The audit committee

The audit committe reviews the RCN’s financial and risk controls and the RCN’s annual financial statements and advises the Council on these.

Terms of reference

The role of the audit committee is to obtain assurance, on behalf of the Council of the RCN and the board of governors of the RCN Institute of the proper operation of the risk management, control and governance arrangements of the RCN and the RCNI, and of the adequacy of arrangements for ensuring economy, efficiency and effectiveness. 

Key responsibilities

Ther committees key responsibilities are to:

  1.  review the adequacy of the systems of internal control in place throughout the RCN and, in particular, keep under review the effectiveness of the risk management, legal compliance, budgetary control and governance arrangements
  2. satisfy itself with the arrangements put in place by management to ensure that the RCN and the RCN Institute prepare their annual accounts and reports in accordance with all relevant legislation and accounting standards
  3. review the audit aspects of the draft annual financial statements including the external audit opinion, the statement of members’ responsibilities, the statement of internal control and any relevant issue raised in the external auditors’ management letter
  4. make recommendations to Council and the board of governors on the appointment of the external auditors, the audit fee, and the provision of any non-audit services by the external auditors and advise on any questions of resignation or dismissal of the external auditors
  5. discuss with the external auditors, before the audit begins, the nature and scope of the audit
  6. review the internal auditor’s audit risk assessment and strategy and approve the internal audit plan
  7. ensure that an adequate and effective system of internal audit is maintained
  8. consider reports from internal and external auditors and review management responses
  9. monitor the implementation of agreed audit-based recommendations, from whatever source
  10. make recommendations to Council and/or the board of governors on any change of practice shown to be desirable from audits or best value studies
  11. monitor annually the performance and effectiveness of external and internal auditors, including any matters affecting their objectivity, and to make recommendations to Council concerning their reappointment, where appropriate
  12. ensure that all significant losses have been properly investigated and that the internal and external auditors, and where appropriate the HEFCE accounting officer, have been informed
  13. oversee the policy on fraud and irregularity, including being notified of any action taken under that policy and considering systems in place to minimise the risk of fraud
  14. satisfy itself that satisfactory arrangements are in place to promote economy, efficiency and effectiveness by commissioning and considering best value studies
  15. receive any relevant reports from the National Audit Office, HEFCE and other organisations
  16. prepare an annual audit report on the RCNI for the board of governors and HEFCE covering the institution’s financial year and any significant events up to the date of preparing the report. The committee will report on the adequacy and effectiveness of the institution’s arrangements for risk management, control and governance (the risk management element includes the accuracy of the statement of internal control included with the annual statement of accounts); and economy, efficiency and effectiveness (value for money)
  17. prepare an annual audit report on the whole of the RCN throughout the UK (including the RCN Institute) for Council.

Authority

The committee is authorised by Council and the board of governors to investigate any activity within its terms of reference.  It is authorised to seek any information it requires from any employee, and all employees are directed to co-operate with any request made by the committee.

The committee is authorised by Council and the board of governors to obtain outside legal or other independent professional advice and to secure the attendance of non-members with relevant experience and expertise if it considers this necessary. Such action would normally only be taken in consultation with the accountable officer and the chair of Council and/or the chair of the board of governors and it may not incur direct expenditure in this respect in excess of £5,000, without prior approval of these persons.

Chaired by – external adviser appointed by Council

Membership 

  • Vice-chair of Council and two other Council members who are not members of the finance and corporate services committee.
  • Two other external advisers with relevant professional expertise.
  • Two external members of the RCN Institute’s board of governors.
     

Attendees 

  • The executive director of finance and corporate services, director of administration, internal auditor and a representative of the external auditors will always attend audit committee meetings. The head of finance and the director of the Institute should also normally attend for relevant items. Other executive members of the RCN and RCN Institute will attend as required to present papers or when invited by the committee.
  • At least once a year the committee will meet with the external and internal auditors without any officers present

Accountable to – Council.

Accountable officer – executive director of finance and corporate services. 

Lead staff support – director of administration 

Frequency of meetings  – meetings shall be held at least three times each financial year.  The internal auditor or external auditors may request a meeting if they consider it necessary.

Quorum – three, being one Council member, and two being external advisers or members of the board of governors.