Audit and Risk Committee Charter
The Audit and Risk Committee (Committee’) is a committee that assists and advises the Board of Blackham Resources Ltd (‘the Company’), in the effective discharge of its responsibilities in the areas of statutory reporting, internal control systems, risk management systems, insurance and legal proceedings and the external audit function.
The committee does not relieve any directors of their responsibilities for these matters.
This charter should be read in conjunction with items 13.18 to 13.24 (inclusive) of the Company’s constitution (‘Constitution’). To the extent there is any inconsistency between this charter and the Constitution, the Constitution shall prevail.
The Committee acts primarily as an advisory body to the Board and in making recommendations to the Board. The Committee does not, as of itself, have the power or authority of the Board in dealing with matters on which it advises except where certain powers are specifically set out in this Charter or are otherwise delegated by the Board.
Role and Objectives
(1) To monitor the integrity of the financial statements of the Company, reviewing significant financial reporting judgments. This will include, but not be limited to, the following:
• Assess the appropriateness of accounting policies, practices and disclosures and whether the quality of financial reporting is adequate;
• To review the half-year and annual financial statements before submission to the Board;
• To review the external auditor’s management letter and management’s response;
• Review any related party transactions;
• To consider any other topics as defined by the Board
(2) To review the Company’s internal financial control systems;
(3) Maintain open lines of communication between the Board, external auditors and the Company’s compliance officers;
(4) To consider the appointment of the external auditor and to approve the remuneration and terms of engagement of the external auditor;
(5) To monitor and review the external auditor’s independence, objectivity and effectiveness, taking into consideration relevant professional and regulatory requirements;
(6) To develop and implement policy on the engagement of the external auditor to supply non-audit services, taking into account relevant ethical guidance regarding the provision of non-audit services by the external audit firm.
(1) To ensure the development of an appropriate risk management policy framework that will provide guidance to management in implementing appropriate risk management practices throughout the Company’s operations, practices and systems;
(2) To define and periodically review risk management as it applies to the Company and clearly identify all the stakeholders;
(3) To ensure that the committee clearly communicate the Company’s risk management philosophy, policies and strategies to directors, senior executives, employees, contractors and other appropriate stakeholders;
(4) To ensure that directors and senior executives establish a risk aware culture which reflects the Company’s risk policies and philosophies;
(5) To review methods of identifying broad areas of risk and set guidelines for business risk reviews; and
(6) To consider capital raising, treasury and market trading activities with particular emphasis on risk treatment strategies, products and levels of authority.
The core components of the Company’s risk profile include, but are not limited to, the following:
• Strategic risk
• Market risk
• Operational risk
• Exploration risk
• Tenure risk
• Assets risk
• Economic risk
• Regulatory risk
• Sustainability risk (environment, OH & S and community relations)
The Committee will be comprised of at least three members all of whom shall be independent Non-executive directors. The Board will determine each director’s independence having regard to any past and present relationships with the Company which, in the opinion of the Board, could influence the director’s judgement.
The Chairman of the Committee shall be designated by the Board. In the event of a tied vote on any issue, the Chairman’s vote shall decide the issue. Should the Chairman be absent from a meeting, the members of the Committee shall choose one of their number to be Chairman for the particular meeting.
Each Member of the Committee must be financially literate and at least one member of the committee has accounting and/or finance related management expertise.
(1) Meetings shall be held as frequently as required but not less than twice a year. The external auditors may request a meeting if they consider that one is necessary. A quorum shall be two members.
(2) A representative of the external auditors may attend meetings by invitation. Other Board members shall also have the right of attendance.
(3) Minutes of all meetings of the committee are to be kept.
(4) Committee meetings will be governed by the same rules, as set out in the Company constitution and as they apply to the meetings of the Board.
(5) The Company Secretary shall be the Secretary of the committee.
(6) The committee will undertake an annual review to assess the adequacy of its Charter. As part of this annual review the committee will request a written statement from the external auditor delineating all relationships and services with the entity and others that might adversely impact, or be perceived to impact, on the external auditor’s independence.
The Managing Director and CFO shall be available to attend all Committee meetings. The Committee may invite such other members of the management team and such other people as it deems appropriate to attend the Committee and to provide information as necessary so that the Committee may be fully informed on the relevant matter.
The Committee acts within the scope of the responsibilities set out in this charter and any other responsibilities as delegated to the Committee by the Board. In carrying out its responsibilities the Committee may:
(i) seek any other information that it requires from any employee or external party;
(ii) obtain legal or other professional advice;
(iii) require the attendance of any Company employee, consultant or contractor at its meetings; and
(iv) do whatever else it considers necessary or desirable to carry out its responsibilities
Tenure, Performance and Evaluation
The terms of the members of the Committee will coincide with their terms on the Board, unless the Board determines otherwise.
The Committee shall review its charter and performance and that of its members from time to time and report to the Board on the results of any such review.
The members of the Committee will comply with the Company’s applicable Code of Conduct as amended from time to time.
Unless otherwise required by law or the Constitution, the members of the Committee are required to keep Committee discussions, committee papers and deliberations confidential.
(i) The Secretary shall circulate the minutes of meetings of the Committee to all members of the Committee and the Board.
(ii) The Chair of the Committee shall report on committee deliberations and recommendations to the next full Board meeting.
(iii) Other reporting requirements as directed by the relevant authorities.