17Audit committee for Commonwealth entities

17 Audit committee for Commonwealth entities

Guide to this section

The purpose of this section is to set out minimum requirements relating to the audit committee for a Commonwealth entity to help ensure that the committee provides independent advice and assurance to the entity’s accountable authority. It is also to require the accountable authority to determine the functions the audit committee is to perform for the entity.

This section does not prevent the same audit committee performing functions for multiple Commonwealth entities.

This section is made for subsection 45(2) of the Act.

Functions of the audit committee (1) The accountable authority of a Commonwealth entity must, by written charter, determine the functions of the audit committee for the entity. (2) The functions must include reviewing the appropriateness of the accountable authority’s: (a) financial reporting; and (b) performance reporting; and (c) system of risk oversight and management; and (d) system of internal control; for the entity. Membership of the audit committee (3) The audit committee must consist of at least 3 persons who have appropriate qualifications, knowledge, skills or experience to assist the committee to perform its functions. (4) If the entity is a non‑corporate Commonwealth entity: (a) all of the members of the audit committee must be persons who are not officials of the entity; and (b) a majority of the members must be persons who are not officials of any Commonwealth entity. (4AA) If the entity is a corporate Commonwealth entity, all of the members of the audit committee must be persons who are not employees of the entity. (4A) However, a person employed or engaged primarily for the purpose of being a member of the audit committee is to be treated, for the purpose of subsection (4) or (4AA), as not being an official or employee of the entity. (5) Despite subsections (3) to (4A), the following persons must not be a member of the audit committee: (a) the accountable authority or, if the accountable authority has more than one member, the head (however described) of the accountable authority; (b) the Chief Financial Officer (however described) of the entity; (c) the Chief Executive Officer (however described) of the entity.