Audit Committee

Terms of Reference of the Audit Committee

In these terms of reference, “University” shall be taken to refer to the whole University group,
or activities, including subsidiaries and joint ventures.

1. Constitution

Council has established a Committee (of Council) known as the Audit Committee.

2. Membership

The Committee (and its chair) are appointed by Council and consists of Independent Members with no executive responsibility for the management of the University. There shall be no fewer than three Members; a quorum shall be at least two Members. The Chair of Council should not be a Member of the Committee and Members should not have significant interests in the University.

The Committee shall consist of at least three Independent Members of Council, and include the Council Dual Assurance Lead for Risk and the Council Dual Assurance Lead for Finance and Investments.

At least one Member should have recent and relevant experience in finance, accounting or auditing and not all members are expected to have the same level of accounting expertise. The Committee may, if it considers it necessary or desirable, coopt members with particular expertise.

3. Attendance at meetings
The Registrar and Secretary, the Chief Financial Officer, the Director of Policy, Planning and Business Intelligence and representatives of the external and internal auditors shall usually attend meetings where business relevant to them is to be discussed. However, at least once a year the Committee will meet with the external and internal auditors without any officers present.
4. Frequency of Meetings
Meetings shall normally be held at least four times each financial year. The external or internal auditors may request a meeting if they consider it necessary.
5. Authority

The Committee is authorised by Council to investigate any activity within its Terms of Reference. It is authorised to seek any information it requires from any employee and all employees are directed to co-operate with any request made by the Committee.

The Committee is authorised by Council to obtain outside legal or other independent professional advice and to secure the attendance of non- members with relevant experience and expertise if it considers this necessary, normally in consultation with the Vice-Chancellor and/or Chair of Council.

The Audit Committee will review the audit aspects of the draft annual financial statements of the University. These aspects will include the external audit opinion, the statement of members’ responsibilities, the statement of internal control and any
relevant issue raised in the external auditors’ management letter (and will include HEFCE’s Accounts Direction). The Committee will, where appropriate, receive advice on the appropriateness of the accounting practices and policies. The Committee will, where appropriate, confirm with the internal and external auditors that the effectiveness of the internal control system has been reviewed, and comment on this in its annual report to Council. Council will review the annual report and the efficacy of Audit Committee.

6. Duties
Effectiveness of Financial Control and Governance
  • To review the effectiveness of financial and other control systems
  • To ensure that all significant losses have been properly investigated and that the nternal and external auditors and HEFCE have been informed, where appropriate.
  • To oversee the University’s policy on fraud and irregularity, including being notified of any action being taken under that policy.
  • To oversee the University’s corporate governance arrangements.
  • To monitor annually, or more frequently if necessary, the implementation of approved recommendations relating to both internal and external audit reports and management letters.
  • To monitor the performance and effectiveness of internal and external audit services, including any matters affecting their objectivity, and make recommendations to Council regarding their reappointment.
  • To promote co-ordination between the internal and external auditors.
  • To monitor the University’s arrangements to promote economy, efficiency and effectiveness (value for money).
7. Risk Management

To keep under review the effectiveness of the risk management, control and governance arrangements in place across the University, including:

(a) The role of the Vice-Chancellor’s Executive Group as the body responsible to Council for the effective management and monitoring of risk (to include the receipt of regular reports on the Group’s consideration of risk);

(b) The Risk Dual Assurance Group, as the body responsible for risk review (including the identification and scoring of risk and ensuring other Dual Assurance groups are aware of the risks impacting on their particular areas of responsibility)

To advise Council on Risk Management by ensuring appropriate audit work in risk
management.

8. Internal Audit
  • To advise Council on the appointment and terms of engagement of the internal audit service, the audit fee, the provision of any non-audit services by the internal auditors and any questions of resignation or dismissal of the internal auditors.
  • To consider and advise Council on the risk based strategic and annual plans for the internal audit service, ensuring the internal audit function on a regular basis addresses the University’s top risks in the risk register where an internal audit is considered to be the best means of receiving assurance on the management of those risks and receiving presentations on controls and mitigation where the risk is not subject to internal audit.
  • The Committee will ensure that the resources made available for internal audit are sufficient to meet the University’s needs (or make a recommendation to Council as appropriate).
  • To consider major findings of internal audit investigations and management’s responses and to advise Council on internal audit reports.
  • To receive an annual report from the internal auditors, which should include an opinion on the degree of assurance that can be placed upon the system of internal control.
9. External Audit
  • To advise Council on the appointment of the external auditors, the scope of their work, the audit fee, the provision of non-audit services by the external auditors and any questions of resignation or dismissal of the external auditors.
  • To discuss with the external auditors, before the audit begins, the nature and scope of the audit.
  • To discuss with the external auditors problems and reservations arising from the interim and final audits, including a review of the management letter, informing management responses and any other matters the external auditors may wish to discuss (in the absence of management where necessary), and to advise Council accordingly.
  • To consider elements of the University’s annual financial statements in the presence of the external auditors, including the auditors’ formal opinion, the statement of members’ responsibilities and the statement of internal control, in accordance with HEFCE’s Accounts Direction.
  • To consider advice from the external auditors on the appropriateness of accounting policies, estimates and adjustments.
  • To monitor the level and activity of any non-audit work commissioned by the University to ensuring that external audit independence is not compromised.
10. Reporting to HEFCE, HESA and other funding bodies

To seek and assess information and evidence from management and auditors on the quality assurance and management of data submitted to HESA, HEFCE and other funding bodies (including the Student Loans Company).

11. Other
  • To receive and review reports, inspections and reviews relating to audit, prepared by the funding councils, the National Audit Office, European Commission and other similar bodies.
  • To receive and review audit reports, inspections and reviews (which may be produced by auditors engaged by other bodies) in respect of Falmouth Exeter Plus and any other subsidiary or joint venture.
  • In the event of the merger or dissolution of the University, to ensure that the necessary actions are completed, including arranging for a final set of financial statements to be completed and signed.
  • To be called upon by Council in specific situations to request assurances as appropriate.
12. Reporting Procedures
The Minutes of meetings of the Audit Committee will be circulated to all Members of Council (attached to agenda papers for Council meetings). The publication of Council minutes will include publication of the minutes of Audit Committee in section II.
  • The Audit Committee will prepare an Annual Report covering the University’s financial year and any significant issues up to the date of preparing the report. The report will be addressed to Council and the Vice-Chancellor, summarising the activity for the year. It will give the Committee’s opinion on the adequacy and effectiveness of the University’s arrangements for the following: -
    • Risk management control and governance (the risk management element includes the accuracy of the statement of internal control included in the annual statement of accounts). o economy, efficiency and effectiveness(value for money)
    • Management and quality assurance of data submitted to HESA, HEFCE and other funding bodies.
  • This opinion should be based upon the information presented to the Committee, taking into account the advice received from the internal and external auditors. The Audit Committee Annual Report should be submitted to Council before the Members’ Responsibility Statement in the Financial Statements is signed.
13. Clerking Arrangements
The Director, Compliance, Governance and Risk will act as Clerk to the Committee.

 

Last Updated September 2017

Membership 2017/18

Chair

Nicholas Bull FCA (2018)

Independent Member of Council

Judy Hargadon OBE (2019)

Independent Member (non-Council)

Nicholas Swift ACT, ACA (2018)

Independent Member of Council

Alison Reed (2019)

Independent Member of Council

Graham Cole CBE (2020)

Independent Member (non-Council)

Simon Enoch (2020)

Independent Member (non-Council)

David Dupont (2020)