General Synod Financial Advisory Group
MODEL DIOCESAN AUDIT COMMITTEE CHARTER
1. The Audit Committee is a committee appointed by Bishop-in-Council to provide
independent assurance on the appropriateness of a Diocese’s accountability and
control framework, which, over time, is expected to enhance the quality and
consistency of financial information provided to and issued by Bishop-in-Council.
2. The Audit Committee’s role is to review, monitor and, where necessary,
recommend improvements in the following areas of responsibility for the Diocese
as a whole and, as appropriate, diocesan organisations:
i. Compliance with legal requirements and Diocesan policy relating to
ii. The adequacy of internal controls and risk management procedures,
including internal audit
iii. The scope and performance of the External Auditor
iv. Financial reporting to and by the Bishop-in-Council
v. Other matters delegated by Bishop-in-Council from time to time.
3. The Audit Committee is asked to look at the “big picture” of the Diocese in
undertaking its responsibilities, and is encouraged to think strategically.
4. It is recognised that an Audit Committee can be effective only when operating in a
sound environment of financial administration, which inter alia will include a
competent financial officer, an effective Diocesan finance committee and suitably
experienced independent auditors who understand their role. Where this
environment does not exist, the Audit Committee should encourage change
towards best practices.
5. Each member of the Audit Committee should be capable of making a valuable
contribution to the Committee. It is expected that each member will obtain an
understanding of the detailed responsibilities of the Committee and of the
operations and business-related risks of the Diocese and its organisations.
6. The Diocese will provide secretarial support to the Audit Committee, including
when it is drawn from a Provincial panel.
7. It is acknowledged that the existence of an Audit Committee cannot eliminate the
risk of fraud, defalcation or theft.
8. Bishop-in-Council authorises the Audit Committee, within the scope of its
i. Seek any information it requires from:
a. any employee (and all employees are directed to co-operate with
any request made by the Audit Committee); and
b. external parties;
ii. Obtain outside legal or other professional advice, subject to the appropriate
iii. Request the attendance of Diocesan officers at meetings as appropriate.
9. The Audit Committee has no executive powers in relation to the operations of a
Diocese. It functions in an oversight and review role.
10. The primary responsibility for financial and other reporting, internal control and
compliance with legislation, regulations and ethics within a Diocese rests with
11. The Audit Committee is directly accountable to Bishop-in-Council.
12. Members with real or perceived conflicts of interests will notify the Audit
Committee as soon as these issues become apparent. Any member with an actual
or perceived conflict of interest will absent themselves from discussions at the
point of decision.
13. The Audit Committee will comprise no fewer than 3, and up to 5 members, all of
whom will be non-executive members.
14. Bishop-in-Council will appoint the chair of the Audit Committee from time to
time, and will be responsible for the selection and appointment of Audit
15. At least one member will be a member of Bishop-in-Council.
16. None of: the Bishop; Vicar General; Bishop’s Registrar; Diocesan Business
Manager; Diocesan Treasurer; Manager, Internal Audit; nor those in a similar
position in Diocesan organisations will be members of the Audit Committee.
17. At least one member of the Audit Committee will have expertise in or appropriate
experience with financial reporting and auditing.
18. At least one member will have knowledge of the legal framework of the Anglican
Church of Australia, in particular the Diocese and its organisations.
19. A quorum for any meeting will be two-thirds of the members.
20. The Diocese will provide a suitable secretary to the Audit Committee.
Attendance at Meetings
21. The Audit Committee may invite such other persons to its meeting, as it deems
necessary; however, Audit Committee members should not have a substitute
representative attend on their behalf.
22. The Manager, Internal Audit and the External Auditor should be invited to make
presentations to the Audit Committee as necessary.
23. Meetings shall be held not less than 3 times a year. Special meetings may be
convened as required. Internal Audit or the External Auditor may request a
meeting if they consider that it is necessary.
24. The secretary of the Audit Committee shall ensure that an agenda is circulated at
least 3 working days prior to the meeting together with any supporting papers.
The secretary of the Audit Committee will ensure that a record of meetings is
maintained and, after approval of the Chairman of the Audit Committee, is
circulated promptly to members, Bishop-in Council, the External Auditor, Internal
Audit, and relevant Diocesan organisations as appropriate.
ROLES AND RESPONSIBILITIES
The Audit Committee will in regard to:
25. Evaluate whether management is providing the appropriate environment by
communicating the importance of internal control, and management of risk,
including fraud risk, and ensuring that all employees have an understanding of
their roles and responsibilities. This includes the evaluation of controls over the
engagement and conduct of external parties including contractors, advisers and
26. Consider how management assesses the adequacy of internal control processes
and systems and plans for business continuity and actively participate in the
assessment process from an independent perspective.
27. Follow-up whether internal control recommendations made by Internal Audit and
the External Auditor have been implemented by management.
28. Satisfy itself, in consultation with Internal Audit and the External Auditor, that
management is effectively managing the current areas of greatest financial and
29. Consider referring to Internal Audit and the External Auditor any fraud, illegal
acts, deficiencies in internal control or other similar issues.
30. Review significant accounting and reporting issues, including recent professional
and regulatory pronouncements, and understand their impact on the financial
31. Review any legal matters that could significantly impact the financial statements.
Annual Financial Statements
32. Review the annual financial statements and determine whether they are complete
and consistent with the information known to Audit Committee members; assess
whether the financial statements reflect appropriate accounting principles, and the
disclosure of appropriate financial performance measures.
33. Pay particular attention to complex and/or unusual transactions
34. Focus on judgmental areas, for example those involving valuation of assets and
liabilities; guarantees; environmental liabilities; litigation reserves; and other
commitments and contingencies.
35. Meet with management and the External Auditor to review the financial
statements and the results of the audit.
36. Review the annual report before its release and consider whether the information
is reasonably consistent with the Audit Committee’s knowledge about the Diocese
and its operations.
Internal Audit (if any)
37. Review and endorse the plans, activities and organisational structure of the
Internal Audit function and ensure no unjustified restrictions or limitations are
38. Review the qualifications of Internal Audit personnel and concur with the
appointment, replacement, reassignment or dismissal of the Internal Audit
39. Review and endorse the performance agreement of the Internal Audit Manager
40. Review the effectiveness of the Internal Audit function and provide feedback on
the performance of the Internal Audit Manager, both to the Internal Audit
Manager and to Bishop-in-Council.
41. Meet separately with the Internal Audit Manager to discuss any matters that the
Audit Committee or Internal Audit believes should be discussed privately.
42. Ensure that significant findings and recommendations made by Internal Audit are
received and discussed by the Audit Committee on a timely basis.
43. Ensure that management responds to recommendations by Internal Audit.
44. Review the External Auditor’s proposed audit scope and approach and ensure no
unjustified restrictions or limitations have been placed on the scope.
45. Review the performance of the External Auditor in its dealings with the Diocese.
46. Monitor the independence of the External Auditor, including the review and
approval in advance of any non-audit services to be contracted by the Diocese
from the External Auditor.
47. Make recommendations to Bishop-in-Council regarding the appointment and
reappointment of the External Auditor.
48. Meet separately with the External Auditor to discuss any matters that the Audit
Committee or auditors believe should be discussed privately.
49. Ensure that significant findings and recommendations made by the External
Auditor are received and discussed on a timely basis.
50. Ensure that management responds to recommendations made by the External
Compliance with Legislation and Regulations
51. Review the effectiveness of the system for monitoring compliance with legislation
and regulations and the results of management’s investigation and follow-up
(including disciplinary action) of any fraudulent acts or non-compliance.
52. Obtain regular updates from management, with legal advice as necessary,
regarding compliance matters.
53. Be satisfied that all regulatory compliance matters have been considered in the
preparation of the financial statements and annual report.
54. Regularly report to the Bishop-in-Council on Audit Committee activities and
make appropriate recommendations.
55. Ensure that Bishop-in-Council is aware of matters that may significantly impact
the financial condition or affairs of the Diocese.
56. Provide an open avenue of communication between Bishop-in-Council, Diocesan
senior executive staff, Internal Audit, and the External Auditor (including through,
but not limited to, regular de-briefs of Audit Committee activity with the Bishop,
occasional presentations by the Audit Committee to Bishop-in-Council, and a
standing invitation to the External Auditor to attend Audit Committee meetings).
57. Evaluate the Audit Committee’s own performance on a regular basis and report to
Bishop-in-Council at least annually on the Audit Committee’s achievements
against its proposed outcomes.