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MEET & LIVESTOCK AUSTRALIA LIMITED

By Amber Stephens,2014-05-17 02:33
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MEET & LIVESTOCK AUSTRALIA LIMITED

    MEAT & LIVESTOCK AUSTRALIA

    LIMITED

    AUDIT COMMITTEE CHARTER

ORGANISATION

    This charter governs the operations of the Audit Committee. The Committee should

    review and assess the charter periodically and, where changes are recommended, obtain

    the approval of the Board of Directors.

ROLE

    The Audit Committee shall provide assistance to the Board of Directors in fulfilling its corporate governance and oversight responsibility in relation to the Company’s financial

    reporting, internal control structure, risk management and the internal and external audit

    functions. In doing so, it is the Audit Committee’s responsibility to maintain free and

    open communication with the external auditors, internal auditors and management of the

    Company.

The Audit Committee is empowered to investigate any matter, with full access to all

    books, records, company operations and personnel of the Company and has the authority

    to engage independent counsel and other advisors as it determines necessary to carry out

    its duties.

MEMBERSHIP

    The Audit Committee shall be members of, and appointed by, the Board of Directors and

    shall comprise at least three Directors who are independent of management. All

    Committee members shall be financially literate. One member, who does not chair the

    Board, shall be appointed to chair the Committee. At least one member shall have

    accounting and/ or related financial management expertise as determined by the Board of

    Directors.

Members of the Committee shall be considered to be independent as long as they do not

    have a relationship with the Company that will interfere with the exercise of independent

    judgment.

MEETINGS

    The Audit Committee shall meet at least three times per year, or more frequently should

    circumstances require. As part of the three scheduled meetings (either before or after the

    meetings, as convenient) the Committee is to meet in separate sessions with each of the

    external auditor, the internal auditor (see Internal audit and communication, below) and

    senior financial management.

The Managing Director, the General Manager-Corporate Services, the internal auditor

    and the partner in charge of the external audit will be routinely invited to attend the

    meetings of the Committee unless the Chair of the Committee decides otherwise. Other senior managers may be asked to attend when the Committee is reviewing specific

    agenda items.

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Committee papers are available, on request, to all MLA Board members. At the next full

    Board meeting, the Chair of the Audit Committee reports to the Board on matters

    addressed by the Committee and minutes of Committee meetings are included in the

    papers for the following Board meeting. There is an open invitation to all other non-

    executive Board members to attend Audit Committee meetings.

DUTIES & RESPONSIBILITIES

    Understand the business

    The Committee shall ensure it understands the Company’s structure, controls and types

    of transactions in order to adequately assess the significant risks faced by the Company in

    the current environment.

Financial reporting

    After reviewing with management and the external auditors, the Committee will

    recommend to the Board for approval:

    ? annual financial statements;

    ? the external auditor’s report on the annual financial statements;

    ? the external auditor’s report on the Company’s compliance with the

    Commonwealth Deed of Agreement.

The Committee shall review all representation letters signed by management to ensure all

    relevant matters are addressed. The Committee shall discuss the results of the annual

    audit and any other matters to be communicated to the Committee by the external auditor

    under generally accepted auditing standards.

The Committee will assess the impact of changes in accounting standards and review

    recommendations for adoption of such changes in the accounts.

Internal controls and risk management

    The Committee shall discuss with management, the internal auditors and the external

    auditors the adequacy and effectiveness of accounting and financial controls, including

    the Company’s policies and procedures to assess, monitor and manage business risk and legal and ethical compliance programs (including the Company’s Code of Commercial

    Conduct). Any opinion obtained from the internal or external auditors on the Company’s choice of accounting policies or methods should include their views on the

    appropriateness and not just the acceptability of that choice or method.

The Audit Committee shall periodically meet separately with management, the internal

    auditors and the external auditors to discuss issues and concerns warranting Committee

    attention, including but not limited to their assessments of the adequacy of internal

    control and the process for improvement. The Committee shall review with the external

    auditor any audit problems or difficulties and management’s response.

The Committee shall receive regular reports from the external auditor on critical policies

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and practices of the Company and all alternative treatments of financial information

    within generally accepted accounting principles discussed with management.

Without limiting the general applicability of the foregoing, the Committee’s assessment

    of internal controls shall include, on a periodical basis, the consideration of:

    ? policies in relation to management’s expense accounts;

    ? polices in relation to the Board’s Delegation of Authority to management;

    ? policies in relation to cheque signatory authorisation;

    ? policies in relation to the contestability of contracts for the provision of services;

    ? policies to avoid conflicts of interest, including proposed transactions between the

    Company and members of management and Directors;

    ? related party transactions and the adequacy of disclosure in the financial

    statements:

    ? the management of taxation obligations and risks;

    ? the current report summarising the Company’s Risk Management Review;

    ? the adequacy of the Company’s insurance coverage and the level of risk retained;

    and

    ? the Company’s exposure to foreign exchange risk and its strategies to manage that

    risk.

Appointment of external auditors

    The Committee shall make recommendations to the Board in relation to the external

    auditors regarding:

    ? their appointment, reappointment or replacement (subject to member ratification);

    ? remuneration; and

    ? monitoring the effectiveness and independence of the external auditors, including

    resolutions of disagreements between management and the auditor regarding

    financial reporting.

The Committee shall pre-approve any audit or other services provided by the external

    auditor and shall not engage the external auditor to perform any services that may impair

    or appear to impair the external auditor’s judgment or independence. The Committee may delegate pre-approval authority to a member of the Audit Committee. The member to

    whom pre-approval authority has been delegated must report back to the full Audit

    Committee on decisions made.

Assessment of the external auditors

    At least once per year, the Committee shall obtain and review a report from the external

    auditor describing:

    ? the overall scope of the external audit, including identified risk areas and any

    agreed-upon additional procedures in conjunction with agreeing the scope of the

    external auditor’s procedures, the Committee will review the external auditor’s

    compensation;

    ? the audit firm’s quality control procedures;

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    ? any material issues raised by the most recent internal quality control review; or

    peer review of the audit firm; or by any inquiry or investigation by government or

    professional authorities, within the preceding five years, respecting one or more

    independent audits carried out by the firm, and any steps taken to deal with any

    such issues; and

    ? all relationships between the external auditor and the company.

Independence of the external auditors

    The Committee shall review and assess the independence of the external auditor,

    including, but not limited to, any relationships with the Company or any other entity that

    may impair or appear to impair the external auditor’s judgment or independence in

    relation to the Company.

Internal audit and communication

    The Committee shall recommend to the Board the appointment and termination of the

    internal auditor (the internal audit function may be full time, part time or an engagement

    specific function, as considered appropriate by the Audit Committee). The internal audit

    function shall be independent of the external audit.

The Committee shall review the scope of the internal audit including work plan & quality

    control procedures.

The Committee will review the performance and objectivity of the internal audit function.

The Committee will establish procedures for dealing with complaints received by the

    Company (including the receipt, retention, and effective treatment of these complaints)

    regarding accounting, internal controls; and with the submissions by employees,

    including anonymous submissions, of concerns regarding questionable accounting

    matters, control issues and auditing matters. All such employee submissions will be

    treated as confidential. The committee shall receive reports of evidence of any material

    violations of the Corporations Act or breaches of fiduciary duty.

Committee performance

The Committee shall make an evaluation of its performance at least once every two years

    to determine whether it is functioning effectively by reference to current best practice.

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