Audit Committee
The Committee consists of three independent Directors. During the year under review, the Committee met at least once every quarter in line with its approved Terms of Reference and consistent with good governance practices.
| Members | Committee member since | Board status |
|---|---|---|
| Philippe Jewtoukoff (Chairperson) | June 2017 | Independent Non- Executive Director |
| Jean Juppin de Fondaumière | February 2019 | Independent Non- Executive Director |
| Mathew Welch | February 2019 | Independent Non- Executive Director |
The duties of the Committee comprise:
General
- Ensure that there is an open avenue of communication between the Head of Internal Audit, the Head of Compliance, the External Auditors and the Board;
- Review annually and, if necessary, propose for formal Board adoption, amendments to the Committee's Terms of Reference;
- Consider, in consultation with the External Auditors and the Head of Internal Audit, the audit plans and scope, ensuring the co-ordination of audit effort is maximized;
- Report to the Directors on the conduct of its responsibilities, with particular reference to the appointment, powers and duties of auditors, as per section 39 of the Banking Act 2004;
- Review the unaudited and/or audited financial statements of the Bank before they are approved by the Board;
- Review the unaudited and/or audited financial statements of AfrAsia Investments Limited (AIL) before they are approved by the Board;
- Review all transactions which could adversely affect the sound financial condition of the Bank as the auditors or any officers of the Bank may bring to the attention of the Committee or as may otherwise come to its attention;
- Ensure that the Bank complies with regulatory requirements; and
- Perform such additional duties as may be assigned to it by the Board.
Financial Statements
- Examine, review and challenge the quality and integrity of the financial statements of the Bank, including External Auditor’s report, annual and half-yearly reports, interim reports and any other formal announcement relating to the organisation’s financial performance;
- Review and report to the Board on significant financial reporting issues and judgements which these financial statements contain, having regards to matters communicated to the Committee by the Auditors;
- Review with management any significant difficulties or disputes encountered during the audit;
- Review other matters related to the conduct of the audit which are to be communicated to the Committee under the Banking Act 2004, the Mauritius Companies Act 2001 and International Financial Reporting Standards;
- Oversee appropriateness of the process, models and the assumptions made for IFRS 9, their impact on financial statements and to satisfy themselves that the dynamic nature of calculating and reporting the Probability of Default and the Expected Credit Loss is maintained, as per the requirements of the Bank of Mauritius; and
- The Audit Committee should try and meet or convene by phone at least one week before the review of the formal review of audited annual financial accounts which are recommended to the Board for approval, so that any important issues which need to be discussed with management and the external auditors are given sufficient time for resolution.
Internal Control
- Enquire from management, the Head of Internal Audit and the external auditors about significant risks or exposures and evaluate the steps taken to minimise such risk to the Bank;
- Consider and review with management and the Head of Internal Audit significant findings during the year and management's responses thereto;
- Require management to implement and maintain appropriate accounting, internal control and financial disclosure procedures and review, evaluate and approve such procedures; and
- Ensure that management is taking appropriate corrective action in response to deficiencies identified by the auditors, including internal control weaknesses and instances of non-compliance with laws and examine and review the contents of the external auditors’ management letter, together with management's responses thereto.
External Audit
- Recommend to the Board, the external auditors to be appointed and their remuneration, review and approve the scope and quality of their work, independence and their discharge or resignation and examine and review any significant changes which have been required in the external auditor's audit plan;
- Consider with management and external auditors the rationale for employing external audit firms for the audit of any subsidiary company other than the principal external auditors;
- Ensure that at least once every five years the external audit services contract is put out to tender to enable the Committee to compare the quality and effectiveness of the services provided by the incumbent external auditor with those of other external audit firms;
- Oversee the selection process of tenders and ensure that all tendering firms have access to information and individuals during the duration of the tendering process. Several firms should be screened and the Committee should obtain written or verbal proposals to enable it to arrive at a recommendation;
- If an external auditor resigns, the Committee shall investigate the underlying issues leading to the resignation and decide whether any action is required;
- Oversee the relationship with the external auditors including (but not limited to):
- Recommendations on their remuneration for non-audit services; Approval of their terms of engagement, including any engagement letter issued at the start of each external audit and the scope of the audit;
- Assess annually their independence and objectivity taking into account relevant professional and regulatory requirements and the relationship with the external auditor as a whole, including the provision of any nonaudit services;
- Satisfy themselves that there are no relationships (such as family, employment, investment, financial or business) between the external auditor and the Bank (other than in the ordinary course of business) which could adversely affect the external auditor’s independence and objectivity;
- Monitor the external auditors’ compliance with relevant ethical and professional guidance on the rotation of external audit partner, the level of fees paid by the Bank compared to the overall fee income of the firm, office and partner and other related requirements;
- Assess annually the qualifications, expertise and resources of the external auditors and the effectiveness of the external audit process, which shall include a report from the external auditors on their own internal quality procedures; and
- Evaluate the risks to the quality and effectiveness of the financial reporting process and consideration of the need to include the risk of withdrawal of the external auditors from the market in that evaluation.
- Meet regularly with the external auditors (including once at the planning stage before the audit and once after the audit at the reporting stage) and at least once a year, without management being present, to discuss the external auditor’s remit and any issues arising from the external audit.
Internal Audit
- Review and approve, where possible in advance of the event, the appointment replacement, reassignment, or dismissal of the Head of Internal Audit;
- Consider and review with management and the Head of Internal Audit:
- Any difficulties encountered in the course of internal audits and any restrictions placed on internal audit scope of work or access to required information or personnel;
- The audit plan of future audits to be conducted;
- The internal auditing department's budget and staffing; and
- Any changes which have been required in the previously approved audit plan.
- Approve the remuneration of the Head of Internal Audit.
Compliance
- Review regular reports from the Head of Compliance and keep under review the adequacy and effectiveness of the Bank’s compliance function; and
- Consider and review the control plans of the Compliance function.