In accordance with the Public Governance, Performance and Accountability Act 2013 and Rule 2014, the primary functions of the Audit Committee are to review the appropriateness of the Board’s:
- financial reporting;
- performance reporting;
- system of risk oversight and management; and
- system of internal control,
for Export Finance Australia.
In addition, or to complement its primary functions, the Audit Committee will:
- monitor the risk management framework, its implementation and adherence to procedures and make recommendations to the Board on changes to the framework;
- make recommendations to the Board on the appointment, assessment and removal of the internal auditors, and oversee their independence;
- assist the Australian National Audit Office (ANAO) with the appointment, assessment and removal of external auditors, and oversee their independence;
- annually review and approve the external and internal audit fees, plans and their scope;
- monitor the internal control environment and procedures designed to achieve compliance with laws, regulations, internal standards and policies;
- oversee compliance with statutory and other legal requirements relating to financial disclosure and regulatory reporting;
- assist Export Finance Australia and its directors to comply with obligations under the Public Governance, Performance and Accountability Act 2013 (‘Cth’) (PGPA Act); and
- provide an effective forum for communication between the directors, Export Finance Australia’s senior managers and the internal and external auditors.
Duties and Responsibilities
(a) Management and internal controls
- satisfy itself that the current areas of greatest financial and operational risk to Export Finance Australia have been identified and that Management are effectively managing the risks;
- satisfy itself that effective systems of accounting, administrative and operational controls are in place to manage financial risk so that timely and meaningful financial statements are available to stakeholders.
(b) financial and performance reporting
- review the annual and half yearly financial statements and recommend acceptance to the Board;
- approve Export Finance Australia’s accounting policies and practices in the light of relevant laws, accounting standards and principles;
- satisfy itself that the relevant issues relating to dividend policy have been raised for consideration by Management to the Board;
- for the financial years 2015/2016 and onwards, review the annual performance statement and recommend acceptance by the Board.
- monitor compliance with obligations under the PGPA Act, and any other applicable legislation;
- monitor compliance with Board approved limits and controls;
- monitor changes of significance to Export Finance Australia in relation to the various laws, regulations, accounting policies and regulatory / reporting requirements that apply to Export Finance Australia.
(d) an efficient and effective audit
- review the audit philosophy adopted by the internal and external auditors and their systems and procedures;
- review and assess the findings of the internal and external auditors and the action taken and the timetable proposed by Management in response to those findings;
- review, at least annually, the scope, results and performance of the external and internal auditors;
(e) other responsibilities
- commission such special audits or investigations as may be necessary;
- perform any other tasks the Board may from time to time authorise;
- determine whether to approve of any consultants to the ANAO undertaking any non-audit consultancy work for Export Finance Australia.
The Audit Committee will consist of at least 3 members, with a minimum of 2 non-executive Directors of the Board, all of whom should have appropriate qualifications, knowledge, skills and experience to assist the Audit Committee to perform its functions.
The Board will appoint Committee members. They will be subject to rotation as determined by the Board.
The Board will appoint one of the members as Chairperson of the Committee.
The Committee will manage succession planning for adoption by Export Finance Australia's Board.
Whenever possible, members designate will attend Committee meetings during a transition period prior to the retirement of the member that they will replace.
Any Board member is welcome to attend any Committee meeting.
Participation of non-members
Internal and external auditors and employees of Export Finance Australia may attend and participate (but will not be entitled to vote) at meetings of the Committee.
The Managing Director & CEO and Chief Financial Officer are expected to attend meetings of the Committee, together with such other members of Management as the Committee determines.
The Committee will have a discussion with the external auditors and internal auditors, at least once a year, without members of Management in attendance.
The Committee will be entitled to call upon the expert advice it determines is appropriate to enable the Committee to satisfy its responsibilities and meet its objectives.
The Committee will hold at least three meetings per year, or such greater number as the Chairperson may determine. A member of the Committee may attend a meeting via telephone rather than in person.
At a meeting of the Committee, a quorum consists of 2 members.
The Board Secretary will keep minutes of Committee meetings. The minutes, or relevant extracts from them, will be provided to the internal and external auditors.
Internal Audit - Accountability
The internal auditors are accountable to the Committee.
While day to day issues under the contract with the outsourced internal auditors will be handled by Management, the internal auditors will have direct access to the Committee at any time.
The Committee is the channel to the Board for communication with the external auditors, the ANAO, and any consultants engaged by the ANAO.
Access to the Committee
On any matter within the Committee’s charter, any member of Export Finance Australia’s staff has access to the Chairman of the Committee.
Access to Management
Any access to Export Finance Australia’s staff and business records required by the Committee in order to fulfil its charter will be arranged through the Managing Director & CEO or Chief Financial Officer.
The Chairman of the Committee will provide a report to the Board following each meeting. In addition, the Committee will provide:
- copies of its minutes to the Board;
- a report annually to the Board on the trends/issues that have arisen in the Committee’s work over the previous twelve months; and
- such additional reporting as the Board may require.
Review of Performance
The Committee will review the scope and effectiveness of its activities at least every two years. The review will incorporate the input from relevant stakeholders and the Chairman of the Committee will provide a report to the Board.
Review of Charter
The Committee will review its performance against its Charter annually and will review the Charter at least biennially.