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TERMS OF REFERNECE
- To consider the appointment and re-appointment of the external auditors, the audit fee and terms of engagement, and any questions of resignation or dismissal; to make a recommendation to Council to re-tender the audit engagement when the need arises.
- To discuss with the external auditors before the audit commences, the nature and scope of the audit.
- To review the annual financial statements before submission to the Council, focusing particularly on:
- any changes in accounting policies and practices;
- major judgment areas;
- significant adjustments resulting from the audit;
- the going concern assumptions;
- compliance with accounting standards; and
- compliance with the Professional Accountants Ordinance, Cap 50 and other legal requirements.
- To discuss issues and reservations arising from the management accounts and financial audits, and any matters the auditors may wish to discuss (in the absence of management where necessary).
- To review the external auditors' management letter and management's response.
- To review the Institute's statement on internal control system (where one is included in the annual report) prior to endorsement by the Council.
- To review the internal audit programme, ensure co-ordination between the internal and external auditors, and ensure that the internal audit function is adequately resourced and has appropriate standing within the Institute.
- To approve all non-audit services performed by the external auditors where the cost for those services exceed 10% of the total audit fee.
- To consider the major findings of the internal and external auditors and management's response.
- To consider other topics as defined by Council.
- To perform other related duties as deemed appropriate for the betterment of corporate governance.
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