Charter of the FRC Audit Independence Committee
1. Objective
The objective of the Audit Independence Committee is to assist the Financial Reporting Council (FRC) in the performance of the functions conferred on it under subsection 225(2B) of the Australian Securities and Investments Commission Act 2001 (ASIC Act).
In particular, the Committee will assist the FRC by:
- making recommendations to the FRC concerning the engagement of a person, or persons, to assist the FRC in the performance of the functions conferred on it under subsection 225(2B) of the ASIC Act (‘the consultant’);
- performing, either alone or in conjunction with the consultant, the work and other activities needed to ensure the FRC meets the obligations imposed on it by subsection 225(2B) of the ASIC Act;
- making recommendations to the FRC Chairman concerning the notices that should be given by the Chairman pursuant to section 225A of the ASIC Act; and
- preparing, for the consideration of the FRC, a draft of the report the FRC is required to prepare under section 235BA of the ASIC Act.
2. Composition
The Audit Independence Committee is to be chaired by a member of the FRC and is to include at least two other FRC members. None of the FRC members appointed to the Committee are to be serving partners or employees of an accounting firm. The Chair and other members of the Committee are appointed by majority agreement of the FRC.
The FRC Chairman is a member ex‑officio of the Committee.
A quorum will comprise any two members of the Committee.
As appropriate, the Chair of the Committee may invite other relevant persons (including consultants performing auditor independence work for the FRC) to attend meetings and provide input as necessary.
3. Meetings
The Audit Independence Committee shall meet not less than four times a year and more frequently as circumstances require.
Minutes of meetings of the Committee will be confirmed at the following meeting of the Committee and should ordinarily be included in the papers for the next FRC meeting.
4. Reporting
The key matters discussed at each meeting of the Audit Independence Committee are to be reported by the Chair of the Committee to the FRC at the next FRC meeting. The report should include all matters relevant to the role and responsibilities of the Committee.
5. Other matters
The Audit Independence Committee shall also perform any other activities consistent with this Charter that the Committee or FRC deem appropriate.
6. Review of Charter
The Audit Independence Committee shall undertake an annual review of the Charter. This review should occur at the first meeting held on or after 1 July in each calendar year.