1.1聽聽聽聽聽 Constitution
1.1.1聽聽 The audit and risk committee (鈥渢he committee鈥�) is constituted as a committee of 力博体育 Holdings Limited (鈥溋Σ┨逵��) (i) in respect of good corporate governance practices, (ii) in line with the requirements of the Australian Stock Exchange (ASX) Corporate Governance Principles and Recommendations, Third Edition (the ASX Corporate Governance Principles and Recommendations), (iii) in line with the requirements of the King IV Report on Corporate Governance for South Africa (King IV) and (iv) in respect of all other duties assigned to it by the Board.
1.1.2聽聽 The duties and responsibilities of the members of the committee as set out in this document are in addition to those duties and responsibilities that they have as members of the Board. The deliberations of the committee do not reduce the individual and collective responsibilities of Board members in regard to their fiduciary duties and responsibilities, and they must continue to exercise due care and judgment in accordance with their legal obligations as directors.
1.1.3聽 These terms of reference are subject to the provisions of the company鈥檚 memorandum 聽and 聽articles 聽of 聽incorporation and 聽any 聽other 聽applicable 聽law 聽or regulatory provision.
1.2聽聽聽聽聽 Function
1.2.1聽聽聽 聽 The overall function of the committee is to assist the directors in discharging their responsibilities relating to the safeguarding of assets, the operation of adequate and effective systems and control processes, the preparation of fairly presented financial statements in compliance with all applicable legal and regulatory requirements and accounting standards, and the oversight of the external and internal audit appointments and functions.
1.2.2聽聽聽 The committee is an advisory committee and not an executive committee. As such it must not perform any management functions or assume any management responsibilities and shall have an objective and independent role.
1.2.3聽聽聽 聽 The committee undertakes to perform its duties on behalf of all the subsidiaries of the company, unless the subsidiary has its own audit and risk committee.
1.3聽聽聽聽聽 Membership
1.3.1聽聽聽聽 The committee must comprise at least three members to be elected by the Board.
1.3.2聽聽 聽聽 Members of the committee must be non-executive directors and meet all applicable independence requirements and be suitably skilled.
1.3.3聽 聽 聽 The majority of members shall possess the necessary financial expertise and experience to serve the committee. At least one member shall preferably have the relevant operational experience.
1.3.4聽聽聽 聽The Board shall appoint a chairman to the committee who is an independent non-executive director. The chairman of the Board is not eligible to serve as a member of the committee.
1.3.5聽聽聽 聽The members of the committee should collectively have sufficient qualifications and experience to fulfil their duties, including an understanding of the following:
鈥撀犅犅� Integrated reporting which includes financial reporting;
鈥撀犅犅� Internal financial controls;
鈥撀犅犅� External audit process;
鈥撀犅犅� Internal audit process;
鈥撀犅犅� Corporate law;
鈥撀犅犅� Risk management;
鈥撀犅犅� Information technology governance;
鈥撀犅犅� The governance processes with the company.
1.3.6聽聽聽聽 The Board shall have the powers at any time to:
1.3.6.1 fill 聽vacancies 聽on 聽the 聽committee 聽within 聽40 聽business 聽days 聽after 聽the vacancy arises;
1.3.6.2 remove any member from the committee;
1.3.6.3 appoint additional members.
1.4聽聽聽聽聽 Reporting
1.4.1聽聽 聽 The chairman of the committee shall report to the Board on its proceedings after each meeting on all significant matters within its duties and responsibilities as set out in these terms of reference.
1.4.2聽聽 聽 The committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed.
1.4.3聽聽 聽 The chairman (or, in his/her absence, an alternate member) of the committee shall attend the Annual General Meeting to answer questions, through the chairman of the Board, on the committee鈥檚 activities and its responsibilities.
1.4.4聽聽 聽 The committee鈥檚 report to shareholders on its activities is to be included in the company鈥檚 integrated report.
1.5聽聽聽聽聽 Authority of the committee and resources available
1.5.1聽聽聽 聽The committee has decision making responsibilities in terms of its statutory duties with respect to the appointment, fees and terms of engagement of the auditor.
1.5.2聽聽聽聽 The committee, in carrying out its tasks under these terms of reference:
1.5.2.1 has unrestricted access to all information, including records, property and personnel of the 力博体育 group, and must be provided with adequate resources in order to fulfil its responsibilities;
1.5.2.2聽 is authorised to investigate any activity within its terms of reference;
1.5.2.3 may require other employees of the company to attend meetings or parts of meetings;
1.5.2.4 may 聽consult 聽with 聽and 聽seek 聽any 聽information 聽it 聽requires 聽from 聽any employee, and all employees shall be required to co-operate with any request made by the committee in the course of its duties;
1.5.2.5聽 may 聽invite 聽external 聽professional 聽advisers 聽to 聽attend 聽any 聽meeting 聽if 聽it considers this necessary or appropriate;
1.5.2.6 聽 may delegate its authority and duties to sub-committees or individual members of the committee as it deems appropriate, provided it is not precluded by legal or regulatory requirements from doing so.
1.5.3聽聽聽聽 In addition, the committee is allowed to consult with specialists or consultants to assist it with the performance of its functions, subject to a Board approved process being followed. Such specialists or consultants are not members of the committee and are not entitled to vote on any matters. The company must pay all expenses reasonably incurred during such consultations.
1.6聽聽聽聽 Meetings and procedures
1.6.1聽聽聽聽聽 Agenda and Minutes
1.6.1.1聽聽聽 Meetings and proceedings of the committee shall be governed by the 力博体育 articles of incorporation
1.6.1.2聽聽 聽 The Board or any member thereof, including members of the committee, the external auditors, and the chief audit executive, may call further meetings, as required and with the support of a committee member.
1.6.1.3聽聽 聽 Reasonable notice of meetings and the business to be conducted, together with all relevant supporting documentation, shall be given to the members of the committee and all invitees.
1.6.1.4聽聽 聽 Any Board member, committee member or invitee may raise issues or make proposals for consideration at the committee meetings, provided the matters raised are supported by a committee member.
1.6.1.5聽聽 聽The chairperson shall review the agenda of the business to be conducted before distribution.
1.6.1.6聽聽 聽The company secretary shall take minutes of meetings, which shall be reviewed and approved by the members of the committee.
1.6.1.7聽聽 The minutes of all committee meetings shall record the proceedings, decisions taken and the reasons therefore and the recommendations to be made to the Board.
1.6.1.8聽聽 聽The agenda for each Board meeting shall provide an opportunity for the chairperson of the committee to report on any matters of importance as well as on the committee鈥檚 findings and recommended actions.
1.6.1.9聽聽 聽The committee shall establish an annual plan each year to ensure that all relevant matters are covered by the agendas of the meetings scheduled for the year.
1.6.1.10 聽The annual plan must ensure proper coverage of the matters laid out in the audit and risk committee terms of reference; the more critical matters will need to be attended to each year while other matters may be dealt with on a rotational basis. The number, timing and the length of meetings and the agendas are to be determined in accordance with the annual plan.
1.6.1.11 聽 Committee members must be fully prepared for committee meetings, to provide appropriate and constructive input on matters discussed.
1.6.1.12 聽 The minutes must be completed as soon as possible after the meeting and circulated to the chairman and members of the committee for review thereof:
鈥撀犅犅� Proceedings and resolutions of all meetings of the committee;
鈥撀犅犅� The names of those present and attendance;
鈥撀犅犅� Any conflicts of interest.
1.6.2聽 Frequency
1.6.2.1聽聽聽聽 The committee must hold sufficient scheduled meetings to discharge all its duties as set out in these terms of reference. The committee will normally meet at least four times a year and such meetings shall be aligned with Board meeting requirements and timing.
1.6.2.2聽聽 聽 Reasonable notice of meetings confirming the venue, time and date, together with an agenda of items to be discussed, shall be forwarded timeously to each member of the committee, and any other person required to attend the meeting.
1.6.2.3聽聽聽 The committee must meet with internal auditors and external auditors at least once a year without management being present.
1.6.2.4聽聽 聽 Meetings in addition to those scheduled may, with approval of the chairman, be held at the request of the external auditor, the chief executive officer, chief financial officer, internal auditor or other members of senior management or at the instance of the Board.
1.6.3聽 Attendance
1.6.3.1聽聽聽 Committee members shall attend all scheduled meetings of the committee, including meetings called on an ad hoc-basis for special matters, unless prior apology, with reasons, has been submitted to the chairman or company secretary.
1.6.3.2聽聽聽 If the nominated chairman of the committee is absent from a meeting, the members present must elect one of the members present to act as chairman.
1.6.3.3聽 聽聽 The chief executive officer, chief financial officer, internal auditor, representatives from the external auditors, other assurance providers, professional advisors and Board members may be in attendance at committee meetings, but by invitation only and they may not vote.
1.6.3.4聽聽聽 Any member of the 力博体育 Board has the right to attend and be heard at committee meetings.
1.6.3.5聽聽 聽 The members of the Board, the chief executive officer, chief financial officer, risk executive, the external auditors and the internal auditor shall have unrestricted access to the chairperson or any other member of the committee in relation to any matter falling within the remit of the committee.
1.6.4聽 Quorum
1.6.4.1聽 聽 The quorum for decisions of the committee shall comprise any two members of the committee.
1.6.4.2聽聽聽 The committee members and attendees will, where possible, work by consensus.
1.6.4.3聽聽聽 Only committee members shall be entitled to vote.
1.7聽聽聽聽聽聽聽聽聽 Remuneration
1.7.1聽聽聽 Having regard to the functions performed by the members of the committee in
2聽聽聽聽聽聽聽聽聽 Duties
addition to their functions as directors and in relation to the activities of the committee and pursuant to the specific power conferred upon the Board by the articles of incorporation of the company, members of the committee shall be paid such special remuneration in respect of their appointment as shall be determined by the Board.
1.7.2聽聽聽聽 The chairman of the committee shall, in addition to his/her remuneration as a member, receive a further sum as determined by the Board.
1.7.3聽聽聽聽 Such special remuneration in terms hereof shall be in addition to the annual fees payable to directors.
2.1聽聽聽聽聽聽 Statutory duties
The committee must:
2.1.1聽聽聽聽聽 聽聽nominate for appointment an independent registered auditor who in the opinion of the committee is independent of the company;
2.1.2聽聽聽聽聽聽 determine the fees to be paid and the terms of engagement of the auditor;
2.1.3聽聽聽聽聽 聽ensure that the appointment of the auditor complies with the Companies Act and other relevant legislation;
2.1.4聽聽聽聽聽 聽determine the nature and extent of any non-audit services which the auditor may provide to the company, or that the auditor must not provide to the company, or a related company;
2.1.5聽聽聽聽聽 develop 聽a 聽policy 聽to 聽govern 聽any 聽non-audit 聽services rendered聽 by 聽the 聽external 聽auditor/s 聽in 聽order 聽to 聽ensure 聽that 聽any 聽non-audit services will not impair the independence of the external auditor/s;
2.1.6聽聽聽聽聽聽 as a minimum, provide the following in the integrated report:
2.1.6.1聽聽聽聽 a description of how the committee carried out its functions;
2.1.6.2聽 聽聽 state whether the committee is satisfied that the auditor was independent of the company;
2.1.6.3聽聽 comment in any way the committee considers appropriate on the financial statements, the accounting practices and the internal financial control of the company;
2.1.6.4聽聽聽聽 a summary of the role of the committee;
2.1.6.5聽聽聽 a statement on whether or not the committee has adopted formal terms of reference that have been approved by the Board and whether the committee has satisfied its responsibility for the year in compliance with the terms of reference;
2.1.6.6聽聽聽 聽 the names and qualifications of all members of the committee;
2.1.6.7聽聽聽 聽the number of committee meetings held during the period under review and members attendance at these meetings;
2.1.6.8聽 聽聽 a statement on whether or not the committee considered and recommended the internal audit terms of reference for approval by the Board;
2.1.6.9聽聽聽聽 a description of the working relationship with the internal auditor;
2.1.6.10聽 聽information聽 聽about聽 聽any聽 聽other聽 聽responsibilities聽 聽assigned聽 聽to聽 聽the committee by the Board;
2.1.6.11聽 a statement on whether the committee complied with its legal, regulatory or other responsibilities; and
2.1.6.12 a statement on whether or not the audit and risk committee recommended the integrated report to the Board for approval.
2.1.7聽 receive and deal appropriately with any concerns or complaints, whether from within or outside the company or on its own initiative, relating to:
2.1.7.1聽聽聽 the accounting practices and internal audit of the company;
2.1.7.2聽聽聽 the content or auditing of the company鈥檚 financial statements;
2.1.7.3聽聽聽 the internal financial controls of the company; or
2.1.7.4聽聽聽聽 any related matter.
2.1.8聽 聽 make submissions to the Board on any matter concerning the company鈥檚 accounting policies, financial control, records and reporting;
2.1.9聽聽 聽perform any other functions determined by the Board, including the development and implementation of a policy and plan for a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes within the company; and
2.1.10 聽 in addition, as a listed entity, consider, on an annual basis, and satisfy itself of the appropriateness of the expertise and experience of the chief financial officer and the company must confirm this by reporting to shareholders in its annual report that the audit and risk committee has executed this responsibility.
2.2聽聽聽聽聽聽 Delegated duties
2.2.1聽聽聽 External assurance
The audit and risk committee shall:
2.2.1.1 meet with the auditor at the commencement of the audit to review and approve the annual audit plan and ensure that it is consistent with the scope of the audit engagement;
2.2.1.2 be satisfied that the audit plan makes provision for effectively addressing the critical risk areas in the business;
2.2.1.3 meet with the auditor at least 聽a month (or such other time period as is required and directed by the committee in consultation with the auditor) before the Board meets to approve the financial statements in order to consider matters which appear 聽to 聽the 聽auditor 聽or 聽the 聽audit 聽and 聽risk 聽committee 聽to 聽be 聽of importance and relevant to the proposed financial statements and to the affairs of the company generally;
2.2.1.4 review the findings of the audit with the auditor, this shall include but not be limited to the following:
鈥撀犅� a discussion of any major issues which arose during the audit;
鈥撀犅� any accounting and audit judgments; and
鈥撀犅� levels of errors identified during the audit;
2.2.1.5聽聽 聽provide an open avenue of communication between the external auditor, internal audit and the Board;
2.2.1.7聽聽 聽consider the appropriateness and quality of all critical accounting policies and practices including any accounting treatments, significant unusual transactions or accounting judgments that could be contentious;
2.2.1.7聽聽 聽review any representation letters requested by the auditor before they are signed by management;
2.2.1.8聽 聽聽 review the management letter and management鈥檚 response to the auditor鈥檚 findings and recommendations;
2.2.1.9聽聽 聽review the overall audit role, minimise duplication, discuss implications of new auditing standards and ensure that the external audit fee will sustain a proper audit and provide value for money;
2.2.1.10 聽 ensure that there is a process for the audit and risk committee to be informed of any irregularities identified and reported by the external auditor;
2.2.1.11 聽 ensure that the lead engagement partner within the appointed firm is rotated every five years in accordance with current requirements; and
2.2.1.12聽 review the quality and effectiveness of the external audit process, and evaluate the performance of the auditor;
2.2.1.13聽聽 Oversee that there is assurance over externally reported tax matters.
2.2.2 Financial statements
The committee will review the annual financial statements, the interim, preliminary or provisional result announcements, the accompanying reports to shareholders and any other announcements regarding the company鈥檚 results or other financial information to be made public, prior to submission and approval by the Board.
This will be focused particularly on:
2.2.2.1聽聽 聽the impact of significant or new financial systems;
2.2.2.2聽聽 聽tax and litigation matters;
2.2.2.3聽聽 聽the appropriateness of accounting policies adopted and any changes in accounting policies and compliance practices;
2.2.2.4聽聽 聽significant financial estimates based on judgment which are included in the financial statements;
2.2.2.5聽 聽聽 the impact and disclosure of significant, complex and/or unusual transactions, especially where the accounting treatment is open to different interpretations;
2.2.2.6聽聽 聽the appropriateness of major adjustments processed at year-end;
2.2.2.7聽聽 the basis on which the company and the 力博体育 group had been determined a going concern;
2.2.2.8 聽聽聽聽compliance with International Financial Reporting Standards (IFRS) and ASX Listing requirements;
2.2.2.9聽聽 聽compliance with applicable legal requirements;
2.2.2.10 聽 whether the annual financial statements present a balanced and understandable assessment of the company鈥檚 position, performance and prospects;
2.2.2.11 聽the 聽clarity of 聽disclosure 聽in 聽the 聽company鈥檚聽 financial 聽reports 聽and 聽the context in which statements are made;
2.2.2.12 聽 reviewing the directors鈥� report to be included in the annual financial statements, including the statement on effectiveness of the systems of internal control;
2.2.2.13 聽 compliance with the financial conditions of loan covenants;
2.2.2.14聽聽 reviewing special documents such as prospectuses as and when prepared; and
2.2.2.15 聽 earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies.
2.2.3聽聽聽聽聽 Integrated reporting
The committee shall oversee integrated reporting. In particular the committee shall:
2.2.3.1聽聽 聽have regard to all factors and risks that may impact on the integrity of the integrated report, including factors that may impact fair presentation of the significant judgments and reporting decisions made, monitoring or enforcement actions by a regulatory body, any evidence that brings into question previously published information, forward-looking statements or information;
2.2.3.4聽聽 聽 review the annual financial statements, interim reports, preliminary or provisional result announcements, summarised integrated information, any other intended release of price sensitive information and prospectuses, trading statements and similar documents;
2.2.3.4聽聽 聽 comment in the annual financial statements on the financial statements, the accounting practices and the effectiveness of the internal financial controls;
2.2.3.5聽聽 聽review the disclosure of sustainability issues in the integrated report to ensure that it is reliable and does not conflict with the financial information;
2.2.3.6聽聽 聽recommend 聽to 聽the 聽Board 聽whether 聽or 聽not 聽to 聽engage 聽an 聽external assurance provider on material sustainability issues;
2.2.3.7聽聽 聽 recommend the integrated report for approval by the Board;
2.2.3.8聽聽 聽consider the frequency for issuing company results;
2.2.3.9聽聽 聽consider聽 聽whether聽 聽the聽 聽external聽 聽auditor聽 聽should聽 聽perform聽 聽assurance procedures on the company results;
2.2.3.10 聽 review the content of the summarised financial information for whether it provides a balanced view; and
2.2.3.11 聽 engage the external auditors to provide assurance on the summarised financial information;
2.2.3.12聽聽 review the disclosure of tax compliance with regard to approved tax policy, tax approach, tax risk and opportunity management and tax contribution.
2.2.4聽聽聽 Combined assurance
The committee shall ensure that a combined assurance model is applied to provide a coordinated approach to all assurance activities, and in particular the committee shall:
2.2.4.1聽聽 聽ensure that the combined assurance received is appropriate to address all the significant risks facing the company; and
2.2.4.2聽聽 聽monitor the relationship between the external assurance providers of the company.
2.2.5聽 聽Risk oversight
The key role with respect to risk is to assist the Board to ensure that the company has implemented an effective policy and plan for risk management that will enhance the company鈥檚 ability to achieve its strategic objectives. Furthermore, to assist the Board to ensure the disclosure regarding risk is comprehensive, timely and relevant.
The committee is an integral component of the risk management process and specifically the committee shall:
2.2.5.1聽聽 聽oversee financial reporting risks;
2.2.5.2聽聽 聽oversee internal financial controls;
2.2.5.3聽聽 聽oversee fraud risks as it relates to financial reporting;
2.2.5.4聽聽 聽oversee information technology risks as it relates to financial reporting;
2.2.5.5聽聽聽 oversee the development and annual review of a policy and plan for risk management to recommend for approval to the board;
2.2.5.6聽聽 聽monitor implementation of the policy and plan for risk management taking place by means of risk management systems and processes;
2.2.5.7聽聽 聽make recommendations to the board concerning levels of tolerance and appetite and monitoring that risks are managed within the levels of tolerance and appetite as approved by the board.
2.2.6聽 聽Internal audit
The committee is responsible for overseeing internal audit and, in particular, the committee shall:
2.2.6.1聽 聽 be responsible for the appointment, performance assessment and/or dismissal of the internal auditors;
2.2.6.2聽聽 聽approve the internal audit plan;
2.2.6.3聽聽 聽oversee the staffing and objectives of the function;
2.2.6.4聽聽 聽ensure that the internal audit function is subject to an independent quality review, as and when the committee determines it appropriate;
2.2.6.5聽聽 聽review and approve the internal audit terms of reference;
2.2.6.6聽 聽聽 consider and review, with management and the internal auditors, significant findings during the year and management鈥檚 responses thereto in relation to reliable reporting, corporate governance and adequate and effective internal control;
2.2.6.7聽聽 聽ensure that the internal audit function has the necessary resources and access to information to enable it to fulfill its programme and to perform its duties in accordance with the appropriate professional standards for internal auditors;
2.2.6.8聽聽 聽ensure that the internal audit objectives and goals, staffing, budgets and plans provide adequate support for the goals and objectives of the audit and risk committee, as well as for the fulfilment of the internal audit charter;
2.2.6.9聽 review the co-operation and co-ordination between the internal and external audit functions and coordinating the formal internal audit work plan with external auditors to avoid unnecessary duplication of work;
2.2.6.10 聽review significant differences of opinion between management and the internal audit function;
2.2.6.11 聽monitor the maintenance of proper and adequate accounting records;
2.2.6.12 聽monitor 聽the 聽overall 聽operational 聽and 聽financial 聽reporting 聽environment;
2.2.6.13 聽monitor and evaluate the performance of the internal audit function in terms of agreed goals and objectives;
2.2.6.14 聽consider and review any difficulties encountered in the course of the audits, including any restrictions on the scope of internal audit鈥檚 work or access to required information;
2.2.6.15 聽consider any changes required in the planned scope of the internal audit coverage.
2.2.7聽聽聽聽聽 Compliance with laws and regulations
The committee is responsible for overseeing the compliance management function.
The committee shall:
2.2.7.1聽聽聽聽 approve the compliance policy;聽聽 聽
2.2.7.2聽聽聽聽 review and oversee the effectiveness of the system for monitoring compliance with laws and regulations within the business and the results of management鈥檚 investigation and follow-up of any instances of non-compliance;
2.2.7.3聽聽 聽聽annually approve the compliance assurance plan;
2.2.7.4聽聽聽聽 receive and consider amendments to material legislation, codes and regulatory requirements;
2.2.7.5 聽聽review the findings of any examinations by regulatory agencies, and any auditor observations;
2.2.7.3聽 聽聽 obtain regular updates from the executives responsible for compliance matters, including tax compliance, litigation, disputes and claims;
2.2.7.4聽聽 聽 obtain reports from management, the internal auditor and the external auditor regarding compliance with all applicable legal and regulatory requirements.
2.2.8聽聽聽聽聽 Finance function
The committee shall review the expertise, resources and experience of the company鈥檚 finance function, and disclose the results in the integrated report.
2.2.9聽聽聽聽聽 Ethics and governance
The committee shall assist with the establishment of a clearly defined and documented code of ethics, giving due cognisance to the various statutory, common law and other requirements that cover the ethical behaviour of the directors and employees of 力博体育.
The committee will be responsible for:
2.2.9.1聽聽 聽reviewing any statements on ethical standards or requirements for 力博体育 and assisting in developing the standards and requirements;
2.2.9.2聽聽 聽ensuring that adequate systems exist to monitor and report on adherence to and offences against, including steps to prevent their recurrence:
鈥撀犅犅� these terms of reference;
鈥撀犅犅� 力博体育 code of ethics;
鈥撀犅犅� the articles of incorporation;
鈥撀犅犅� the relevant laws and the regulations that govern 力博体育鈥� operations and business conduct; and
鈥撀犅犅� 力博体育鈥� social, safety, health and environmental policies and practices;
2.2.9.3聽 聽聽 making recommendations on any potential conflict of interest or questionable situation of a material nature;
2.2.9.4聽聽 聽 reviewing any significant cases of employee conflicts of interest, misconduct or fraud, or any other unethical activity by 力博体育鈥� employees or, where 力博体育鈥� is affected, other relevant stakeholders;
2.2.9.5聽聽 聽 ensuring that appropriate procedures exist to monitor directors鈥� declarations on the nature and extent of their interest in contracts and on the extent of their interests and dealings in 力博体育鈥� shares; and
2.2.9.6聽 聽 reviewing and confirming the approach adopted by 力博体育 in relation to irregularities, agreeing the policy on:
鈥撀犅犅犅� the auditors obligation to report such matters;
鈥撀犅犅犅� how the requirement affects the 力博体育 group, and
鈥撀犅犅犅� action that the 力博体育 audit and risk committee and Board should consider and take.
The code of ethics will be reviewed and recommended to the Board for approval.
3聽聽聽聽聽聽聽聽聽 General
3.1聽聽聽聽聽 聽With respect to reporting and recommendations, the committee is required to report its activities to the full Board of Directors on a regular basis and to make such recommendations with respect to the above and other matters as the audit and risk committee may deem necessary or appropriate.
3.2聽聽聽聽聽 聽The committee shall establish a process whereby the effectiveness of the committee and its members is evaluated on an ongoing basis and the performance evaluation shall compare the performance of the audit and risk committee with the requirements of these terms of reference.
3.3聽聽聽聽聽 聽 The performance evaluation shall also recommend to the Board any improvements to the audit and risk committee鈥檚 terms of reference deemed necessary or desirable by the audit and risk committee. The performance evaluation by the audit and risk committee shall be conducted in such manner as the audit and risk committee deems appropriate. The report to the Board may take the form of an oral report by the chairperson of the audit and risk committee or any other member of the audit and risk committee designated by the audit and risk committee to make such report.
3.4聽聽聽聽聽 聽 The 聽ongoing 聽training 聽and 聽education 聽needs 聽of 聽the 聽committee 聽members 聽shall 聽be established on an annual basis and shall be provided at 力博体育鈥� expense, as well as any ad hoc needs and requirements that may arise from time to time, to ensure:
3.4.1聽聽 聽the committee is financially literate and up-to-date with current developments in accounting, auditing, corporate governance, risk management, ethics, taxation and other related financial issues;
3.4.2聽聽 聽the committee remains abreast of developments in the industry and economy within which 力博体育 operates; and
3.4.3聽聽 聽at least one member of the committee is fully proficient in understanding the implications of current and planned accounting and auditing standards.
3.5聽聽聽聽聽聽 The committee shall make recommendations concerning the levels of risk appetite and tolerance (including risk-bearing capacity) regarding the risks within the ambit of the committee.
3.6聽聽聽聽聽聽 The committee shall monitor management鈥檚 implementation of appropriate risk responses.
3.7聽聽聽聽聽聽 The committee shall, with regard to information and communication technology (ICT):
3.7.1 oversee ICT and information governance, which includes but is not limited to the approval and implementation of policies;
3.7.2聽 ensure that ICT is aligned with the performance and sustainability objectives of the company;
3.7.3聽 monitor and evaluate significant ICT investments and expenditure;
3.7.4聽 ensure that ICT forms an integral element of the company鈥檚 risk management;
3.7.5聽 ensure that ICT assets and company information are effectively managed to achieve strategic objectives.
The committee will consider any other relevant matters referred to it by the Board.