Audit and Risk Committee
(As approved by the Board of Trustees in May 2005 and amended in May 2013 and May 2014)
I. Purpose and Authority
The Audit and Risk Committee assists the Board of Trustees in its oversight of:
- The financial reporting process to ensure the transparency and integrity of financial reports;
- The effectiveness of the University’s internal control and risk management environment;
- The Enterprise Risk Management Framework;
- The independent audit process, including recommending the appointment and assessing the performance of the external auditor;
- The effectiveness of the internal audit function;
- The University’s compliance with legal, statutory and regulatory requirements, including requirements regarding the health and safety of employees.
The Committee has the authority to request any investigation appropriate to fulfilling its responsibilities.
The Committee has the authority, with consent of the Chair of the Board of Trustees, to retain professional advisors as the Committee deems necessary to carry out its duties.
II. Duties and Responsibilities
With regard to its oversight responsibilities for each of the topics below, the Committee shall:
A. Financial Reporting and Internal Control and Risk Management Systems
- Review the University’s annual consolidated audited financial statements and recommend approval of these financial statements to the Board of Trustees. The review should include discussion with the administration and the external auditors of significant issues regarding accounting principles, practices, adequacy of disclosure, and significant administration estimates and judgements.
- Review and discuss significant findings and recommendations of the external auditors set out in the Management Letter, together with administration’s responses.
- Review the Annual Financial Report and other related reports with financial disclosures as appropriate.
- Review significant accounting and reporting developments, including recent and contemplated professional and regulatory proposals, and understand their impact on financial reports.
- Review with the administration and the external and internal auditors the overall effectiveness of the internal control framework, including the efficiency and effectiveness of operations, safeguarding of assets and integrity of financial transactions, and steps taken by administration to minimize significant exposures.
- Discuss with the administration significant financial risk exposures and the steps administration has taken to monitor and manage these financial risks.
- Evaluate the effectiveness of the University-wide risk management framework. Receive and consider reports on significant risks or exposures to the University and the management of these.
- In addition to the general responsibility for oversight of the University-wide risk management framework, utilize a proactive approach to monitor trends, initiatives and developments in the specific risk categories as assigned by the Board of Trustees from time to time and approve strategies and directions to mitigate the likelihood or severity of events or conditions that could contribute to the potential occurrence of the situations described in the Risk Definitions for those assigned risk categories.
- Review, at every meeting, issues that have the potential to impact student health, safety and wellness.
B. External Audit Process
- Annually recommend to the Board of Trustees the appointment of the external auditors, and, in consultation with the administration, their compensation.
- Review the proposed audit scope and approach for the upcoming consolidated financial statement audit and other mandated audits.
- Annually review and assess the independence and performance of the external auditors, including a review of all non-audit services provided by the external auditors.
- Review the external auditors’ findings and administration’s response, the external auditors’ evaluation of the quality and appropriateness of accounting principles applied in financial reporting and any unresolved material differences of opinion.
- Meet privately with the external auditors to discuss any matters that the Committee or the external auditors believe should be discussed privately.
- Agree on a process for pre-approving and reporting of non-audit services provided by the external auditor.
C. Internal Audit Function
- Periodically review and approve the mandate and objectives of the internal audit function.
- Review the proposed internal audit plan for the coming year along with the criteria upon which it is based (the risk assessment process).
- Review and discuss significant findings and recommendations resulting from internal audits, special investigations and other reviews of internal controls along with administration’s responses and follow-up actions.
- Review the organization, structure and resources of the internal audit function and the qualifications of internal audit personnel.
- Through the Committee Chair, in consultation with the Vice-Principal (Finance and Administration), review and concur with the appointment, re-assignment or dismissal of the Director of the internal audit function.
- On an annual basis, meet privately with the Director of the internal audit function.
D. Legal Compliance
On an annual basis, review with the University’s legal counsel: a) any legal matters that could have a significant impact on the financial statements, b) compliance with applicable laws and regulations, and c) inquiries received from regulators or government agencies.
E. Other Duties
- Review and ensure that procedures are in place for the receipt, retention and treatment of complaints or disclosures regarding accounting, internal accounting controls and auditing matters as well as harassment, discrimination, workplace violence and other behavioural issues arising in the workplace and on campus (Safe Disclosure).
- Complete periodic self-assessments of the effectiveness of the Committee against its mandate and report these results to the Board.
- Ensure that Committee members receive appropriate orientation regarding the work of the Committee, and that training to enhance financial literacy and best practices in risk management is made available.
- Periodically review the Committee’s mandate and update as required.
- Perform any other activities consistent with the Committee’s mandate, other rules and regulations, and governing laws, as the Committee or the Board deems necessary or appropriate.
The majority of members shall be financially literate (defined as having the ability to read and understand financial statements of the breadth and complexity comparable to those of the University). At least two members of the Committee shall be "financial experts" with extensive accounting and/or related financial management expertise, such that they understand fund accounting and generally accepted accounting principles (GAAP), and in the case of GAAP, have the ability to assess the application of these principles in connection with accounting estimates, accruals and reserves.
The Committee shall include no more than two external (non-trustee) members.
The Committee shall meet four times annually, or more frequently as required.
|M. Wilson Trider
Chair: M. Wilson Trider
Vice-Chair: B. Warmbold
Secretary: C. Garneau