Terms of reference

Audit Committee Terms of Reference (Amended March 2011)

The purpose of the Audit Committee (AC) is to support the Management Board to ensure a financially sound and efficient organisation which makes full and effective use of resources in support of DFID objectives as set out in the Business Plan; and to advise the Accounting Officer on the adequacy of risk, control and governance processes in DFID. It plays a key role in supporting DFID’s reputation for excellent financial and risk management.
In order to achieve this, the Committee will:

• Consider Directors’ Statements and the Statement on Internal Control and any progress in and proposals for strengthening the overall control environment.
• Consider the draft Resource Accounts prior to their submission to the Accounting Officer.
• Actively seek and assess proposals for improvements to corporate governance, including risk management within DFID; and review changes to the Corporate Risk Register.
• Agree annual and longer-term internal audit strategies and programmes; consider annual internal audit reports and fraud reports, review management responses – including calling Directors to account as necessary - and advise how to promote effective learning of lessons emerging from them.
• Review the conclusions of external audit (including the NAO’s audit of the Resource Accounts) and their implications for DFID.
• Maintain an overview of performance against DFID’s Efficiency Review Targets.
• Review progress of ARIES benefits realisation.
• Focus on key thematic areas of importance to DFID.
• Support improved communication of financial awareness and compliance issues.

The Committee will endeavour to complement rather than duplicate the work of the Management Board and the other Sub-committees: an issue which has been considered by the AC will not normally then be submitted to the Board. The Committee will set annual objectives for its work and report annually to the Management Board on progress against these objectives. The Committee will submit its membership, terms of reference and work plan to the Management Board for approval every spring. The Committee’s Terms of Reference were last agreed at the Management Board Review of Sub-Committees in 2010.

Membership

As at March 2011, the Audit Committee comprises:

• Doreen Langston (Chair) (Non-Executive Director)
• Ian Barry (Non-Executive member)
• Peter Farrar (Non-Executive member)
• Mel Zuydam (Non-Executive member)
• Rachel English (Non-Executive member)
• Anwar Ahmed (Non-Executive member)

The Committee is considered quorate when at least three members are present.

The Committee may require any members of the Management Board or staff to attend meetings for a particular issue as necessary. The following non-members also regularly attend:

• Director, Value for Money
• National Audit Office (NAO) representative
• Head of Internal Audit Department

Staff are able to observe the meetings of the Committee by prior arrangement with the Committee Secretariat.

Secretariat

Responsibility for the AC secretariat lies with the Financial Accounting and Operations Group in Finance and Corporate Performance Division.

Frequency of Meetings

The Committee will normally meet 5 times a year. Meetings will be held in the spring (inter alia to review the IAD work programme for the coming year) and the autumn (to consider the draft Accounts and IAD’s report on the previous year’s activities); and at other times as required.