Audit and Risk Management Committee Charter

Transcription

1 Audit and Risk Management Cmmittee Charter Pivtal Systems Crpratin ("Cmpany") 1. Objectives The Audit and Risk Management Cmmittee (Cmmittee) has been established by the bard f directrs (Bard) f the Cmpany. The bjectives f the Cmmittee are t: assist the Bard in discharging its respnsibilities relative t the financial reprting prcess, the system f internal cntrl relating t all matters affecting the Cmpany's financial perfrmance and the audit prcess; assist the Bard in mnitring cmpliance with laws and regulatins and the Cmpany's Cde f Cnduct; assist the Bard t adpt and apply apprpriate ethical standards in relatin t the management f the Cmpany and the cnduct f its business; implement, review and supervise the Cmpany's risk management framewrk; and review the adequacy f the Cmpany's insurance plicies. 2. Authrity The Cmmittee has authrity t cnduct r authrise investigatins int any matters within its scpe f respnsibility. It is authrised t: retain utside cunsel, accuntants r ther experts, at the expense f the Cmpany, t advise the Cmmittee r assist in the cnduct f any matter; seek any infrmatin it requires frm emplyees (all f whm are directed t cperate with the Cmmittee's requests) r external parties; and meet with Cmpany fficers, emplyees, external auditr, internal auditr (if any) r utside cunsel, as necessary and withut management present. The Cmmittee will make recmmendatins t the Bard n all matters requiring a decisin frm the Bard. The Cmmittee des nt have the pwer r authrity t make a decisin in the Bard's name r n its behalf. 3. Membership Members f the Cmmittee shall cmprise members f the Bard appinted by the Bard. The number f members f the Cmmittee shall be a minimum f three directrs, all f whm shall, where practicable, be nn-executive directrs and, a majrity f whm shuld be independent directrs. As at the date f this Charter, the Cmmittee des nt cmprise f a majrity f independent directrs. All members f the Cmmittee shall be financially literate and have a sufficient understanding f the industry in which the Cmpany perates. At least ne member shall have an adequate accunting r financial backgrund (that is, [ : _1] page 1

2 shuld be a qualified accuntant r ther finance prfessinal with experience f financial and accunting matters). The Bard will nminate the Chair f the Cmmittee frm time t time. The Cmmittee Chair will be, where practicable, an independent directr wh is nt Chair f the Bard. 4. Cmmittee Meetings Meetings shall be held as required but nt less than fur times a year having regard t the Cmpany's reprting and audit cycle. Any member f the Cmmittee may request a meeting at any time if they cnsider it necessary. A qurum f the Cmmittee will cmprise a majrity f the members, ne f which must be the Cmmittee Chair. Hwever, all members f the Cmmittee are expected t attend and participate in Cmmittee meetings. Nn-Cmmittee members may be invited by the Cmmittee Chair t attend meetings f the Cmmittee. Meetings f the Cmmittee may be held r participated in by cnference call r similar means, and decisins may be made by circular r written reslutin. Each member f the Cmmittee will have ne vte. If there is a tied vte, the mtin will lapse. Fllwing each meeting, the Cmmittee Chair will reprt t the Bard n any matter that shuld be brught t the Bard's attentin and n any recmmendatin f the Cmmittee that requires Bard apprval r actin, and prvide the Bard with sufficient infrmatin upn which t make a decisin in that regard. Minutes f meetings f the Cmmittee will be prepared fr apprval by the Cmmittee and be circulated t the members f the Bard. The Cmpany Secretary will prvide such assistance as may be required by the Cmmittee Chair including in relatin t preparatin f the agenda, minutes r papers fr the Cmmittee. 5. Respnsibilities The respnsibilities f the Cmmittee are as fllws: Financial statements review the quarterly, half-yearly and yearly financial statements and cnsider whether they are cmplete, cnsistent with infrmatin knwn t the Cmmittee, reflect apprpriate accunting plicies and principles and therwise prvide a true and fair view f the financial psitin and perfrmance f the Cmpany; receive and cnsider, in cnnectin with the Cmpany's quarterly, half-yearly and yearly financial statements, letters f representatin t the Bard in respect f financial reprting and the adequacy and effectiveness f the Cmpany's risk management, internal cmpliance and cntrl systems and the prcess and evidence adpted t satisfy thse cnclusins; [ : _1] page 2

3 review the financial sectins f the Cmpany's Annual Reprt and related regulatry filings befre release and cnsider the accuracy and cmpleteness f the infrmatin; review with management and the external auditrs the results f the audit; receive frm the Cmpany Chief Executive Officer and Chief Financial Officer a declaratin that, in their pinin, the financial recrds f the Cmpany have been prperly maintained and that the financial statements cmply with accunting standards and give a true and fair view f the financial psitin and perfrmance f the Cmpany and that the pinin has been frmed n the basis f a sund system f risk management and internal cntrl which is perating effectively, befre the Bard apprves the half-yearly and yearly financial statements; Internal cntrl mnitring f crprate risk assessment and the internal cntrls instituted in accrdance with the Cmpany's Risk Management Plicy; review the effectiveness f the Cmpany's internal cntrls regarding all matters affecting the Cmpany's financial perfrmance and financial reprting, including infrmatin technlgy security and cntrl; review the scpe f internal (if ne is appinted) and external auditrs' review f internal cntrl, review reprts n significant findings and recmmendatins, tgether with management's respnses, and recmmend changes frm time t time as apprpriate; review n an nging basis, the Cmpany s need t establish an internal audit functin and appint an internal auditr, as the business grws; External audit establish prcedures fr the selectin, appintment and remval f the external auditr and fr the rtatin f external audit engagement partners; review the external auditrs' prpsed audit scpe and apprach; meet with the external auditr t review reprts, and meet separately, at least nce a year, t discuss in that regard any matters that the Cmmittee r auditrs believe shuld be discussed privately; establish plicies as apprpriate in regards t the independence, integrity and perfrmance f the external auditr; review f the independence f the external auditrs and the apprpriateness f any services prvided by them t the Cmpany (if any), utside their statutry rle; fr the purpse f remving r appinting external auditrs review their perfrmance, including their prpsed fees, and if apprpriate cnduct a tender f the audit. Any subsequent recmmendatin fllwing the tender fr the appintment f an external auditr will be put t the Bard and if a change is apprved it will then be put frward t sharehlders fr their apprval; review any prpsal fr the external auditr t prvide nn-audit services and cnsider whether it might cmprmise the independence f the external auditr; [ : _1] page 3

4 Cmpliance cnsider the wrkplan fr Cmpany cmpliance activities; btain regular updates frm management regarding cmpliance matters; review the effectiveness f the system fr mnitring cmpliance with laws and regulatins and the results f management's investigatin and fllw-up (including disciplinary actin) f any instances f nn-cmpliance; review and assess the management prcess supprting external reprting; review the findings f any examinatins by regulatry agencies and authrities; review the prcess fr cmmunicating the Cde f Cnduct t Cmpany persnnel, and fr mnitring cmpliance with that Cde; Risk management cnsider the verall risk management framewrk and annually review its effectiveness in meeting sund crprate gvernance principles and keep the Bard infrmed f all significant business risks; review with management the adequacy f the Cmpany's systems fr identifying, managing, and mnitring the key risks t the Cmpany in accrdance with the Cmpany's Risk Management Plicy; btain reprts frm management n the status f any key risk expsures r incidents; review the adequacy f the Cmpany's prcess fr managing risk and prvide a recmmendatin t the Bard regarding the same in accrdance with the Cmpany's Risk Management Plicy; review any incident invlving fraud r ther break dwn f the Cmpany's internal cntrls in accrdance with the Cmpany's Risk Management Plicy; review any incident invlving any break dwn f the Cmpany's risk management framewrk in accrdance with the Cmpany's Risk Management Plicy; review the Cmpany's insurance prgram having regard t the Cmpany's business and the insurable risks assciated with its business and infrm the Bard regarding the same; review whether the Cmpany has any material expsure t any ecnmic, envirnmental and scial sustainability risks and if s, develp strategies t manage such risks t present t the Bard; Reprting respnsibilities regularly reprt t the Bard abut Cmmittee activities, issues, and related recmmendatins. Such reprt shuld include the results f the Cmmittee's: assessment f whether external reprting is cnsistent with Cmmittee members' infrmatin and knwledge and is adequate fr the needs f the Cmpany's sharehlders; [ : _1] page 4

5 assessment f the management prcesses which supprts external reprting; assessment f the Cmpany's crprate reprting prcesses; assessment f the apprpriateness f the accunting chices made by management in preparing the Cmpany's financial statements; prcedures fr the selectin and appintment f the Cmpany's external auditr and fr the rtatin f external audit engagement partners; recmmendatins fr the appintment r, if necessary, the remval f the external auditr; assessment f the perfrmance and independence f the Cmpany's external auditr. Where the external auditr prvides nn-audit services, the reprt shuld als state whether the Cmmittee is satisfied that prvisin f thse services has nt cmprmised the auditr's independence; assessment f the perfrmance and bjectivity f the Cmpany's internal audit functin (if ne is appinted); review f the Cmpany's risk management and internal cntrl systems; and recmmendatins fr the appintment, r if necessary, the dismissal f the head f internal audit (if ne is appinted); prvide an pen avenue f cmmunicatin between internal audit (if ne is appinted), the external auditrs and the Bard. Fr the purpse f supprting the independence f their functin, the external auditr and the internal auditr (if ne is appinted) will have a direct line f reprting access t the Cmmittee; reprt annually t the Cmpany's sharehlders, describing the Cmmittee's cmpsitin, respnsibilities and hw they were discharged and any ther infrmatin required by law r the ASX Listing Rules ; review any ther reprts the Cmpany issues that relate t Cmmittee respnsibilities; Related party transactins review and mnitr related party transactins and investments invlving the Cmpany and its directrs including maintaining a register f related party cntracts which is reviewed at least annually; review the adequacy f the Cmpany's and its subsidiaries (if any) insurance plicies; review and apprve all transactins in which the Cmpany is a participant, and in which any parties related t the Cmpany (including its executive fficers, Directrs, beneficial wners f mre than 5% (substantial hlding) f the Cmpany's shares, immediate family members f the freging persns and any ther persns whm the Bard determines may be cnsidered related parties f the Cmpany) has r will have a direct r indirect material interest; [ : _1] page 5

6 the Cmmittee shuld nly apprve thse related party transactins that are determined t be in, r are nt incnsistent with, the best interests f the Cmpany and its sharehlders, after taking int accunt all available facts and circumstances as the Cmmittee r the Chair f the Cmpany determines in gd faith t be necessary. Transactins with related parties r sharehlders hlding a relevant interest in at least 10% f the Cmpany's shares may als be subject t sharehlder apprval t the extent required by the ASX Listing Rules; Other respnsibilities review the adequacy f external reprting by the Cmpany t meet the needs f sharehlders; perfrm ther activities related t this Charter as requested by the Bard; institute and versee special investigatins as needed; cnfirm annually that all respnsibilities utlined in this Charter have been carried ut; evaluate the Cmmittee's and individual members' perfrmance n a regular basis; and review and apprve an annual summary reprt f the CEO s travel and entertainment expenses. 6. Review f the Cmmittee The Cmmittee will prepare and prvide t the Bard annually: a self-evaluatin f its perfrmance against this Charter; recmmended gals and bjectives fr the cming year; and recmmended changes r imprvements t this Charter if necessary. The Cmmittee, in rder t ensure that it is fulfilling its duties t the Cmpany and its sharehlders, will peridically: btain feedback frm the Bard n the Cmmittee's perfrmance and implement any agreed actins; and prvide any infrmatin the Bard may request t facilitate its review f the Cmmittee's perfrmance. The Bard shall review the perfrmance f the Cmmittee, at least nce per year. 7. Reprting Prcedures The Cmmittee shall maintain direct lines f cmmunicatin with the external auditrs, the Chief Executive Officer, the Chief Financial Officer, the internal auditrs (if appinted) and with management generally including thse respnsible fr nn-financial risk management. [ : _1] page 6

7 The Chief Executive Officer and the Chief Financial Officer shall be respnsible fr drawing t the Cmmittee's immediate attentin any material matter that relates t the financial cnditin f the Cmpany, any material breakdwn in internal cntrls, and any material event f fraud r malpractice. The Cmmittee shall be prvided with cpies f all letters between the external auditrs and management. After each meeting, the Chair will reprt the Cmmittee's recmmendatins and findings t the Bard. The Chair will present an annual reprt t the Bard summarising the Cmmittee's activities during the year and any related significant results and findings. 8. Revisins t this Charter The Cmmittee is respnsible fr reviewing the effectiveness f this Charter and the peratins f the Cmmittee. The Cmmittee may recmmend t the Bard any changes r imprvements t this Charter. Any amendments t this Charter must be apprved by the Bard. [ : _1] page 7