Objective
The Audit Committee assists the Board in its responsibility
for overseeing the quality and integrity of the accounting,
auditing and reporting practices of the Company and its
compliance with the legal and regulatory requirements. The
Committee's purpose is to oversee the accounting and
financial reporting process of the Company, the audits of
the Company's financial statements, the appointment,
independence, performance and remuneration of the statutory
auditors including the Cost auditors, the performance of
internal auditors and the Company's risk management
policies.
A. Powers of the Committee:
- To investigate any activity within its terms of
reference.
- To seek information from any employee.
- To obtain outside legal or other professional advice.
- To secure attendance of outsiders with relevant
expertise, if it considers necessary.
B. Terms of Reference of the Committee:
Oversight of the Company’s financial reporting process and
the disclosure of its financial information to ensure that
the financial statement is correct, sufficient and credible;
Recommend appointment, remuneration and terms of appointment
of auditors, including cost auditors, of the Company;
Approval of payment to statutory auditors, including cost
auditors, for any other services rendered by them;
Review with the management, the annual financial statements
and auditor's report thereon before submission to the Board
for its approval, with particular reference to:
- a) matters required to be included in the Directors’
responsibility statement to be included in the Board’s
report in terms of clause (c) of sub-section (3) of
Section 134 of the Companies Act, 2013;
- b) changes, if any, in accounting policies and practices
and reasons for the same;
- c) major accounting entries involving estimates based on
the exercise of judgement by management;
- d) significant adjustments made in the financial
statements arising out of audit findings;
- e) compliance with listing and other legal requirements
relating to financial statements;
- f) disclosure of any related party transactions;
- g) modified opinion(s) in the draft audit report.
Review with the management, the quarterly financial
statements before submission to the Board for approval;
Review with the management, the statement of uses/
application of funds raised through an issue (public issue,
rights issue, preferential issue, etc.), the statement of
funds utilised for the purposes other than those stated in
the offer document/prospectus/notice and the report
submitted by the monitoring agency monitoring the
utilisation of proceeds of a public or rights issue, and
making appropriate recommendations to the Board to take up
steps in this matter;
Approval or any subsequent modification of transactions with
related parties of the Company;
Scrutiny of inter-corporate loans and investments;
Valuation of undertakings or assets of the Company, wherever
it is necessary;
Evaluation of internal financial controls and risk management
systems;
- a) Review with the management, performance of statutory
and internal auditors.
- b) Review with the management adequacy of the internal
control systems.
Review the adequacy of internal audit function, if any,
including the structure of the internal audit department,
staffing and seniority of the official heading the
department, reporting structure coverage and frequency of
internal audit;
Discuss with internal auditors any significant findings and
follow-up thereon;
Review the adequacy of internal audit function, if any,
including the structure of the internal audit department,
staffing and seniority of the official heading the
department, reporting structure coverage and frequency of
internal audit;
Look into the reasons for substantial defaults, in the
payment to the depositors, debenture holders, shareholders
(in case of non-payment of declared dividends) and
creditors;
Review the functioning of the Whistle Blower mechanism /
oversee the vigil mechanism;
Approval of appointment of Chief Financial Officer after
assessing qualifications, experience and background, etc. of
the candidate;
Mandatorily review the following:
- a) Management Discussion and Analysis of financial
condition and results of operations;
- b) Statement of significant related party transactions
(as defined by the Audit Committee), submitted by
management;
- c) Management letters / letters of internal control
weaknesses issued by the statutory auditors;
- d) Internal audit reports relating to internal control
weaknesses;
- e) Appointment, removal and terms of remuneration of the
chief internal auditor
- f) Statement of deviations:
- (a) quarterly statement of deviation(s)
including report of monitoring agency, if
applicable, submitted to stock exchange(s) in
terms of Regulation 32(1) of the Securities and
Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015
(Listing Regulations);
- (b) annual statement of funds utilised for
purpose other than those stated in the offer
document / prospectus in terms of Regulation
32(7) of the Listing Regulations;
Review financial statements, in particular the investments
made by the Company’s unlisted subsidiaries;
Note report of compliance officer as per SEBI (Prohibition of
Insider Trading) Regulations, 2015;
Formulate the scope, functioning, periodicity of and
methodology for conducting the internal audit;
Review show cause, demand, prosecution notices and penalty
notices, which are materially important;
Review any material default in financial obligations to and
by the Company, or substantial non-payment for goods sold by
the Company;
Review any issue, which involves possible public or product
liability claims of substantial nature, including any
judgement or order which, may have passed strictures on the
conduct of the Company or taken an adverse view regarding
another enterprise that may have negative implications on
the Company;
Details of any joint venture or collaboration agreement;
Sale of investments, subsidiaries, assets which are material
in nature and not in normal course of business;
Quarterly details of foreign exchange exposures and the steps
taken by management to limit the risks of adverse exchange
rate movement, if material;
Review the utilisation of loans and / or advances from /
investment by the holding company in the subsidiary
exceeding Rs.100 crore or 10% of the asset size of the
subsidiary, whichever is lower including existing loans /
advances / investments;
Carry out any other function as is mandated by the Board from
time to time and / or enforced by any statutory
notification, amendment or modification as may be
applicable.