An audit committee is a subcommittee of a public company’s Board of Directors. Furthermore, a Board of Directors can have several subcommittees. The committee focuses on corporate governance, specifically, the company’s internal controls and financial accounting systems.
Audit Committee Membership
A company’s committee typically includes a number of outside directors, or non-executive directors. In addition, a committee prefers individuals with financial accounting expertise.
Audit Committee Purpose
This committee has several responsibilities as well as purposes. For example, it is responsible for overseeing the company’s financial reporting. In addition, it is responsible for financial accounting policies and procedures. The duties also include the following:
- Selecting and overseeing external auditors
- Ensuring regulatory compliance
- Monitoring the company’s internal controls
- Overseeing risk management.
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See Also:
How to Control Annual Audit Fees
Managed Sales and Use Tax Audit Programs
Double Entry Bookkeeping
Direct Method Allocation
Company Life Cycle
