Suggestions to improve functioning

Best practices being adopted

Problems being faced by Chairman/Members of Audit Committees

Tips for discharging responsibilities in effective manner

Functioning of Audit Committee in CPSEs


Department of Public Enterprises

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5 thoughts on “Functioning of Audit Committee in CPSEs

  1. Audit committee should not only audit finance part but also audit process wherein raw material consumption, power consumption
    Etc can be audited.

    1. Audit committee shall focus on working capital cycle duration and suggest ways & means to reduce it. Similarly Non performing Assets i.e assets/activities/services not having impact on the bottom line needs to be identified and the same should be removed/reduced/controlled. ATR to be prepared at the end of each AC meeting and the same shall be followed meticulously.

  2. The Audit meet you are referring to is primarily for the quarterly results wherein the Audit committee has to recommend the same to the Board. Since there is a danger of the results getting leaked out and the audit committee gets blamed for it (in listed companies, i.e.), it may be better to continue the present practice.

    However, the Audit Committee has a numbe of othe rroles to play. Chief among them is the Internal audit function, Risk analysis and management, robustness of the accounting & reporting processes, and some othe functions which the Chairman if the AUdit Committee is responsible for. To do justce to these responsibilities, it is better to delink the Audit Meeting from the Board Meeting.

    1. There is no requirement that the Audit Committee Meeting has to be held along with the Board Meeting. It is scheduled in that manner for ease of logistics. The Audit Committee Members can always request the Company to schedule a Meeting, at a time of their choice, subject to mutual convenience.

  3. Currently the Audit Committee meet just before the Board meeting without any time to discuss the issues. Why can’t it be made mandatory that the Audit Committee should be atleast 24hrs before the Board meeting?

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