Jul 01, 2014
From the Audit Committee Institute
If you’re on an audit committee —or work closely with one—you know the committee’s workload isn’t getting any lighter, and the job isn’t getting any simpler.
In addition to their “core” duties—oversight of financial reporting and internal and external auditors, which are a substantial undertaking and time commitment—many audit committees also oversee a host of major risks facing the company.
From cyber security, emerging technologies and social media, to compliance risks posed by increased government regulation and stepped-up enforcement efforts globally, many audit committee agendas today could even be mistaken for a “risk committee’s” agenda.
Audit committee effectiveness clearly hinges on some fundamentals, including the right committee composition and dynamics; an up-to-date charter with well-defined responsibilities; a risk-based approach to setting the committee's agenda; an understanding of current and emerging issues; and proactive, engaged oversight beyond the boardroom.
In this issue of Global Boardroom Insights, we revisit the fundamentals of audit committee effectiveness with the audit committee chairs of LVMH Group, General Electric, Lenovo, Deutsche Bank, Wolseley Plc and Fubon. But we’ve also gone a step further to explore the practices and nuances that these audit committee chairs consider vital to being truly effective in a complex and rapidly changing environment.