APVMA Audit Committee Charter

The Chief Executive Officer has established an Audit Committee in compliance with section 45 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and PGPA Rule section 17—Audit committee for Commonwealth entities.

Functions

Section 17(2) of the PGPA Act (the Rule) establishes mandatory functions for Audit Committees:

1. the accountable authority of a Commonwealth entity must, by written charter, determine the functions of the Audit Committee for the entity

2. the functions must include reviewing the appropriateness of the accountable authority’s:

  • financial reporting
  • performance reporting
  • system of risk oversight and management
  • system of internal control.

Consistent with the requirement of subsection 17(2) of the Rule, the Chief Executive Officer of the Australian Pesticides and Veterinary Medicines Authority (APVMA), as the accountable authority, has determined that the functions of the committee are to review the appropriateness of, and to provide written advice on, the APVMA’s:

Financial reporting

1. review the financial statements and provide advice to the Chief Executive Officer (including recommending their signing by the Chief Executive Officer). In particular, the committee will:

  • assess the APVMA’s compliance with accounting standards, including an assessment of the appropriateness of accounting policies and disclosures
  • assess areas of significant judgement and financial statement balances that require estimation
  • assess any significant changes to accounting policies and practices (by May each year)
  • review significant or unusual transactions
  • assess whether appropriate management action has been taken in response to any issues raised by the ANAO, including financial statement adjustments or revised disclosures

2. review the processes in place designed to ensure that financial information included in the APVMA’s annual report is consistent with the signed financial statements

3. discuss with the ANAO the auditor’s judgments about the adequacy of the APVMA’s accounting policies and the quality of the APVMA’s processes for the preparation of the APVMA’s financial statements.

Performance reporting

1. monitor the standard of non-financial performance information provided to the Chief Executive Officer

2. review the proposed reporting of the APVMA’s performance to ensure that the information is consistent with the APVMA’s reported financial information

3. review the APVMA’s systems and procedures for assessing and reporting the achievement of the APVMA’s performance. In particular, the committee will:

  • provide an annual update on the agency’s performance reporting framework
  • provide advice annually about processes for developing the performance statement
  • review the draft agency performance statement at the financial statements meeting; and
  • a biennial review/audit of the agency assurance mechanisms as they relate to the performance framework. This would be measured against the points set out in the Quick Reference Guide RMG 131—Developing Good Performance Information.

Systems of risk oversight and management

1. assess whether management has in place a sound enterprise risk management framework and associated procedures for effective identification and management of the APVMA’s business and financial risks, including fraud, and endorse the Risk Management Framework

2. determine whether a sound and effective approach has been followed in managing the APVMA’s major risks, including those associated with individual projects, program implementation and activities

3. satisfy itself that management has assessed the impact of the APVMA’s risk management framework on the APVMA’s control environment

4. monitor the adequacy of insurance over for the APVMA

5. monitor reports on fraud from APVMA management that outline any significant or systemic allegations of fraud, the status of any ongoing investigations and any changes to identified fraud risk in the entity

6. at least annually, commission and approve an entity-wide assurance map that identifies the entity’s key assurance arrangements

7. determine whether a sound and effective approach has been followed in establishing the APVMA’s business continuity planning arrangements, including whether business continuity and disaster recovery plans are periodically updated and tested.

System of internal control

1. assess the APVMA’s overall internal control environment, as reflected in its governance, risk management, legislative, policy and security compliance and business continuity management arrangements

2. assess the APVMA’s internal audit resourcing and coverage in relation to the APVMA’s key risks, and recommending approval of the Internal Audit Plan by the CEO

3. assess the APVMA’s internal and Australian National Audit Office (ANAO) audit reports, providing advice to the CEO about significant issues identified, and the implementation of agreed actions in accordance with the APVMA’s agreed approach

4. assess where relevant, the APVMA’s compliance with International Conventions, particularly the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions

5. provide advice to the Chief Executive Officer regarding the issue of the APVMA’s annual Certificate of Compliance, or equivalent Report.

Engagement with the ANAO

1. the committee will engage with the ANAO, as the APVMA’s external auditor, in relation to the ANAO’s financial statement and performance audit coverage. In particular, the committee will:

  • meet privately with the ANAO at least once per year.

Membership

The Audit Committee comprises:

  • at least three persons who have appropriate qualifications, knowledge, skills or experience to assist the committee to perform its functions
  • a majority of external members.

Members will be appointed for periods as specified by appointed by the Chief Executive Officer.

The Chair of the committee will be one of the external members. The Deputy Chair of the committee will be the person holding the position of Deputy Chief Executive Officer of the APMVA.

The Chief Executive Officer, the Director Corporate Services, or other management representatives may attend meetings as advisers or observers, as determined by the Chair, but will not be members of the committee.

A representative(s) of the ANAO will be invited to attend meetings of the committee, as an observer.

Membership of the committee will be reviewed periodically (but at least every three years) by the Chief Executive Officer with the aim of ensuring an appropriate balance between continuity of membership, the contribution of fresh perspectives and a suitable mix of qualifications, knowledge, skills and experience.

The committee will adopt and maintain a program of induction, training and awareness-raising for itsmembers, with the objective of enabling the committee to keep abreast of contemporary developments and leading practices in relation to its functions.

Authority

The Chief Executive Officer authorises the committee, in performing its functions, to:

1. obtain any information it requires from any official or external party (subject to any legal obligation to protect information)

2. discuss any matters with the ANAO, or other external parties (subject to confidentiality considerations)

3. request the attendance of any official at committee meetings, and

4. obtain legal or other professional advice at the APVMA’s expense, as considered necessary to meet its responsibilities.

The CEO directs officials of the APVMA to cooperate with the committee.

Independence

The committee is directly accountable to the CEO for the performance of its functions. The committee has no executive powers in relation to the operations of the APVMA. The committee may only review the appropriateness of particular aspects of those operations, consistent with its functions, and advise the CEO accordingly.

Responsibility for the appropriateness of the APVMA’s financial reporting, performance reporting, system of risk oversight and management, and system of internal control rests with the CEO and officials of the APVMA.

Members or observers with a conflict of interest will notify the committee as soon as these issues become apparent. Any member with a conflict of interest will absent themselves from discussions about relevant matters.

All decisions of the committee shall be referred to the Chief Executive Officer for approval, other than:

1. the APVMA’s Internal Audit Charter, Internal Audit Plan and

2. the APVMA-wide assurance map.

The internal audit budget and appointment of internal auditors are to be agreed by the Chief Executive Officer after consultation with the Chair.

Reporting

The committee is responsible to, and will regularly update the Chief Executive Officer on its activities and make recommendations, as appropriate.

The Chair will report to the Chief Executive Officer following a meeting of the committee on any matters that the committee considers should be brought to the attention of the Chief Executive Officer.

The committee will at least once annually confirm to the Chief Executive Officer that all functions/responsibilities outlined in this charter have been carried out, and comply with any other reporting requirements specified by the Chief Executive Officer from time to time.

During the year, to meet its obligations under the PGPA Act and the Charter, the committee will provide written advice to the CEO on its view of the appropriateness of:

1. the APVMA’s annual financial statements and financial reporting

2. the annual performance statements and performance reporting

3. the systems for risk oversight and management

4. the systems for internal control.

Meetings

The committee will meet at least four times per year. One or more special meetings may be held to review the APVMA’s annual financial statements or to meet other responsibilities of the committee.

All committee members are expected to attend each meeting, in person or via tele-or-video conference.

The Chair is required to call a meeting if asked to do so by the Chief Executive Officer and decide if a meeting is required if requested by another member, internal audit or the ANAO.

A quorum for any committee meeting will be two members, one of whom must be the Chair or Deputy Chair, and one of whom must be an external member.

Secretariat

The APVMA will provide secretariat services to the committee.

Review of functions

The Chair will initiate a review of the performance of the committee at least once every two years. The outcomes will be reported to the CEO.

The Committee will review the charter every three years, in consultation with the CEO.

Any substantive changes to the charter will be recommended by the committee and formally approved by the Chief Executive Officer.

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