TOR Audit Committee - National Refinery Limited

TERMS OF REFERENCE OF BOARD AUDIT COMMITTEE

(a) Determination of appropriate measures to safeguard the company’s assets;
(b) Review of preliminary announcements of results prior to external communication and publication;
(c) Review of quarterly, half-yearly and annual financial statements of the company, prior to their approval by the Board of Directors, focusing on:
• Major judgmental areas;
• Significant adjustments resulting from the audit;
• The going concern assumption;
• Any changes in accounting policies and practices;
• Compliance with applicable accounting standards;
• Compliance with the code of corporate governance regulations and other statutory and regulatory requirements; and
• All related party transactions.
(d) Facilitating the external audit and discussion with external auditors of major observations arising from interim and final audits and any matter that the auditors may wish to highlight (in the absence of management, where necessary);
(e) Review of management letter issued by external auditors and management’s response thereto;
(f) Ensuring coordination between the internal and external auditors;
(g) Review of the scope and extent of internal audit, audit plan, reporting framework and procedures and ensuring that the internal audit function has adequate resources and is appropriately placed;
(h) Consideration of major findings of internal investigations of activities characterized by fraud, corruption and abuse of power and management's response thereto;
(i) Ascertaining that the internal control systems including financial and operational controls, accounting systems for timely and appropriate recording of purchases and sales, receipts and payments, assets and liabilities and reporting structure are adequate and effective;
(j) Review of company’s statement on internal control systems prior to endorsement by the Board of Directors and internal audit reports;
(k) Instituting special projects, value for money studies or other investigations on any matter specified by the Board of Directors, in consultation with the Chief Executive and to consider remittance of any matter to the external auditors or to any other external body;
(l) Determination of compliance with relevant statutory requirements;
(m) Monitoring compliance with the code of corporate governance regulations and identification of significant violations thereof;
(n) Review of arrangement for staff and management to report to audit committee in confidence, concerns, if any, about actual or potential improprieties in financial and other matters and recommend instituting remedial and mitigating measures;
(o) Recommend to the Board the appointment of external auditors, their removal, audit fees, the provision of any service permissible to be rendered to the company by the external auditors in addition to audit of its financial statements, measures for redressal and rectification of non-compliances with the Regulations;
(p) Review and assist the Board, on governance and oversight of sustainability risks and opportunities, which includes the environmental, social and governance considerations, within the company, in setting the company’s sustainability strategies, priorities and targets to create long term corporate value;
(q) Review and recommend to the Board policies to promote diversity, equity and inclusion (DE&I) are in place to encourage gender mainstreaming, gender equality and the participation of women on the board, management and workforce of the company;
(r) Support the Board in proactively identifying, understanding, and overseeing the principal as well as the emerging sustainability risks and opportunities relevant to the company and its business, including climate-related risks and opportunities, assess their potential financial and operational impacts, and recommend strategies for management and mitigation thereof;
(s) Ensures that the company’s sustainability and DE&I related strategies, priorities and targets as well as performance against these targets are periodically reviewed and monitored;
(t) Monitor and review sustainability related risks and opportunities of the company, oversee compliance of relevant laws pertaining to relevant sustainability related considerations and its appropriate disclosures;
(u) Submit to the board a report, at least once a year, on embedding sustainability principles into the company's strategy and operations to increase corporate value;
(v) Review and recommend directors report that provide adequate disclosures regarding the assessment of sustainability related risks, how these are managed or mitigated, and measures taken to promote DE&I in the Company; and
(w) Consideration of any other issue or matter as may be assigned by the Board.