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The Audit and Actuarial Committee reviews the annual financial statements, recommends the appointment of the external auditors and the independent actuary, and receives their reports. It also receives the reports of the internal auditor and the reports of the general counsel concerning compliance with the Code of Business Conduct.
Authority
Primary responsibility for the financial reporting, accounting systems and internal controls is vested in senior management and is overseen by the Board. The Audit and Actuarial Committee is a standing committee of the Board established to assist it in fulfilling its responsibilities in this regard including external financial reporting and actuarial valuations. The external actuary, external auditor and internal auditor are directly accountable to the Committee and to the Board of Directors.
The Committee shall have unrestricted access to all personnel and documents. The external actuary, the external auditor and the internal auditor shall have direct access to the Committee at all times.
The Committee is authorized to engage independent counsel and other advisors as it determines necessary to carry out its duties, and to set and pay the compensation for any advisors employed by the Committee.
Responsibilities
Financial Information
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|  | Review the annual financial statements and recommend their approval to the Board members, after discussing the statements and matters such as the selection of and/or changes in accounting policies, the quality of accounting principles, major accounting judgments, accruals, actuarial assumptions, valuations and estimates with management, the external actuary and the external auditor and amongst members of the Committee.
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| | Review other financial information included in the Annual Report.
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| | Review the Management Discussion and Analysis (MD&A) in the Annual Report.
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| | Directly oversee the work of the external actuary, including:
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| | considering the recommendations of the actuary as to the assumptions to be used in the valuations;
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| | reviewing the actuarial valuations and recommending their acceptance to the Board;
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| | the management letter together with management’s response;
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| | assessing the actuary’s performance;
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| | recommending the actuary for appointment by the Board as well as a fee for approval by the Board;
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| | meeting privately with the actuary to discuss pertinent matters.
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| | Directly oversee the work of the external auditor, including:
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| | the auditor’s engagement letter;
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| | the scope of the audit, including materiality, areas of audit risk, timetable, deadlines and co-ordination with internal audit;
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| | the post-audit management letter together with management’s response;
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| | the form of the audit report;
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| | any other audit, review or attest services;
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| | receiving the external auditor’s written statement of relationship with the Corporation including non-audit services performed by the auditor;
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| | assessing the auditor’s objectivity, independence and past performance;
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| | assessing the working relationship with management;
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| | resolving disagreements between management and the auditor regarding financial reporting;
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| | recommending the auditor for appointment by the Board as well as a fee for approval by the Board;
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| | meeting privately with the auditor to discuss pertinent matters, including the quality of personnel; and
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| | when necessary, recommending the removal of the external auditor.
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| | Review the annual Financial Plan including the Administrative Expense Budget and the Capital Budget for approval by the Board.
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| | Review of quarterly financial information.
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| | Assess annually the procedures in place for the review of the Corporation’s public disclosure of financial information extracted or derived from the financial statements.
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Accounting Systems and Internal Controls
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| | Obtain reasonable assurance from discussions with and/or reports from management, and reports from external and internal auditors that the Corporation’s accounting systems are reliable and the internal controls are operating effectively.
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| | Direct the auditors’ examinations to particular areas.
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| | Request the auditors to undertake special examinations.
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| | Review control weaknesses identified by the external and internal auditors, together with management’s response.
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| | Review of Quarterly Operations Risk Reports.
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Audit Services
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| | Review and approve the terms of reference of the internal audit function on a biennial basis.
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| | Review the appointment of the Vice-President, Audit Services.
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| | Review and approve the annual audit plan which includes the resources, budget and planned activities of the internal audit function.
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| | Review internal audit findings and determine that they are being properly followed up.
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| | Meet privately with the Vice-President, Audit Services to discuss pertinent matters.
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Corporate Governance Matters
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| | Investigate fraud, illegal acts or conflicts of interest alleged to have occurred within the Corporation.
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| | Approve, as provided in the Consulting Fees Policy, proposed expenditures on consultants and receive reports thereon from management.
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| | Review reports on compliance with statutory and regulatory obligations, including securities regulatory reports, remittance of income taxes and other payroll withholdings.
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| | Review reports on compliance with the Code of Business Conduct.
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| | Establish procedures for receiving and dealing with complaints received by the Corporation regarding accounting, internal accounting controls, financial reporting, or auditing matters. Ensure a procedure for receipt of confidential, anonymous submission by employees of the Corporation of concerns regarding questionable accounting, internal accounting controls, or auditing matters.
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| | Review and approve the hiring policy regarding partners, employees and former partners and employees of the present and former external auditor.
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| | Meet privately with management to discuss pertinent matters.
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| | Meet privately at each meeting of the Committee to discuss pertinent matters.
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| | Review the Terms of Reference of the Audit and Actuarial Committee on a biennial basis.
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Other Matters
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| | Review the appointment of the Vice-President, Finance.
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| | Advise the Board and carry out such other tasks, consistent with the above matters, as directed by the Board.
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Position description for the Chair of the Audit and Actuarial Committee
The Chair of the Committee shall:
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| | Provide leadership to enhance the Committee’s effectiveness by
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| | ensuring that the areas of responsibilities of the Committee and management are understood and respected by both; and
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| | overseeing the discharge of the Committee’s responsibilities including its reporting to the Board.
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| | Act as the liaison between the Board and management by working with the Chief Executive Officer or his delegatee
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| | to carry out the annual calendar of the Committee’s business;
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| | to set the agenda for each Committee meeting; and
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| | to ensure that proper information is brought to the Committee including regular management reports and documentary materials in support of financial information, internal controls and actuarial valuations.
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