A public or state-owned company must have an audit committee consisting of at least three members, unless it is a subsidiary of another company with an audit committee that will perform the functions of the audit committee of the subsidiary. The audit committee members must be appointed upon incorporation by the incorporators or within 40 business days after incorporation by the board of directors. Thereafter, the audit committee must be elected at each annual general meeting.

Audit committee members must be directors of the company, meeting the requirements set out in regulations published by the Minister.  The audit committee members must be non-executive and independent. Audit committee vacancies must be filled within 40 business days.

The audit committee of a company is responsible for the following:

  • Nominating independent auditors for the company;
  • Determining the fees to be paid to the auditors and their terms of engagement;
    Ensuring compliance with the Companies Act and other relevant legislation in the appointment of auditors;
  • Determining the nature and extent of non-audit services that the auditor may provide to the company;
  • Preparing a report for inclusion in the financial statements
    • describing how the audit committee carried out its functions,
    • commenting on the financial statements, accounting practices and internal financial controls of the company
    • stating whether the audit committee is satisfied by the independence of the auditor
  • Receiving and disposing of concerns and complaints relating to
    • Accounting practices and internal audit of the company;
    • The content and auditing of the company’s financial statements
    • The internal financial controls of the company;
    • Any related matter;
  • Making submissions to the board on any matter concerning the company’s accounting policies, financial control, records and reporting.
  • Performing other functions determined by the board, including the development and implementation of a policy and plan for a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes within the company.