Appendix 14-Audit Committee Charter9-21-09

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Description

APPENDIX 14 KENTUCKY TEACHERS’ RETIREMENT SYSTEM Governance and Audit Committee Charters of the Governance and Audit Committee Purpose The Governance and Audit Committee is a committee of the Board of Trustees of the Kentucky Teachers’ Retirement System. The Committee is established to assist the Board of Trustees in fulfilling its fiduciary oversight responsibilities for Retirement System’s governance process, financial reporting process, system of risk management, system of internal control, internal and external audit process, and the process of monitoring compliance with laws and regulations. Authority The Committee has authority for matters within its scope of responsibility for the following functions: Governance Process Financial Reporting Process System of Risk Management System of Internal Controls Internal and External Audit Monitoring Compliance with Laws and Regulations Audit Committee Management and Reporting Composition The Committee will be composed of a minimum of three (3) members of the Board of Trustees. The Chair of the Board will appoint the Committee members and the Committee chair. The Chair of the Board should endeavor to appoint at least one member with an understanding of generally accepted accounting principles and financial statements; experience in the preparation or auditing of financial statements; experience with internal accounting controls; and an understanding of audit committee ...

Sujets

• management
• risk management

Informations

• Publié par: Illa
• Nombre de lectures: 13
• Langue: English

Extrait

APPENDIX 14

KENTUCKY TEACHERS’ RETIREMENT SYSTEM

Governance and Audit Committee

Charters of the Governance and Audit Committee

Adopted August 28, 2009

Page 1 of 2

Purpose

The Governance and Audit Committee is a committee of the Board of Trustees of the

Kentucky Teachers’ Retirement System.

The Committee is established to assist the Board

of Trustees in fulfilling its fiduciary oversight responsibilities for Retirement System’s

governance process, financial reporting process, system of risk management, system of

internal control, internal and external audit process, and the process of monitoring

compliance with laws and regulations

.

Authority

The Committee has authority for matters within its scope of responsibility for the following

functions:

Governance Process

Financial Reporting Process

System of Risk Management

System of Internal Controls

Internal and External Audit

Monitoring Compliance with Laws and Regulations

Audit Committee Management and Reporting

Composition

The Committee will be composed of a minimum of three (3) members of the Board of

Trustees.

The Chair of the Board will appoint the Committee members and the Committee

chair.

The Chair of the Board should endeavor to appoint at least one member with an

understanding of generally accepted accounting principles and financial statements;

experience in the preparation or auditing of financial statements; experience with internal

accounting controls; and an understanding of audit committee functions.

Meetings

The Committee will meet at least twice each year (December to review the external audit

report, and July to review the internal audit plan), with authority to convene additional

meetings, as circumstances require. All Committee members are expected to attend each

meeting.

The Committee will invite members of management, auditors, and/or others to

attend meetings and provide pertinent information, as necessary. Subject to open meeting

laws, the Committee may hold executive sessions and private meetings with auditors.

Meeting agendas will be prepared and provided in advance to members, along with

appropriate briefing materials.

Minutes of each meeting will be prepared.

Adopted August 28, 2009

Page 1 of 3

APPENDIX 14

KENTUCKY TEACHERS’ RETIREMENT SYSTEM

Governance and Audit Committee

Charter of the Office of Internal Audit

Mission and Scope of Work

The mission of internal audit is to provide independent, objective assurance and consulting

services designed to add value and improve the Retirement System’s operations. Internal audit

helps the Retirement System accomplish its objectives by bringing a systematic, disciplined

approach to evaluate and improve the effectiveness of risk management, control, and governance

processes.

The scope of work of internal audit is to determine whether the Retirement System’s network of

risk management, control, and governance processes, as designed and represented by

management, are adequate and functioning in a manner to ensure:

Risks are appropriately identified and managed.

Interaction with various employees and others occur as needed.

Significant financial, managerial, and operating information is accurate, reliable, and

timely.

Employees’ actions are in compliance with policies, standards, procedures, and

applicable laws and regulations.

Resources are acquired economically, used efficiently, and adequately protected.

Programs, plans, and objectives are achieved.

Quality and continuous improvement are fostered in the Retirement System’s control

process.

Significant legislative or regulatory issues impacting the organization are recognized and

addressed appropriately.

Opportunities for improving management control may be identified during audits. They will be

communicated to the Executive Secretary and the appropriate lower levels of management.

Accountability

The director of internal audit, in the discharge of his/her duties, shall be accountable to

management and the Committee to:

Provide annually an assessment on the adequacy and effectiveness of the Retirement

System’s processes for managing its risks and controlling its activities in the areas set

forth under the mission and scope of work.

Report important issues related to the processes for controlling the activities of the

Retirement System, including potential improvements to those processes, and provide

information concerning such issues through resolution.

Periodically provide information on the status and results of the annual audit plan and the

sufficiency of internal auditing resources.

Adopted August 28, 2009

Page 2 of 3

Coordinate with other control and monitoring functions (risk management, compliance,

security, legal, ethics, environmental, external audit).

Establish a follow-up process to track actions related to important issues and

recommendations.

Independence

The director of internal audit reports administratively and functionally to the Executive

Secretary.

However, to provide for the independence of internal auditing, the director of internal

audit shall also provide summaries of significant audit reports to the Committee and develop the

annual audit plan in consultation with the Committee.

Responsibility

The director of internal audit has the responsibility to:

Develop a flexible annual audit plan using appropriate risk-based methods, including any

risks or control concerns identified by management, and submit that plan to the

Committee for review and approval as well as periodic updates.

Implement the annual audit plan, as approved, including as appropriate any special tasks

or projects requested by the Executive Secretary and the Committee.

Evaluate and assess important merging/consolidating functions and new or changing

services, processes, operations, and control processes coincident with their development,

implementation, and/or expansion.

Issue periodic reports to the Committee and management summarizing results of audit

activities.

Keep the Committee informed of emerging trends and successful practices in internal

auditing.

Consider the scope of work of the external auditors and regulators, as appropriate, for the

purpose of providing optimal audit coverage to the Retirement System at a reasonable

overall cost.

As appropriate, provide consulting and advisory services to management that add value

and improve the Retirement System’s governanace, risk management, and control

processes without the internal auditor assuming management responsibility.

Establish a quality assurance and improvement program by which the director of internal

audit assures effective operation of internal audit activities.

Authority

The director of internal audit and staff of the internal audit office are authorized to:

Have full, free, and unrestricted access to all functions, records, property, and personnel.

Have full and free access to the Committee.

Allocate resources, set frequencies, select subjects, determine scopes of work, and apply

the techniques required to accomplish internal audit objectives.

Obtain the necessary assistance of personnel in units of the organization where they

perform audits, as well as other specialized services from within or outside the

Retirement System.

Perform consulting services to management as deemed appropriate by the Executive

Secretary.

Adopted August 28, 2009

Page 3 of 3

The director of internal audit and staff of the internal audit office are not authorized to:

Perform any operational duties for the Retirement System.

Initiate or approve accounting transactions external to the internal audit office.

Direct the activities of any Retirement System employee not employed by the internal

audit office, except to the extent such employees have been appropriately assigned to

audit teams or to otherwise assist the internal auditors.

Standards of Audit Practice

The internal audit office will consider standards of professional practice outlined by the IIA,

AICPA, and APPFA in executing the duties set forth in this charter.

APPENDIX 14

KENTUCKY TEACHERS’ RETIREMENT SYSTEM

Governance and Audit Committee

Charters of the Governance and Audit Committee

Adopted August 28, 2009

Page 2 of 2

Responsibilities

The Committee will have responsibility for providing policy recommendations to the Board

of Trustees for the following:

1.

The assessment of governance process.

2.

The integrity of financial information reporting.

3.

The policy and framework for an effective system of risk management and the

mechanisms for periodic assessment of the system of risk management.

4.

The assessment of internal administrative and accounting controls by both the

external and internal auditors.

5.

The policy and framework for an effective system of internal controls and the

mechanisms for periodic assessment of the system of internal controls.

6.

Reviewing with management and the director of internal audit the objectives, plans,

activities, staffing and organizational structure of the internal audit function.

7.

Reviewing the effectiveness of the system of monitoring and compliance with

applicable statutes, regulations and policies.

8.

Reporting to the Board of Trustees on significant activities, findings and

recommendations of the Committee.