Audit and Risk Management Subcommittee
This page outlines the Terms of Reference and membership for the Audit and Risk Management Subcommittee (a subcommittee of the Council Committee).
To assist the Council to discharge its responsibilities for:
- the robustness of the internal control framework and dynamical management and governance practices;
- the integrity and appropriateness of internal and external reporting and accountability arrangements;
- the robustness of risk management systems, process and practices;
- the independence and adequacy of internal and external audit functions;
- compliance with applicable laws, regulations, standards and best practice guidelines; and
- the establishment and maintenance of controls to safeguard the Council's financial and non-financial assets.
Terms of reference
Internal Structures and Reporting
Internal Control Framework
- Management's approach to maintaining an effective internal control framework is sound and effective.
- Management has taken steps to embed a culture that is committed to probity and ethical behaviour.
- There are appropriate processes or systems in place to capture and effectively investigate fraud or material litigation should it be required.
- To consider the processes for ensuring the completeness and quality of financial and operational information being provided to Council including the rigour around financial assumptions and forecasts.
- To seek advice periodically from internal and external auditors regarding the completeness and quality of financial and operational information that is provided to the Council.
- Review whether management has in place a current and comprehensive risk management framework and associated procedures for effective identification and management of the Council's significant risks.
- Consider whether appropriate action is being taken by management to mitigate Council's significant risks.
- Ensure that management is kept appraised of the Council's governance body's views on uncontrolled risk.
- And approve the internal audit coverage and annual work plans, ensuring these plans are based on the Council's risk profile.
- The adequacy of management's implementation of internal audit recommendations.
- The internal audit charter to ensure appropriate organisational structures, authority, access, independence, resourcing and reporting arrangements are in place.
- Conduct a members-only session with internal audit to discuss any matters that the auditors wish to bring to the Subcommittee's attention.
Chief Executive's Performance Review
- The independent member of the Audit and Risk Management Subcommittee will provide an independent review of the process for assessing the Chief Executive's Performance to the Audit and Risk Management Subcommittee. This review will take place once each triennium or upon any change to the process of evaluating the performance system.
External Reporting and Compliance
External Reporting and Accountability
- Consider the appropriateness of the Council's existing accounting policies and principles and any proposed changes.
- Enquire of external auditors for any information that affects the quality and clarity of the Council's financial statements, and assess whether appropriate action has been taken by management.
- Satisfy itself that the financial statements are supported by appropriate management signoff on the statements and on the adequacy of the systems of internal control (i.e. letters of representation), and recommend signing of the financial statements by the Chief Executive/Mayor and adoption by Council.
- Confirm that processes are in place to ensure that financial information included in the entity's annual report is consistent with the signed financial statements.
- Satisfy itself that the Statement of Service Performance is supported by appropriate management signoff on the statement and on the adequacy of the systems of internal management and control.
- Receive and consider the Summary Financial Statements for consistency with the Annual Report.
- Confirm the terms of the appointment and engagement, including the nature and scope of the audit, timetable and fees, with the external auditor.
- Receive the external audit report(s) and review action to be taken by management on significant issues and audit recommendations raised within.
- Conduct a members-only session with external audit to discuss any matters that the auditors wish to bring to the Subcommittee's attention and/or any issues of independence.
Compliance with Legislation, Standards and Best Practice Guidelines
- Review the effectiveness of the system for monitoring the Council's compliance with laws (including governance legislation, regulations and associated government policies), with Council's own standards, and Best Practice Guidelines.
The Audit and Risk Management Subcommittee has delegated authority to carry out activities within its terms of reference
Frequency of meetings
Subcommittee to meet at least quarterly
- Councillor K G Douglas (Chairperson)
- Councillor E G Murrell (Deputy Chairperson)
- Mayor Nick Leggett
- Graeme Mitchell (external member)