Non-Audit Services Policy. Adopted by the Board on 23 April 2014 OneVue Holdings Limited, ACN

Transcription

1 Non-Audit Services Policy Adopted by the Board on 23 April 2014 OneVue Holdings Limited, ACN

2 Contents Purpose... 3 Non Audit Services... 3 Prohibited specific services... 3 Approval of the provision of other services... 4 Schedule A... 5 Preparing accounting records and financial reports... 5 Valuation services... 5 Taxation Services... 5 Appropriate tax services include:... 5 Design and implementation of financial information technology systems... 6 Design and implementation of internal accounting controls and risk management controls... 6 Corporate finance and similar activities... 7 Assurance and similar services

3 Purpose To maintain the highest standards of corporate governance in relation to auditor independence, this policy sets out whether non-audit services may be provided by the external auditor without impacting their independence in relation to the conduct of the statutory audit. Non Audit Services Non-audit services are defined as any service provided by the External Auditor under engagement with the Company outside the scope of the external audit. The scope of the external audit includes any work required to be performed by the external auditor to form his/her opinion on the financial statements for the Company, other disclosing entities owned by the Company, and subsidiaries or joint ventures requiring audit for the half-year and year-end. The scope will be outlined in the auditors engagement letter and updated in the audit plan presented to the audit and risk committee each year. Prohibited specific services The external auditor should not provide services that have the potential to impair or appear to impair the independence of their audit role. Generally, these include services where the external auditor: participates in activities that are normally undertaken by management is remunerated through a success fee structure acts in advocacy role for OneVue; or where the auditor may be required to audit their own work. The concepts of independence and integrity are more a state of mind and as such are not conducive to prescription by detailed rules. However, the following activities are examples of services that should not be provided by the external auditor: Designing or implementing new IT systems or financial controls; Providing IT systems services; Book-keeping; Valuations, which will then be the subject of the audit firm s opinions Performing executive recruitment or extensive human resources functions; Senior management secondments Success fee based engagements Strategic business direction and planning Acting as a broker-dealer, promoter or underwriter Providing appraisal or valuation and fairness opinions; Performing actuarial services; Performing internal audit services; Providing advice on deal structuring and related documentation; Providing strategic tax planning advice; Legal representation on tax and other legal issues; or 3

4 Providing legal services. Schedule A provides further discussion on non-audit services to assist in the evaluation of independence. Approval of the provision of other services In addition to audit services, the external auditor will be permitted to provide other non-audit services that are not, and are not perceived to be, in conflict with the role of the external auditor, subject to the authorisation process outlined below: by the CEO or CFO for routinely carried out other assurance and audit engagements where the fee for the engagement is less than $100,000; by the Chairman of the Audit Committee for all non-audit services where the proposed fee for the engagement exceeds $100,000; and by the full Audit Committee for all non-audit services where the proposed fee exceeds 50% of the auditor s annual audit fee. A list of all non-audit services provided by the external auditor will be reviewed by the Audit and Risk Committee and then presented to the Board when reviewing the half-year and year-end financial reports. The auditor will provide an independence letter detailing their compliance with their own internal policies on auditor independence in relation to all their dealings with OneVue, as well as compliance with ASIC, ASX and other relevant legislative, regulatory and professional requirements. 4

5 Schedule A Expanded discussion of service areas. Preparing accounting records and financial reports Appropriate services which may be offered by the Auditor include technical assistance, for example on application of accounting standards, principles, disclosures or appropriateness of controls; assisting in the preparation of consolidated financial reports; and proposing adjusting journal entries. For other accounting and bookkeeping services, including payroll processing, the significance of the self-review threat is high and safeguards are required if the service is offered. Accounting or bookkeeping services on financial information that forms the basis of the financial report cannot be undertaken as there is no safeguard that will reduce the threat to an acceptable level (except in two limited situations detailed in Professional Statement F1). In no circumstances must the auditor originate, authorise or approve transactions on behalf of OneVue. Valuation services A self-review threat exists whenever the Auditor provides OneVue with valuation services that result in the preparation of a valuation that is to be incorporated into OneVue s financial report. The significance of the self-review threat is considered too high to allow the provision of service where the valuation relates to amounts that are material in relation to the financial report and where the valuation involves a significant degree of subjective judgement. In these circumstances, which include Independent Expert Reports, the Auditor will not be engaged by OneVue. In all other cases, for example valuations for security holder value strategies and regulatory advice, OneVue may engage and the Auditor may undertake the service after considering whether additional safeguards are needed to mitigate a remaining self-review threat. "Additional safeguards" include using an expert team with different individuals (including engagement partner) and different reporting lines to those of the audit engagement team, or OneVue accepting responsibility for the results of the work. Taxation Services Services relating to taxation are advisory services that may assist OneVue to determine, plan and report on tax consequences related to their activities. As they are advisory services, this work should not usurp OneVue s management function and the provision of such services would not create a threat to independence. However tax services that contain elements of assistance or advice on matters of a strategic tax planning or structuring nature within reorganisations or merger and acquisition transactions should not be undertaken by the Auditor. Appropriate tax services include: Acting as agent of Group companies in the lodgement of income tax returns pursuant to federal, state and local tax legislation. Acting as agent of Group companies in the lodgement of returns relating to any form of indirect or secondary tax, including government royalties, GST, FBT, property and equivalent taxes. Assistance in the preparation of tax returns referred to in the two items immediately above but with no authority for making elections or determining amounts declared therein. 5

6 The provision of advice concerning the filing of tax returns and the handling of specific items in those returns and in connection with responding to queries in relation to those returns from the tax authorities. The provision of independent opinions containing interpretations of taxation legislation as it applies to specific transactions executed or proposed by a Group entities, where those opinions are complementary to the external auditor s examination of the relevant financial statements. The provision of independent opinions containing interpretations of taxation legislation in connection with tax audits, negotiations with or appeals before federal, state, local and foreign tax agencies. Valuation services pertaining exclusively to tax compliance matters. The provision of tax services described provided in connection with acquisition and disposal due diligence activities undertaken by Company management, or in conjunction with assurance services provided by the external auditor on due diligence engagements. The provision of general news and information regarding statutory, regulatory or administrative taxation Design and implementation of financial information technology systems The provision of services by the Auditor to OneVue that involve the design and implementation of financial information technology systems (FITS) used to generate information forming part of the audit client's financial report may give rise to a self-review threat. The significance of the self-review threat is considered too high to permit an auditor to provide such services unless OneVue: acknowledges that they take responsibility for the overall system; appoints a senior employee to take all management decisions with respect to the design and implementation; makes management decisions and evaluates the adequacy and results of the design and implementation; and is responsible for the operation of the system and information generated. The auditor needs to consider whether additional safeguards are required to mitigate a remaining selfreview threat, in particular, whether services should only be provided by an expert team with different individuals (including engagement partner) and different reporting lines to those of the audit engagement team. Design and implementation of internal accounting controls and risk management controls An auditor may undertake a service in connection with advising on the assessment, and design, and operation of internal accounting controls and risk management controls, provided the auditor does not act as an employee, perform internal audit or management functions. Assurance services on internal accounting or risk management, such as data integrity and controls advisory work, are appropriate services for an auditor to provide. 6

7 Corporate finance and similar activities Corporate finance encompasses a range of services. Safeguards that are generally available to counter potential advocacy or self-review threats include: prohibiting the auditor from making managerial decisions on OneVue's behalf using individuals not involved in the audit to undertake the work; and ensuring the auditor does not commit OneVue to a transaction or the terms of a transaction. The auditor is not restricted from bringing M & A deals to the company but it would be understood that the auditor would not be paid on a success basis, would not be permitted to advise on corporate acquisition strategies, assess, or assist in any transaction financial or tax services that may be needed. In general for corporate finance advice and consequent transaction services that may arise OneVue would usually require any such services to be performed by a firm other than the external auditor. Finance Promoting, dealing in, or underwriting OneVue s securities, including for capital raisings, should not be undertaken. This does not include preclude the external auditor from preparing a report as required by the Corporations Act, for example prospectus reporting in the role of investigating accountant or the conduct of financial due diligence on the company s behalf on transactions where the auditor s knowledge of the Company would be advantageous to the conduct of the work. Activities that involve the auditor committing OneVue to the terms of a transaction or agreeing to a transaction are also prohibited. Assurance and similar services Due diligence, forensic and investigative accounting assistance, advice in relation to disaster recovery, and risk assessment advice are services that are appropriate for the Auditor to undertake. These are services that could provide benefits to OneVue as a result of the auditor's experience and knowledge of the business. Assessment or assurance services on environmental, social, or similar reports may also be undertaken by the Auditor. The audit of compliance plans and audits of the financial statements of registered MISs are permissible as they are functions consistent with the external audit role. 7

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