|The AC meets with the external auditors, and with the internal auditors, in each case without the presence of management, at least annually.|
This Provision sets out that the AC should have private sessions with the internal and external auditors.
These private sessions should be held at least once a year and separately from each other.
The main objective of these sessions is to allow the internal and external auditors to speak freely with the AC on matters that may be difficult or sensitive to raise or to discuss in the presence of management (and the other auditors). These matters can include:
- The quality and competence of management (including the finance team).
- The tone at the top.
- The level of cooperation given to both the internal and external auditors in their respective audits.
- Issues, concerns, and areas of judgement encountered during the audit about accounting policies and their interpretations, taxation, risk management and internal controls.
- Any other concerns about the company, its processes, and/or its people.
- The re-appointment and resignation of the external auditor.
- The performance of the internal auditor (in the private session with the external auditor) and the external auditor (in the private session with the internal auditor).
B. Practice Guidance
C. Related Rules and Regulations
D. CG Guides
- AC Guide 4.5: The AC’s Engagement with the Internal Auditor [Internal Audit].
- AC Guide 5.4: AC Engagement with the External Auditor [External Audit].
- AC Guide Case Study 5B-1: Private Session with the External Auditor [External Audit].
- AC Guide Appendix 5G: Private Session with the External Auditor [External Audit].
E. Related Articles