Introduction to Audit Committee

As per Section 177 of the Companies Act 2013, every listed company is required to constitute an Audit Committee. The Audit Committee is responsible for overseeing the company’s financial reporting process, the audit process, and the company’s internal controls and risk management systems. The minutes of the Audit Committee meetings are a crucial document that helps to maintain the transparency and accountability of the committee’s decisions and actions. The following are the key elements that should be included in the minutes of the Audit Committee meetings:

Key Elements of Audit Committee

1. Date and Time: The date and time of the meeting should be clearly mentioned at the top of the minutes.
2. Attendance: The names of the members who attended the meeting and the names of any guests or other attendees should be listed.
3. Agenda: The agenda for the meeting should be clearly stated. This should include the items discussed and any actions taken.
4. Discussion: The minutes should include a summary of the discussion that took place during the meeting. This should include any presentations made, questions asked, and answers given.
5. Decisions and Actions: The minutes should record any decisions that were made during the meeting and any actions that were agreed upon. This should include who is responsible for each action and when it is due.
6. Matters Arising: The minutes should include any matters arising from the previous meeting and any follow-up actions taken.
7. Any Other Business: The minutes should include any other business that was discussed during the meeting.
8. Next Meeting: The date, time, and location of the next meeting should be noted.
9. Approval: The minutes should be approved by the members of the Audit Committee at the next meeting.
10. Signature: The minutes should be signed by the Chairperson of the Audit Committee.

It is important to note that the minutes of the Audit Committee meetings should be accurate, comprehensive, and objective. The minutes should also be maintained as a permanent record and kept in a safe place.

Draft Minutes of Audit Committee

Minutes of the Audit Committee Meeting of ABC Company Limited held on [Date] at [Time] at the registered office of the company

Attendance:

• Mr. A, Chairperson of the Committee (present)
• Mr. B, Committee Member (present)
• Mr. C, Committee Member (present)
• Mr. D, Internal Auditor (present)
• Mr. E, Company Secretary (present)

Agenda:

1. Review of the financial statements of the company for the quarter ended [Date]
2. Discussion on the findings of the internal audit report
3. Review of the risk management framework of the company
4. Any other matter with the permission of the Chair

Discussion: The Chairperson welcomed the members and commenced the meeting. The committee discussed the following agenda items:

1. Review of the financial statements of the company for the quarter ended [Date]: The committee reviewed the financial statements and noted that they were prepared in accordance with the applicable accounting standards and provided a true and fair view of the company’s financial position. The committee recommended the approval of the financial statements to the Board of Directors.
2. Discussion on the findings of the internal audit report: The Internal Auditor presented the findings of the internal audit report. The committee discussed the findings and recommended that the management take appropriate actions to address the identified weaknesses and improve the internal controls of the company.
3. Review of the risk management framework of the company: The committee reviewed the risk management framework of the company and recommended that the management enhance the risk management policies and procedures to ensure effective identification, assessment, and mitigation of risks.

Decisions and Actions: The committee made the following decisions and actions:

1. Approval of the financial statements for the quarter ended [Date] and recommendation for the same to the Board of Directors.
2. Recommendation to the management to address the weaknesses identified in the internal audit report and improve the internal controls of the company.
3. Recommendation to the management to enhance the risk management policies and procedures of the company.

Matters Arising: There were no matters arising from the previous meeting.

Any Other Business: There was no other business discussed.

Next Meeting: The next meeting of the Audit Committee was scheduled to be held on [Date] at [Time] at the registered office of the company.

Approval: The minutes were approved by the committee members at the meeting.

Signature: The Chairperson signed the minutes.

Conclusion to the Audit Committee Meetings

An audit committee is a group of independent people who are appointed by a company’s board of directors to review and monitor the company’s financial reporting process, internal controls, and audit process. The audit committee acts as a link between the company’s management, board of directors, and external auditors.

It is responsible for overseeing the company’s financial reporting to ensure accuracy and transparency, identifying and mitigating financial risks, and ensuring compliance with legal and regulatory requirements. In simpler terms, the audit committee helps to ensure that the company’s financial information is reliable, accurate, and in compliance with the law.

References

1. https://www.csannusharma.com/10-draft-minutes-of-committee-meetings/
2. 10 Draft Minutes of Committee Meetings
3. https://www.stockmanngroup.com/en/audit-committee-charter#:~:text=A%20meeting%20of%20the%20Audit,the%20secretary%20of%20the%20meetings.