free from any relationships that, in the opinion of the board, would interfere with the exercise of his or her independent judgment as a committee member. Each member shall be considered financially literate, and the chairperson shall qualify as a “financial expert” as defined in the regulations of the U.S. Securities and Exchange Commission. Committee members may enhance their familiarity with finance and accounting by attending educational programs conducted by IMS or an outside consultant.

Committee members shall be elected by the board at the annual organizational board meeting and will serve until their successors have been duly elected and qualified. Unless a chair is elected by the full board, the committee members may designate a chair by majority vote of the full committee membership. To remain a member in good standing, committee members must be present at 50% of regularly scheduled meetings each year. Participation by teleconference is permitted.

III. FREQUENCY OF MEETINGS

The audit committee of International Monetary Systems shall hold meetings at least two times per year. Special and telephonic meetings may be called as the audit committee chairperson deems necessary to conduct the committee’s business.

As part of its job to foster open communication, the committee should meet at least twice per year with management and the external auditor in separate executive sessions to discuss any matters that the committee of each of these groups believes should be discussed privately. The committee, or at least its chair, also should meet quarterly with the external auditors and management to ensure that IMS’ financial statements are consistent with Section IV below

IV. RESPONSIBILITIES

To fulfill its responsibilities and duties, the audit committee shall:

• Review and update this charter periodically, at least annually, as circumstances warrant.
• Review IMS’ annual financial statements and any reports or other financial information, including footnote disclosures, submitted to any governmental agency, or the public, including any certification, report, opinion, or review rendered by the external auditors.
• Review and approve, at least annually, the audit plan and the proposed audit cycle.
• Meet with IMS' officers, external auditors, outside counsel and/or specialists, as necessary.

The audit committee will primarily fulfill these responsibilities by carrying out its oversight activities in the areas of:

• Financial Reporting Process
• System of Risk Management
• System of Internal Control
• External Audit of the Financial Statements
• International monetary Systems' Processes for Monitoring Compliance with Laws and Regulations and the Ethics Policy, Code of Conduct and Fraud Policy
• Special Investigations and Whistleblower Mechanism
• Audit Committee Management and Reporting Responsibilities

Financial Reporting Process

• Review with management and the external auditors the results of the audit, including any difficulties encountered.
• Review all significant adjustments proposed by the external financial statement auditor.
• Review all significant suggestions for improved financial reporting made by the external financial statement auditor.
• Review with the General Counsel the status of legal matters that may have an effect on the financial statements.
• Review the annual financial statements, and consider whether they are complete, consistent with information known to committee members, and reflect appropriate accounting principles.
• Review with management and the external auditors all matters required to be communicated to the committee under generally accepted auditing Standards.
• Understand how management develops interim financial information, and the nature and extent of external auditor involvement.
• Review the statement of management responsibility for and the assessment of the effectiveness of the internal control structure and procedures of the organization for financial reporting. Review the attestation on this management assertion by the financial statement auditor as part of the financial statement audit engagement.

System of Risk Management

• Ensure that IMS has a comprehensive policy on risk management.
• Consider the effectiveness of the organization's risk management system, including risks of information technology systems.
• Reviews management’s reports on management’s self-assessment of risks and the mitigations of these risks.
• Understand the scope of external auditor’s review of risk management over financial reporting.

System of Internal Control

• Ensure that the organization has a comprehensive policy on internal control and compliance.
• Review periodically the policy on ethics, code of conduct and fraud policy.
• Consider the effectiveness of IMS' internal control system, including information technology security and control.
• Understand the scope of external auditor’s review of internal control over financial reporting, and obtain reports on significant findings and recommendations, together with management's responses.
• Direct employees to cooperate with the committee's requests, or the requests of internal or external parties working for the audit committee. These parties include all external auditors, consultants, investigators and any other specialists working for the audit committee.

External Audit of the Financial Statements

• Review the external auditor’s proposed audit scope and approach.
• Review the performance of the external financial statement audit firm, and exercise final approval on the request for proposal for, and the appointment, retention or discharge of the audit firm. Obtain input from the Chief Audit Executive, management and other parties as appropriate.
• Review the independence of the external financial statement audit firm by obtaining statements from the auditors on relationships between the audit firm and IMS, including any non-audit services, and discussing these relationships with the audit firm. Obtain from management a listing of all services provided by the external audit firm. Obtain information from the Chief Audit Executive and other sources as necessary.
• Review and approve the audited financial statements, associated management letter, attestation on the effectiveness of the internal control structure and procedures for financial reporting, other required auditor communications, and all other auditor reports and communications relating to the financial statements.
• Review and approve all other reports and communications made by the external financial statement auditor.
• Review the responsiveness and timeliness of management’s follow-up activities pertaining to any reported findings and recommendations.
• On a regular basis, meet separately with the external financial statement audit firm to discuss any matters that the committee or auditors believe should be discussed privately {Subject to open meeting laws}.
• Ensure production of a report of all costs of and payments to the external financial statement auditor. The listing should separately disclose the costs of the financial statement audit, other attest projects, agreed-upon-procedures and any non-audit services provided.

International Monetary Systems’ Processes for Monitoring Compliance

• Review the effectiveness of the system for monitoring compliance with laws and regulations and the results of management's investigation and follow-up (including disciplinary action) of any instances of noncompliance.
• Review the findings of any examinations by regulatory agencies, and any auditor observations, including investigations of misconduct and fraud.
• Review the process for communicating to all affected parties the ethics policy, code of conduct and fraud policy to organization personnel, and for monitoring compliance therewith.
• Obtain regular updates from management and organization legal counsel regarding compliance matters.

Special Investigations and Whistleblower Mechanism

• Institute and oversee special investigations as needed.
• Provide an appropriate confidential mechanism for whistleblowers to provide information on potentially fraudulent financial reporting or breaches of internal control to the audit committee.

Audit Committee Management and Reporting Responsibilities

• Regularly report to the Board of Directors about all committee activities, issues, and related recommendations.
• Perform other activities related to this charter as requested by the Board of Directors, and report to the Board.
• Provide an open avenue of communication between the external financial statement auditors, management and the Board of Directors.
• Confirm annually that all responsibilities outlined in this charter have been carried out. Report annually to the Board, describing the committee's composition, responsibilities and how they were discharged, and any other information required by rule, including approval of non-audit services.
• Evaluate the committee's and individual member’s performance on a regular basis, and report to the Board.

Additional Duties

External Auditors

The IMS audit committee should:

• Recommend to the board of directors the selection of the external auditors, considering independence and effectiveness and approve the fees and other compensation to be paid to the external auditors;
• Pre-approve the engagement of the external auditor or other independent accountant to conduct any non-audit services to be performed during the year;
• On an annual basis, the committee should review and discuss with the external auditor all significant relationships the auditors have with IMS to determine the auditor’s independence;
• Review the performance of the external auditors and approve any proposed discharge of the external auditors when circumstances warrant; and
• Periodically consult with the external auditors out of the presence of management about internal controls and the fullness and accuracy of IMS’ financial statements.

Financial Reporting Processes

In consultation with the external auditor, review the integrity of IMS’ financial reporting processes, both internal and external.

• Consider the external auditor’s judgments about the quality and appropriateness of IMS’ accounting principles as applied in its financial reporting.
• Consider and approve, if appropriate, any major changes to IMS’ accounting and auditing principles and practices as suggested by the external auditors or management.

Process Improvement

• Establish regular and separate methods of reporting to the audit committee by management and the external auditors regarding any significant judgments made in management’s preparation of the financial statements, and solicit the view of each regarding the appropriateness of such judgments.
• Following completion of the annual audit, review separately with management and the external auditors any significant difficulties encountered during the course of the financial statement/internal controls audits, including any restrictions on the scope of work or access to required information.
• Review any significant disagreements among management and the external auditors in connection with the preparation of the financial statements or the design, existence, or effectiveness of internal controls.
• Review with management and the external auditors the extent to which changes or improvements in financial or accounting practices, as approved by the Audit Committee, have been implemented. This review should be conducted at an appropriate time before the expected implementation of changes or improvements, as approved by the committee.

Ethical and Legal Compliance

• Review and recommend periodic updates to IMS’ code of ethical conduct and ensure that management has established a system to enforce this code.
• Review management’s monitoring of IMS’ compliance with its ethical code, and ensure that management has the proper review system in place to ensure that IMS’ financial statements, reports and other financial information disseminated to regulatory agencies, and the public satisfy legal requirements.
• Establish an anonymous whistleblower hot line and monitor any comments received from employees, customers or suppliers.
• Review, with IMS’ legal counsel, any legal compliance matters including corporate securities trading policies.
• Review, with IMS’ legal counsel, any legal matter that could have a significant impact on IMS’ financial statements.

Other

• The audit committee chair shall make a full report of its activities at each meeting of the Board of Directors.
• The audit committee shall maintain complete and faithful minutes of its meetings.
• The audit committee shall perform an annual self-assessment of its effectiveness.

Authorities

The board of directors of International Monetary Systems grants the following authorities to its audit committee in performance of its duties:

• The audit committee may perform any other activities consistent with the intent of this charter, IMS’ by-laws and governing law, as the committee or the board deems necessary or appropriate.
• The audit committee is empowered to demand that external auditors have full access to all employees, accounts and records of IMS.
• The audit committee shall investigate any internal or external accounting or auditing irregularities reported on IMS’ whistleblower hot line, including engaging a forensic accountant if circumstances warrant.
• The audit committee is authorized to hire any consultant, accountant or attorney to advise the committee as the committee deems necessary.