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2012年ACCA《P1专业会计师》备考复习指导25
- Internal Audit Committee (Smith Report) Composition The audit committee is a committee of the board of directors consisting entirely of independent non-executive directors (NEDs) (at least three in larger company), of whom at least one has had recent and relevant financial experience. The role and function of internal audit committee The key roles of the audit committee are ‘oversight’, ‘assessment’ and ‘review’ of other functions and systems in the company. <1> Review of financial statements and budget systems a. Review quarterly/ interim and annual report b. Review financial reporting and budgetary system <2> Liaison with external auditors a. Responsible for appointment and removal of external auditors and fixing their remuneration b. Consider threats to external auditor independence, conflict of interest and suitability of non-audit services c. Liaison with external auditors, internal auditors and financial directors d. Provide information and consultation to external auditors <3> Review of internal audit a. Set standard including objectivity, technical knowledge and professional standard b. Set scope, resource and working plan c. Reporting arrangement and results <4> Review of internal control systems a. Monitor continually the adequacy of internal control system b. Review legal compliance and ethics; ensure obedience of code of conduct <5> Review of risk management a. Formal policy for risk management, update frequently to reflect current position and strategy b. Depend on the work of risk management committee <6> Investigate the risk of fraud and error a. Give specific authority to investigate matters of concern The role of the internal audit committee in internal control <1> System Adequacy: monitor continually the adequacy of internal control systems <2> Legal Compliance: review legal compliance and ethics <3> Investigating Fraud: address the risk of fraud <4> Internal control report: review the company’s statement on internal controls <5> Auditor Recommendation: consider the recommendations of the auditors <6> Supervisory: play a more active supervisory role |
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