GUIDANCE NOTE 101017 October 2010 ICSA Guidance on Terms of Reference Audit Committee Contents If using online, click on the headings below to go to the related sections. A Introduction B The UK Corporate Governance Code C Notes on the terms of reference D Model terms of reference Page 1 GUIDANCE NOTE 101017 October 2010 A Introduction This guidance note proposes model terms of reference for the audit committee of a company seeking to comply fully with the requirements of the UK Corporate Governance Code, published June 2010 (the Code). It draws on the experience of company secretaries and is based on best practice as carried out in some of the UK’s top listed companies. Companies with additional primary listing(s) may need to amend the terms of reference in light of additional requirements in the relevant country, in particular the US Sarbanes-Oxley Act. B The UK Corporate Governance Code The Code states that: ‘The board should establish formal and transparent arrangements for considering how they should apply the corporate reporting and risk management and internal control principles and for maintaining an 1 appropriate relationship with the company’s auditor.’ It goes on to clarify that, in practical terms, this means that: ‘The board should establish an audit 2committee...’. The Code recommends that the main role and ...
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