TransGrid

Board Audit and Risk Committee Charter

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Primary Function


The Board Audit and Risk Committee is a sub-committee of the Board of Directors.  The rights and duties of a director serving as a member of the Board Audit and Risk Committee are the same as a member of the Board of the Directors. 

 

The primary function of the Board Audit and Risk Committee is to assist the Board in fulfilling its oversight responsibilities by reviewing the:

 

  • overall audit process of the Corporation;
  • systems of internal control which management and the Board of Directors have established;
  • risk management process and determination of the risk appetite for the organisation; 
  • reviewing of the process for monitoring compliance with laws and the Code of Conduct; and
  • financial information, which will be provided to the Board.

 

Committee Structure


The Board Audit and Risk Committee:

 

  • Membership shall consist of at least three non-executive directors. A quorum will be a minimum of two non-executive directors;
  • The preference is that the Board Chairperson not chair the Board Audit and Risk Committee;
  • Shall meet at least four times per year or more frequently as circumstances require;
  • The Managing Director is to be a standing invitee to all meetings unless otherwise indicated;
  • May invite members of management or others to attend meetings;
  • Has the authority of the Board of Directors to obtain all pertinent information from management.

 

Responsibilities


In meeting its obligations the Board Audit and Risk Committee will:

 

  • Provide an open avenue of communication between the internal and external auditors and the Board of Directors;
  • Have the power to authorise investigations into any matter within the Committee’s scope of responsibilities.  The Committee shall be empowered to retain independent counsel, accountants, or others to assist it in the conduct of any investigation;
  • Report regularly to the Board summarising the work performed by the Committee to fully discharge its duties during the year;
  • Meet with the Corporate Audit and Risk Manager and the External Auditor to discuss, independently of Management where necessary, any matters that the Committee or these groups believe should be discussed privately with the Board Audit and Risk Committee;
  • Monitor the standard of corporate conduct to ensure best practice standards are observed;
  • Review and assess the adequacy of the Board Audit and Risk Committee Charter annually, requesting Board approval for proposed changes, and ensure appropriate disclosure as required by law or regulation;
  • Ensure the integrity of the financial information presented to the Board by reviewing management accounts and processes including budget and corporate planning.
  • Confirm annually that all responsibilities outlined in this charter have been carried out; and
  • Evaluate the committee’s and individual members’ performance on a regular basis.


Specific Responsibilities (Audit)

 

In meeting its obligations the Board Audit and Risk Committee will:

 

  • Ensure the independence of the Corporate Audit and Risk Manager;
  • Review the appointment, replacement, reassignment or dismissal of the Corporate Audit and Risk Manager;
  • Approve and review progress of the Risk Management, Audit & Compliance Plan;
  • Enquire of Management and the Corporate Audit and Risk Manager about significant risk or exposures and assess the steps management has taken to minimise such risk to the Corporation;
  • Review with the Corporate Audit and Risk Manager and the External Auditor the coordination of audit effort to assure completeness of coverage, minimise overlapping efforts, and the effective use of audit resources;
  • Consider and review with the Corporate Audit and Risk Manager;
    • The adequacy of the company’s internal controls;
    • Any significant findings and recommendations of the Corporate Audit and Risk Manager together with management’s response thereto;
    • Any difficulties encountered in the course of internal audits, including any restrictions on the scope of work or access to required information;
    • Any changes required in the Audit, Risk Management and Compliance Plan;
    • The performance of the internal audit function;
    • The Corporate Audit and Risk Framework.

 

Specific Responsibilities (Annual Financial Statements)


In meeting its obligations the Board Audit and Risk Committee will:

 

  • Review and agree the External Audit Plan and discuss with the External Auditor their reports including the results of their review of the financial statements;
  • Review with the Managing Director, Chief Financial Officer and the External Auditors:
    • The company’s annual financial statements;
    • The external auditors audit of the financial statements and the report thereon;
    • Any serious difficulties or disagreements with management encountered during the course of the audit;
    • Other matters related to the audit, which are to be communicated to the Committee under generally accepted auditing standards;
    • Ensure the significant accounting policies, which underlie the financial statements, are appropriate.

 

Specific Responsibilities (Compliance)


The Board Audit and Risk Committee will:

 

  • 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 non-compliance;
  • Review the findings of any examinations by regulatory agencies and any auditor observations; 
  • Review the process for communicating the code of conduct to company personnel and for monitoring compliance; and
  • Obtain regular updates from management and company legal counsel regarding compliance matters.

 

Specific Responsibilities (Risk)


The Board Audit and Risk Committee will:

 

  • Review the level of risk appetite for the organisation through the approval of the risk matrix; and
  • Regularly review the strategic risks of the organisation.


 

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