The Committee of University Chairs (CUC) published its Higher Education (HE) Audit Committees Code of Practice (the Code) in May 2020.
Whilst there is no mandatory requirement for institutions to follow the Code, it clearly sets out good governance arrangements to ensure an audit committee functions in an effective manner.
Here are seven reasons why we welcome the introduction of the Code:
- The new Code is more succinct in comparison to the Handbook published in 2008, and will be reviewed as a minimum every four years.
- Whilst the key elements of the Handbook remain, this short but transparent document will enable audit committees to map their current arrangements easily.
- The Code brings clarity to the roles of audit committees, members and external parties.
- The Code reminds all of the need to ensure that members are selected based on their skills and the requirement to compliment the skills mix of the committee, but also on their contribution to an audit committee’s agenda.
- The Code reminds institutions that they should ensure members are provided with the relevant tools, such as strong inductions, administrative support for the committee and timely business cycles.
- The Code emphasises the importance of external and internal audit in the audit committee’s business, and the requirement of independent oversight.
- The commitment to regular updates to the Code is a positive move taking into account the continuous changing landscape, including funding pressures, Brexit, Covid-19 and increased competition - all of which will continue to provide challenges to institutions.
In short, the Code is a great addition that allows HE audit committees to consider and refocus on their roles and responsibilities at a time of great uncertainty and risk for the sector.
Please contact your local RSM advisor if you want further information or a member of the higher education team.