NEW TALISMAN GOLD MINES LTD (“NTL”)
This Charter sets out the operating guidelines for the Audit and Financial Risk Committee (“Audit Committee”) of New Talisman Gold Mines Ltd (“NTL”). The Audit Committee assists the Board in overseeing all matters relating to financial risk management and the financial management, accounting, audit and reporting of NTL and its subsidiaries. This Charter applies in addition to matters set out in the Board Charter.
2. Role and Purpose of the Audit Committe
Board Committees are established to perform particular work on an ongoing basis. Within that mandate, the purpose of the Committee is to provide a specific governance focus on Financial risk and Financial reporting of NTL and its subsidiaries.
The primary role of the Audit Committee is to fulfil the responsibilities specified in this Charter, and in the course of doing so, assist the Board to carry out the following:
- To monitor the integrity of the financial statements of the Company, reviewing significant financial reporting judgments;
- To review the Company’s internal financial control system and, unless expressly addressed by a separate risk committee or by the Board itself, risk management systems;
- Review and monitor the quality, credibility and objectivity of the corporate reporting processes and accounting/treasury policies;
- To monitor and review the effectiveness of the Company’s internal audit function. If the company has not adopted an internal audit function, it should disclose on the corporate governance page on the Company’s website that fact and the alternative processes it employs in order to evaluate and continually improve the effectiveness of its risk management and internal control processes;
- To monitor and review the external auditor’s independence, objectivity and effectiveness, taking into consideration relevant professional and regulatory requirements; and
- Periodically review external auditor appointment and audit partner rotation.
- Provide a formal forum for free and open communication between the Board, external auditors and management.
By undertaking these functions the Audit Committee will assist Board members to meet their due diligence requirements with respect to financial risk management and reporting.
This Audit Committee has an ongoing role and purpose in support of the Boards governance of NTL. As such it can only be disestablished through a resolution of the full Board.
3. Composition of the Audit Committee
- The Board will appoint the Chair of the Audit Committee and the Audit Committee members;
- The Chair of the Audit Committee will be an independent Director who is not the Chair of the Board;
- The Audit Committee will comprise at least three members. The majority of members shall be independent and non-executive members of the Board;
- At least one member is to have significant, recent and relevant financial experience.
- The quorum will be two Directors with one member of management in the role of secretary;
- Meetings may be conducted in person or via video or teleconferencing.
4. Audit Committee Procedure
- The Audit Committee shall meet at least bi-annually to consider and recommend that the Board adopt the half yearly and annual financial statements and related documentation. The Audit Committee will have further meetings on an as required basis;
- Minutes of all meetings of the Audit Committee are to be kept and the minutes and a report of actions taken to be given at each subsequent meeting of the full Board of directors.
- The Chair will meet with Management and the external auditors (Either together or separately) as the Chair deems appropriate;
- The Audit Committee will meet the External Auditors without Management present as a standing agenda item at each half yearly and annual meeting and at other meetings if requested by the External Auditor;
- The CEO and contracted Financial Controller will attend all Audit Committee Meetings.
- The Company Secretary will be secretary to the Audit Committee, or any other NTL employee as recommended by the CEO and appointed by the Chair;
- The secretary will prepare the agenda in consultation with the Committee Chair;
- Audit Committee papers will be available to Directors at least three working days before the Committee meeting (unless agreed with the Chair);
- The secretary will take and maintain accurate minutes of the Committee’s meeting, and will provide draft minutes to the Chair within five working days after the meeting;
- Approved minutes of the Audit Committee meetings will be included in the following Board meetings papers; and
- Approved minutes will be available to Directors and management.
5. Induction, Continuous Development and Resources
The Company will provide the Audit Committee with sufficient resources to undertake its duties, including provision of educational information on accounting policies and other financial topics relevant to the Company and such other relevant materials requested by the Audit Committee.
The Chair of the Audit Committee will ensure appropriate induction of new Board members and the continuous development of existing Board members. In addition, the Audit Committee may obtain further information from external specialists if and as required.
6. Reporting to the Shareholders
- The Directors’ report to contain a separate section that describes the role of the Audit Committee and what action it has taken.
- An independent member of the Audit Committee to be present at the AGM to answer questions, through the Chairperson of the Board.
- Auditor to be invited to be present at shareholder meetings.
7. Powers and Authority
In addition to the powers and authorities specified in the Board Charter, the Audit Committee is specifically authorised by the Board to perform activities within the scope of its Charter. In summary the Audit Committee has power and authority to:
- Investigate any activity within its Charter and any matters requested by the Board;
- Resolve any disagreements between management and the external auditor regarding financial reporting;
- Review and approve policies in respect of all matters related to enterprise risk management and financial reporting with the exception of treasury policies;
- Review and recommend change in the Treasury policy to the Board;
- Review and approve any Director certificates required pursuant to financing arrangements provided that two members carry out such execution;
- Recommend for shareholder approval candidates to act as the external auditor – but only if they are appropriately qualified and meet the independence criteria set out by the Board.
- Appoint the external auditor (subject to annual shareholder approval) and terminate the external auditors appointment as appropriate;
- Approve the remuneration and terms of engagement of the external auditor.
Appendix A to this Charter sets out the responsibilities and duties delegated to the Audit Committee by the Board. The purpose of this delegation is to assist the Board to fulfil its responsibilities and objectives in respect of all matters related to financial risk management and financial reporting for NTL and to enable the Audit Committee to make recommendations to inform Board decision making.
The responsibilities and duties delegated to the Audit Committee by the Board are also intended to assist Board members in taking reasonable steps to acquire and maintain up-to-date knowledge of risk management and financial reporting matters that are relevant to NTL.
It is not the responsibility of the Audit Committee to conduct accounting or auditing reviews or procedures. Accordingly:
- Management is responsible for the preparation, presentation and integrity of the financial statements;
- Management is responsible for implementing and maintaining appropriate accounting and financial reporting principles and policies and internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations;
- NTL’s external auditors are responsible for planning and carrying out each external audit and review, in accordance with applicable auditing and review standards; and
- NTL’s external auditors are accountable to shareholders (through the Audit Committee and the Board).
The Board retains overall responsibility for financial risk management and financial reporting, and has absolute direction to accept or disregard recommendations or actions of the Audit Committee.