HomeMy WebLinkAboutAudit Committee Policy with Amendments to January 26, 2021 #CBflM14e---1(�44e--W-r6W
Cape Breton Regional Municipality
Cape Breton Regional Municipality
Audit Committee Policy
1.0 PURPOSE:
The Audit Committee assists Municipal Council in fulfilling its oversight responsibilities
relating to finance and audit matters delegated to management by Council. In particular, the
Committee assists Council by reviewing:
a. Key financial information that will be provided to the Province or made public;
b. External and/or internal audit activities
c. The system of internal controls, risk management and financial information
technology;
d. Cash and investment management activities;
e. Insurance coverage and significant risks and uncertainties;
f. Financial Condition Indicators.
2.0 SCOPE:
This Policy is applicable to all serving members of the Cape Breton Regional Municipality's
Audit Committee.
3.0 REFERENCES:
3.1 S. 44 - Now Scotia Municipal GovenimentAct(MGA).
4.0 DEFINITIONS:
4.1 CAO means the Chief Administrative Officer for the Cape Breton Regional
Municipality.
4.2 CFO means the Chief Financial Officer of the Cape Breton Regional Municipality.
4.2 Independent means not an employee, council member or immediate family
member; and not an employee of an agency funded in whole or in part by CBRM.
CBRM Audit Committee Policy 2
5.0 POLICY, DUTIES AND RESPONSIBILITIES:
5.1 Composition
It is the responsibility of Council to ensure that audit committee members are independent,
financially literate, and have the skills to serve as effective audit committee members:
• a general understanding of the Municipality's major economic, operating, and financial
risks;
• a broad awareness of the interrelationship of the Municipality's operations and its
financial reporting;
• understand the difference between the oversight function of the Committee and the
decision-making function of management; and
• a willingness to challenge management,when necessary.
5.1.1 The audit committee will consist of 7 members — the Deputy Mayor, 4 Council
members and two members at large.
5.1.2 The Chair shall be the Deputy Mayor.
5.1.3 Citizen appointments shall be residents of the Cape Breton Regional Municipality, be
independent, and possess a professional accounting designation.
5.1.4 Citizen appointments will serve 2 year terms and will rotate off in opposite years to
maintain continuity. In the first year, or in any year where both positions are vacated at or
prior to term expiry, one of the members at large will sit for a two year term with an option
to extend for an additional 1 year term.
5.1.5 All Committee members serve without pay.
5.2 Audit
5.2.1 Review the qualifications, independence, quality of service, performance and fees of
the External Auditors annually and recommend the appointment of an auditor to Council;
5.2.2 Carry out the responsibilities of an Audit Committee contained in Section 44 of the
Municipal Government Act;
a. Review with Management and the External Auditor, the annual audited financial
statements and recommend the approval to Council;
b. Review with Management, the internal control management letter received from the
auditors and recommend any changes to Council, as required;
c. Review of such matters arising out of the audit as may appear to the audit committee
to require investigation;
d. Inquire into any activities or transactions that may be illegal, questionable or
unethical;
e. Review the overall reasonableness of CAO, Mayor and Council travel and hospitality
expenses;
f. Such other matters as may be determined by Council to be the duties of an audit
committee.
Cape Breton Regional Municipality
CBRM Audit Committee Policy 3
5.2.3 Recommend approval of the audited financial statements to Council.
5.3 Finance and Risk Management
5.3.1 Ensure that meaningful financial information regarding current financial results and
up to date forecasts is received on a timely basis, and that it provides information required
for decision making;
5.3.2 Review with Management annually all financial policies including those used in the
preparation of the external financial statements;
5.3.3 Review with Management the adequacy of internal controls;
5.3.4 Review with Management the adequacy and use of reserve and surplus funds;
5.3.5 Review with Management annually risk management practices including adequacy of
insurance coverage for significant risks and uncertainties.
5.3.6 Periodically assess banking services, oversee the procurement of these services in
accordance with Council policy, and recommend any changes to Council.
5.4 Administration
5.4.1 The Committee shall meet at least twice during each fiscal year.
5.4.2 Additional meetings may be necessary to review items relating to the audit and will
be called by the Chair.
5.4.3 The CAO and CFO will provide staff support to the Committee.
5.4.4 The agenda will be agreed upon by the Committee Chair, CAO, and CFO.
5.4.5 The Committee shall meet with the external auditors as it deems appropriate to
consider any matter the Committee or auditors determine should be brought to the attention
of Council;
5.4.6 There may be an occasional need for the auditor to meet with the Committee
without staff present. This can be initiated by either party.
5.4.7 The Committee may also call upon the expertise from external sources (e.g. actuaries,
finance professionals) to assist with committee business as required.
Approved by Council: March 7, 2018
Amended: January 26, 2021
Cape Breton Regional Municipality