BRISBANE BRONCOS LIMITED AUDIT AND RISK MANAGEMENT CHARTER

Transcription

1 ORGANISATION This charter governs the operations of the Audit and Risk Management Committee. The Committee shall review and reassess the charter at least annually and obtain the approval of the Board of Directors. COMPOSITION The Committee shall be members of, and appointed by, the Board of Directors and shall comprise of at least three Directors that have diverse, complementary backgrounds, a majority of which are independent of management and the Company. In addition, the Committee Chair shall have an adequate finance, accounting and/or business background. All Committee members shall be financially literate. At least one member shall have accounting and/or related financial management expertise as determined by the Board of Directors. Members of the Committee shall be considered independent so long as they do not have any relationship with the Company that may interfere with the exercise of independent judgement. They shall not accept any consulting, advisory, or other compensatory fee from the Company, and are not an affiliated person of the Company or its related entities. The only compensation shall be Directors fees for services provided to the Board and Committees. MEETINGS The Committee shall meet at least 2 times each year, or more frequently as circumstances dictate. The Chairman of the Audit and Risk Management Committee, in consultation with other Committee members, shall determine the frequency and length of the Committee meetings and shall set meeting agendas consistent with this Charter. A majority of members shall constitute a quorum. The main purpose of these meetings shall be to: Review and approve external audit plans. Review and approve the half-year financial report. Review and approve the annual financial report. Minutes of each meeting are to be prepared, and following approval of the Audit and Risk Management Committee, sent to the Board of Directors. PURPOSE The Audit and Risk Management Committee shall assist the Board of Directors in its oversight of (i) the integrity of the Group s financial statements and the Group s financial reporting processes and systems of internal control and risk management, (ii) the qualifications, independence and performance of the Group s auditors and the performance of the Group s corporate auditors and corporate audit function and (iii) the Group s compliance with legal and regulatory requirements, and shall provide an avenue of communication among management, the auditors, the corporate auditors, and the Board of Directors. The Audit and Risk Management Committee shall have full access to all books, records, facilities and personnel of the Group, and shall be authorised (without seeking approval of the Board of Directors) to retain special legal, accounting or other advisors and to request any officer or employee of the Group or auditors to meet with any members of, or advisors to the Audit and Risk Management Committee.

2 Limitations Inherent in the Audit and Risk Management Committee s Role While the Audit and Risk Management Committee has the responsibility and powers set forth in this charter, it is not the duty of the Audit and Risk Management Committee to determine that the Group s financial statements are complete and accurate and are in accordance with the appropriate regulations. This determination is the responsibility of management and the auditors. Nor is it the duty of the Audit and Risk Management Committee to assure compliance with the Group s Code of Conduct. Furthermore, while the Audit and Risk Management Committee is responsible for reviewing the Group s policies and practices with respect to risk assessment and management, it is the responsibility of the Chief Executive and senior management to determine the appropriate level of the Group s exposure to risk. DUTIES AND RESPONSIBILITIES Understanding the Business The Committee shall ensure it understands the Company s structure, controls, and types of transactions in order to adequately assess the significant risks faced by the company in the current environment. Appointment of Auditors The Audit and Risk Management Committee shall be directly responsible for making recommendations to the Board of Directors on the appointment, reappointment or replacement (subject, if applicable, to shareholder ratification), remuneration, monitoring of the effectiveness, and independence of the external auditors, including resolution of disagreements between management and the auditor regarding financial reporting. The Committee shall pre-approve all audit and non-audit services provided by the external auditors and shall not engage the external auditors to perform any non-audit/assurance services that may impair or appear to impair the external auditor's judgment or independence in respect of the Company. The Committee may delegate pre-approval authority to a member of the Audit and Risk Management Committee. The decisions of any Audit and Risk Management Committee member to whom pre-approval authority is delegated must be presented to the full Audit and Risk Management Committee at its next scheduled meeting. Assessment of the Auditors The Committee should evaluate the auditor s qualifications, performance and independence, and present its conclusions and recommendations with respect to the auditors to the Board of Directors on at least an annual basis. The auditors are ultimately accountable to the Board of Directors and the Audit and Risk Management Committee. As part of such evaluation, at least annually, the Audit and Risk Management Committee shall: Obtain and review a report from the Group s auditors describing (or meet, discuss and document the following with them): The audit firm's internal quality control procedures. Any material issues raised by the most recent internal quality control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues.

3 All relationships between the auditor and the Company (to assess the auditor's independence). The Audit and Risk Management Committee shall obtain the opinions of management of the auditors performance. Independence of the Auditors The Committee shall review and assess the independence of the external auditor, including but not limited to any relationships with the Company or any other entity that may impair or appear to impair the external auditor's judgment or independence in respect of the Company. The Committee shall evaluate and review the lead partner (and senior members) of the auditors. In addition to assuring regular rotation of the lead audit partner as required by law, the Committee shall consider whether the auditors should be rotated, so as to assure continuing auditor independence. Scope of the External Audit The Committee shall discuss with the auditors the overall scope of the external audit, including identified risk areas and any additional agreed-upon procedures. In addition, the Committee shall also review the auditors compensation to ensure that an effective, comprehensive and complete audit can be conducted for the agreed compensation level. Financial Reporting The primary responsibility of the Audit and Risk Management Committee is to oversee the Company s financial reporting process on behalf of the Board and report the results of its activities to the Board. The Board of Directors is responsible for the Company s financial reports including the appropriateness of the accounting policies and principles that are used by the Company. The external auditors are responsible for auditing the Company s financial reports and reviewing the company s unaudited interim financial reports. The Committee, in carrying out its responsibilities, believes its policies and procedures should remain flexible, in order to best react to changing conditions and circumstances. The Committee will take appropriate actions to set the overall corporate 'tone' for quality financial reporting, sound business risk practices, and ethical behaviour. Assessment of Accounting, Financial and Internal Controls It is the responsibility of the Audit and Risk Management Committee to: Review and discuss with the auditors and management the results of the annual audit of the Group s consolidated financial statements. Review and discuss with the auditor any audit problems or difficulties encountered during the course of the audit, and management's response thereto, including those matters required to be discussed with the Audit and Risk Management Committee by the auditors pursuant to the applicable Australian Auditing Standards.

4 Recommend to the Board of Directors whether the Group s consolidated financial statements be accepted for inclusion in the Group s Annual Report filed with the ASX. Review and discuss with management and the auditors the Group s half year financial statements and any items requiring communication to the Committee by the auditors in according with existing auditing standards. Review all representation letters signed by management to ensure that the information provided is complete and appropriate. Review (in consultation with management and the auditors) the integrity of the Group s financial reporting process, internal controls and procedures, including whether there are significant deficiencies in the design or material weaknesses in such processes, controls and procedures, any corrective actions taken with regard to such deficiencies and any fraud involving management or other employees with a significant role in such processes, controls and procedures. Review the Group s policies and practices with respect to risk assessment and management, including discussing with management the Group s major financial risk exposures and the steps that have been taken to monitor and control such exposures. Review with management and the auditors in separate meetings, if the Audit and Risk Management Committee deems appropriate: (i) any analysis or communication by management or the auditors detailing significant financial reporting issues, (ii) the critical accounting policies of the Group, (iii) any major issues regarding accounting principles and financial statement presentations, (iv) related party transactions and offbalance sheet transactions and structures; (v) the quality and acceptability of the Group s accounting policies. Receive regular reports from the auditor on the critical policies and practices of the Company, and all alternative treatments of financial information within generally accepted accounting principles that have been discussed with management. Review with management any legal or regulatory matter that could have significant impact on the Group s financial statements. Consider and approve if appropriate, major changes to the Group s auditing and accounting principles and practices suggested by the auditors or management. Establish procedures for the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters, and the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters. Review with the auditors and management the extent to which changes or improvements in financial or accounting practices, as approved by the Audit and Risk Management Committee, have been implemented.

5 Communication with the Board of Directors The Audit and Risk Management Committee will report to the Board on a regular basis. This will include information on any issues that arise with respect to the quality and integrity of the financial statements, the legal and regulatory requirements and the qualifications, independence and performance of the auditors. Communications with Shareholders The Committee shall review and discuss ASX press releases, as well as financial information and earnings guidance provided to analysts and rating agencies if applicable. The Committee shall review the half-year financial report and Appendix 4B/new Appendix 4D prior to the filing of these with the ASX. Committee Performance The Committee shall perform an evaluation of its performance annually to determine whether it is functioning effectively by reference to current best practice.