Audit Committee Charter

Transcription

1 Audit Cmmittee Charter 5 23.May.17 Mark Fley VP Grup Financial Cntrller Dd Fraser Chairman f the Audit Cmmittee Revisin Revisin Date Dcument Owner Dcument Apprver

2 Revisin: 5 Audit Cmmittee Charter Page 2 f 10 Revisin Revisin Date Sectin AMENDMENTS Descriptin f Amendment 1 10.Feb.11 All New Dcument issued fr use Nv.13 All Dcument slightly updated and refrmatted Jan.14 All Dcument slightly updated and refrmatted Jul May.17 All Membership requirements aligned with the Cmpany s by-laws Dcument updated t reflect changes in Luxemburg law

3 Revisin: 5 Audit Cmmittee Charter Page 3 f 10 TABLE OF CONTENTS 1. INTRODUCTION MEMBERSHIP MEETINGS AUTHORITY DUTIES WITH REGARD TO EXTERNAL AUDIT WITH REGARD TO FINANCIAL DISCLOSURES WITH REGARD TO SUBSEA 7 S INTERNAL AUDIT WITH REGARD TO LEGAL AND COMPLIANCE OTHER RESPONSIBILITIES CHARTER... 8

4 Revisin: 5 Audit Cmmittee Charter Page 4 f INTRODUCTION The Audit Cmmittee is appinted by the Bard f Directrs t assist the Bard f Directrs in (1) verseeing the integrity f the financial statements, (2) cmpliance with legal and regulatry requirements, (3) the independence, qualificatins, perfrmance and cmpensatin f Subsea 7 s external auditrs and (4) the perfrmance f Subsea 7 s Internal Audit functin. 2. MEMBERSHIP The Audit Cmmittee shall cnsist f n fewer than three members. Members f the Audit Cmmittee shall be appinted by the Bard f Directrs n the recmmendatin f the Crprate Gvernance and Nminatin Cmmittee. Audit Cmmittee members may be replaced nly by the Bard f Directrs. The Bard f Directrs may appint nn-executive Directrs as well as persns wh are nt Directrs t the Audit Cmmittee. The Audit Cmmittee shall include at least ne member wh shall have cmpetence in accunting and/r auditing. The members f the Audit Cmmittee as a whle shall have cmpetence relevant t the sectr in which Subsea 7 perates. The majrity f the members f the Audit Cmmittee shall be independent frm Subsea 7. The Chairman f the Audit Cmmittee shall be appinted by the members f the Audit Cmmittee and shall be independent frm Subsea 7. Where all members f the Audit Cmmittee are members f the Bard f Directrs f Subsea 7, the Audit Cmmittee shall be exempted frm the independence requirements prvided fr in the preceding paragraph. 3. MEETINGS The Audit Cmmittee shall meet as ften as it determines in rder t meet its respnsibilities. The qurum fr meetings shall be tw members. Minutes shall be taken f all meetings f the Audit Cmmittee which shall accurately dcument decisins taken and shall be a cnclusive recrd f the meetings. 4. AUTHORITY The rle f the Audit Cmmittee is t prepare matters fr final decisin by the Bard f Directrs as a whle. Material infrmatin that cmes t the attentin f the Audit Cmmittee shuld als be cmmunicated t the ther members f the full Bard f Directrs.

5 Revisin: 5 Audit Cmmittee Charter Page 5 f 10 The Audit Cmmittee shall have the authrity, t the extent it deems necessary r apprpriate, t retain independent legal, accunting r ther advisrs. The Cmpany shall prvide apprpriate funding as determined by the Audit Cmmittee as necessary fr any such advisr r cnsultant. The Audit Cmmittee may frm and delegate authrity t subcmmittees cnsisting f ne r mre members when apprpriate, prvided that decisins f such subcmmittees shall be presented t the full Cmmittee at its next scheduled meeting. The Audit Cmmittee may invite the CEO t attend all r part f its meetings. 5. DUTIES 5.1 WITH REGARD TO EXTERNAL AUDIT The Audit Cmmittee shall: 1. Be respnsible fr the prcedure f selectin and recmmend the appintment f the external auditr t the Bard f Directrs and apprve the fees f the external auditr engaged fr the purpse f preparing r issuing an audit reprt r perfrming ther audit, review r attest services fr Subsea 7 and any questins f resignatin r dismissal f the external auditr; 2. Rtate r retender the external audit engagement when the incumbent external auditr s maximum tenure f 10 years is reached frm the first year f engagement; 3. Ensure that any external audit engagement tendering prcess was cnducted in a fair, transparent and nn-discriminatry manner; 4. Ensure the rtatin f the key external audit partner respnsible fr carrying ut the statutry audit, n later than seven years frm the date f their appintment; 5. Obtain regular updates frm its current auditr n their independence; 6. Oversee the wrk f Subsea 7 s external auditr and apprve the scpe f the audit and ensure c-rdinatin if mre than ne external audit firm is invlved; 7. Oversee the reslutin f any disagreements between management and Subsea 7 s external auditr; 8. Apprve, in advance, all nn-audit services prvided by Subsea 7 s external auditr that are nt prhibited by law and enfrce the ban n the prhibited nn-audit services; 9. Review the external auditr s nn-audit fees n an annual basis and cmply with the plicy set ut in Attachment A in relatin t external auditr s nnaudit services and fees;

6 Revisin: 5 Audit Cmmittee Charter Page 6 f Discuss with the external auditr the matters required t be discussed under applicable auditing standards relating t the cnduct f the audit, including any prblems r difficulties encuntered in the curse f the audit wrk and management s respnse, any restrictins n the scpe f activities r access t requested infrmatin and any significant disagreements with management; 11. Infrm the Bard f Directrs f the utcme f the external audit and the resulting cntributin f the external audit t the integrity f financial reprting and what the rle f the Audit Cmmittee was in that prcess; 12. Obtain regular updates frm its current auditr n its independence; and 13. Set hiring plicies fr emplyees r frmer emplyees f the external auditr. 5.2 WITH REGARD TO FINANCIAL DISCLOSURES The Audit Cmmittee shall: 1. Review the quarterly, half yearly and annual financial disclsures with management and the external auditr befre their apprval by the Bard f Directrs, r the Chairman f the Bard f Directrs, acting n its behalf and submit recmmendatins r prpsals t ensure the financial disclsures integrity. The review will fcus particularly n: all critical accunting plicies and practices; all alternative treatments f financial infrmatin within generally accepted accunting principles, ramificatins f the use f alternative treatments, and the treatment preferred by the external auditr; ther written cmmunicatins between management and the external auditr, such as any management letter r schedule f unadjusted differences; accunting plicies and practices and recmmend any changes t the Bard f Directrs; majr judgement areas; significant adjustments resulting frm the annual audit; cmpliance with all disclsure requirements and duties; cmpliance with accunting standards; cmpliance with legal requirements; disclsure f transactins invlving related parties; and earnings press releases, as well as financial infrmatin and earnings guidance t analysts and rating agencies. 5.3 WITH REGARD TO SUBSEA 7 S INTERNAL AUDIT The Audit Cmmittee shall: 1. Oversee all aspects f the wrk f Subsea 7 s Internal Audit functin. This will include the review and apprval f the scpe f Internal Audit s activities, their annual audit plan, their reprt findings and management respnses resulting frm their wrk; 2. Ensure crdinatin between the internal and external auditr;

7 Revisin: 5 Audit Cmmittee Charter Page 7 f Review with management and Subsea 7 s Internal Audit Directr the activities, staffing, structure and cmpetence f the Internal Audit functin; 4. Review the financial cntrls framewrk n an annual basis; 5. Apprve the budget and staffing f the Internal Audit functin; and 6. Cncur with the appintment and remuneratin f the Internal Audit Directr. 5.4 WITH REGARD TO LEGAL AND COMPLIANCE The Audit Cmmittee shall: 1. Review litigatin invlving claims by sharehlders f wrngding by r against directrs, fficers, r external auditr f Subsea 7; 2. Establish prcedures fr the receipt, retentin and treatment f cmplaints received by Subsea 7 regarding accunting, internal accunting cntrls r auditing matters, and the cnfidential, annymus submissin by emplyees f cncerns regarding questinable accunting r auditing matters; 3. Review n an annual basis the prcedures fr the treatment f cmplaints (whistle blwing htline) unless an exceptinal item arises which requires immediate disclsure t the Audit Cmmittee; and 4. Review the findings f any examinatins by regulatry agencies that may have a significant financial impact.

8 Revisin: 5 Audit Cmmittee Charter Page 8 f OTHER RESPONSIBILITIES The Audit Cmmittee shall: 1. Annually review the Audit Cmmittee's wn perfrmance; 2. Prepare and apprve any required Audit Cmmittee reprt included with Subsea 7 s ntice f the annual meeting; and 3. The Audit Cmmittee shall make regular reprts t the Bard f Directrs regarding its perfrmance f the afrementined duties. 6. CHARTER This Charter may be amended by the Bard f Directrs at any time.

9 Revisin: 5 Audit Cmmittee Charter Page 9 f 10 ATTACHMENT A BASIC PRINCIPLE POLICY FOR AUDITOR NON-AUDIT SERVICES AND FEES Subsea 7 S.A. is cmmitted t ensuring that the financial statements f the Grup, the Cmpany and its subsidiaries have an effective, independent and bjective annual audit by its external auditr. The prvisin f nn-audit services plicy prvides guidance n the types f wrk that it is acceptable fr the external auditr t undertake, and t prvide clarity n the prcess t be fllwed fr apprval. The plicy seeks t define services that the external auditr may nt undertake under any circumstances. Subject t the delegatins set ut belw all nn-audit services prvided by the external auditr are subject t prir apprval by the Audit Cmmittee. Apprval will nly be given n the basis that the service will nt cmprmise independence and/r bjectivity and is either a natural extensin f the audit r there are verriding business r efficiency reasns making the external auditrs mst suited t prvide the services. This plicy will be reviewed n an annual basis by the Audit Cmmittee. EXCLUDED SERVICES Certain services (excluded services) are nt permitted. These are services which have the ptential t impair the external auditr's independence and/r bjectivity typically if they were t result in wrk which wuld be subject t audit by the external auditr. These services include: Tax planning where there is a ptential threat that their bjectivity as the cmpany's auditr culd be affected if the advice invlves a significant degree f judgement and has a material effect n the financial statements Any service f a managerial nature that wuld create systems, prcesses r management judgements n which the financial statements are based r rely. A nnexhaustive list f examples includes: bkkeeping and ther services relating t accunting recrds and crprate financial statements financial infrmatin systems design and implementatin valuatin that has a material effect n the financial statements tax services invlving tax structures r prducts that depend fr their effectiveness n a particular accunting treatment executive recruiting and human resurce services actuarial services management functins including secndments t management psitins that include decisin making management f, r significant invlvement in, internal audit services The Audit Cmmittee Chairman shuld be cnsulted befre any assignment is agreed if there is any dubt whether it wuld fall int ne f these categries.

10 Revisin: 5 Audit Cmmittee Charter Page 10 f 10 APPROVAL POLICY The Audit Cmmittee will apprve in advance annually the fllwing: An annual budget fr tax cmpliance services Delegated authrity t the Chief Financial Officer fr engagements, ther than excluded services, that d nt cumulatively exceed $100,000 within a financial year. All ther services rendered by the external auditr are subject t advance apprval by the Audit Cmmittee. Where the fee fr an individual assignment exceeds the threshld, r where the cumulative spend exceeds $100,000 within a financial year, the Audit Cmmittee needs t apprve the appintment in advance f the wrk cmmencing. Where urgent matters arise, the Audit Cmmittee has delegated its authrity t the Chairman f the Audit Cmmittee between meetings. Such pre-apprval shuld be ratified at the next meeting f the Audit Cmmittee. Irrespective f the financial threshld abve, if there is any dubt as t whether the external auditr have a cnflict f interest, apprval by the Audit Cmmittee is required. REPORTING AND INDEPENDENCE The external auditr will be respnsible fr maintaining detailed recrds f all nn-audit services undertaken and fr ensuring they d nt undertake any excluded services. The external auditr will be respnsible fr advising the Chief Financial Officer if a request fr them t undertake nn-audit wrk will result in the limits set by the Audit Cmmittee being exceeded. The external auditr will prvide the Audit Cmmittee with a breakdwn f all nn-audit services prvided and assciated mnetary amunts at each Audit Cmmittee meeting as a standing agenda item. SUBSEA 7 INTERNAL PROCESS All apprved nn-audit fees fr services prvided by the external auditr must be prcessed using a Purchase Order. In additin the Grup Financial Cntrller shuld be infrmed by f the prpsed fees and need fr the wrk prir t the Purchase Order being raised.