It’s a board committee whose core mandate is to ensure that internal controls are established and effectively maintained to achieve a Sacco’s financial reporting objectives. Its other duties include:
Ensuring that internal controls are established and effectively maintained to achieve a Sacco’s financial reporting objectives.
Reviewing internal controls including the scope of the internal audit program, the internal audit findings, and recommend action to be taken by management;
Reviewing internal audit reports and their overall effectiveness, the scope and depth of audit coverage, reports on internal controls and any recommendations and confirm that appropriate action has been taken;
Ensuring that accounting records and financial reports are promptly prepared to accurately reflect operations and result;
Reviewing co-ordination between the internal and external audit functions as well as monitor the external auditor’s independence and objectivity taking into consideration relevant professional and regulatory requirements;
Nominating names of external auditors from a list gazetted by the commissioner of Co-operatives for appointment by the Annual General Meeting;
Reviewing with external auditors the scope of their annual audit plan, systems of internal audit reported, assistance given by management to the auditors and any findings and actions taken, and recommend the auditor’s remuneration to the Board;
Reviewing management reports and reports from the internal and external auditors concerning deviations and weaknesses in accounting and operational controls;
Reviewing the Sacco Society’s internal audit plan, with specific reference to the procedures for identifying regulatory risks and controlling the impacts on the Sacco Society, including receiving correspondence from the Authority and management’s responses;
Monitoring the ethical conduct of the Sacco Society and consider the development of ethical standards and requirements, including effectiveness of procedures for handling and reporting complaints;
Reviewing any related party transactions that may arise within the Sacco Society;
Ensuring that relevant plans, policies, and control procedures are established and properly administered;
Ensuring that policies and control procedures are sufficient to safeguard against error, carelessness, conflict of interest, self-dealing and fraud;
Investigating members’ complaints;
Considering any matter of significance raised at the Annual General meeting.
Risk Management Tasks
Reviewing and assessing the integrity of the risk control systems and ensure that the risk policies and strategies are effectively managed.
Setting out the nature, role, responsibility and authority of the risk management function within the Sacco and outline the scope of risk management work.
Monitoring external developments connected to accountability of Saccos and the reporting of associated risk, including emerging and prospective impact and in doing so will take into account concerns raised by management in the Audit Committee and also issues relating to asset liability management, Sacco finances and business and strategic risk.