MIod and KPMG launches guide on The Audit Committee’s role in Control and Management of Risk
Audit committees have greater responsibility today, therefore the importance of risk in the business world must be considered. The codes of good governance in Mauritius and abroad put a lot of emphasis on risk management. In this line the Mauritius Institute of Directors (MIoD) and KPMG launch of the third Position Paper issued by the Mauritius Audit Committee Forum entitled “The Audit Committee’s role in Control and Management of Risk”.
The Mauritius Audit Committee Forum, an initiative of Miod and KPMG which has existed since 2013, aims to support the members of audit committees by creating guides on best practices. This third publication was launched at Hennessy Park Hotel by the president of the Mauritius Bankers Association.
According to George Leung Shing, Chairman of the Audit Committee Forum, this publication will enable members of audit committees to better understanding on the risks within companies and internal controls that are a key aspect of the management of these risks.
“The functioning of an audit committee and risk management are the responsibility of the board. Risk governance encompasses many aspects, including the establishment and maintenance of effective internal controls systems. This publication will allow members of audit committees to master the implementation of these systems with three lines of defense, in particular, establish a control environment for risk, a management strategy and policy procedures and functional monitoring. This will better meet the challenges and provide independent assurance, “he explains.
This Position Paper is the third in a series of guides produced by the Mauritius Audit Committee Forum. The first guide, published in 2014 focused on the key elements of the functioning of the Audit Committee with objective of ensuring the integrity of a company through internal procedures and financial reporting. The second publication, issued in May 2015 focused on the interaction between audit committees and internal and external auditors.
John Chung, Audit Partner at KPMG, talks about the purpose of the Audit Committee Forum, a support for audit committees.
“There are very high expectations of the role of the audit committee. Audit committees, management and the auditors should discuss items such as financial and operational risks, risk mitigation, reporting of financial accuracy and cyber risks among others. This new publication is dwelt on the risk integral part of business. Without the risk, there is no opportunity for growth. It is imperative for management to identify and understand the different risks within an organization. Ultimately, it is the board that is responsible for the risks taken by an organization to achieve its strategic goals, “said the latter.
Audit committees also have greater responsibility today, adds Jane Valls, CEO of the Mauritius Institute of Directors.
“We must also consider the importance of risk in the business world today. The codes of good governance in Mauritius and abroad put a lot of emphasis on risk management. It is important that the board decides whether it needs a separate risk committee. If the Council decides that this is the audit committee to deal with risk management, then this committee should be prepared for this responsibility, “she said.
The launch of the third Position Paper was also followed by a panel entitled “Interaction of Audit Committees with Internal and External Auditors.” This training is based on the principles of the second Position Paper issued by the Mauritius Audit Committee Forum and target members of boards of directors, senior executives and members of audit committees.