Corporate Governance/Audit Committee

AUDIT COMMITTEE - TERMS OF REFERENCE

Constitution

The Board has resolved to establish a Committee of the Board to be known as the Audit Committee on 23rd September, 2004.

Membership

The Audit Committee consists of three members.

Meetings

3.	Meetings of the Audit Committee shall be held not less than twice a year. The external auditors may request a meeting if they consider that is necessary.

4.	A quorum of the meeting shall be two members.

5.	Resolutions of the Committee at any meeting shall be passed by a majority of votes of members if more than two members are present and by a unanimous vote if only two members are present.

Authority

The Audit Committee shall have unrestricted access to other members of the board of directors (“Board”), senior management, the qualified accountant, internal controller and external auditors in execution of its duties and responsibilities. All relevant employees will be directed to co-operate with any request made by the Audit Committee.

The Audit Committee is authorised to obtain independent professional advice in accordance with the procedures adopted by the Company from time to time and to secure the attendance of any external professional with relevant experience and expertise if it considers necessary.

Responsibilities

The responsibilities of the Audit Committee is :-

Relationship with the Company’s auditors

to make recommendation to the board on the appointment, reappointment and removal of the external auditor and to approve the remuneration and terms of engagement of the external auditor, and any questions of resignation or dismissal of that auditor;

to review and monitor the external auditor’s independence and objectivity and the effectiveness of the audit process in accordance with applicable standard. The audit committee should discuss with the external auditor before the audit commences, the nature and scope of the audit and reporting obligations;

to develop and implement policy on the engagement of an external auditor to supply non-audit services;

Review of financial information of the Company

to monitor the integrity of financial statements and the annual report and accounts, half-year report and/or quarterly reports, and to review significant financial reporting judgements contained in them before submission to the Board, focusing particularly on:

i.	any changes in accounting policies and practices;
ii.	major judgmental areas;
iii.	significant adjustments resulting from the audit;
iv.	the going concern assumptions and any qualifications;
v.	compliance with accounting standards; and
vi.	compliance with Stock Exchange Listing Rules and other legal requirements in relation to financial reporting;

in relation to clause (d) above, the members of the committee shall liaise with the Company’s Board of directors, senior management and the qualified accountant and the committee shall meet, at least once a year, with the Company’s auditors;

in relation to clause (d) above, to consider any significant or unusual items that are, or may need to be, reflected in such reports and accounts and must give due consideration to any matters that have been raised by the issuer’s qualified accountant, compliance officer or auditors;

Oversight of the Company’s financial reporting system and internal control procedures

to review the Company’s financial controls, internal control and risk management systems;

to discuss with the management the system of internal control and ensure that management has discharged its duty to have an effective internal control system;

to consider any findings of major investigations of internal control matters as delegated by the Board or on its own initiative and management’s response;

to ensure co-ordination between the internal and external auditors, and to ensure that the internal audit function is adequately resourced and has appropriate standing within the Company, and to review and monitor the effectiveness of the internal audit function;

to review the group’s financial and accounting policies and practices;

to review the external auditor’s management letter, any material queries raised by the auditor to management in respect of the accounting records, financial accounts or systems of control and management’s response;

to ensure that the Board will provide a timely response to the issues raised in the external auditor’s management letter;

to report to the Board on any matters set out above; and

to consider other topics, as requested by the Board

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