Belle International Holdings Limited
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TERMS OF REFERENCE FOR THE AUDIT COMMITTEE
(first adopted on 27 April 2007) (amended and re-adopted on 17 March 2012)
TERMS OF REFERENCE FOR THE AUDIT COMMITTEE
1 Constitution
1.1 The Audit Committee (the "Committee") was established in
2007 pursuant to a resolution passed by the board of
directors (the "Board") of Belle International Holdings
Limited (the "Company", and together with its subsidiaries
the "Group") at its meeting held on 27 April 2007.
1.2 These terms of reference were first approved and adopted
on 27 April 2007 and were amended, approved and re-adopted in
2012 pursuant to a resolution passed by the Board at its
meeting held on 17 March 2012.
2 Responsibility
2.1 The Committee is to serve as a focal point for
communication between other directors of the Board and
external auditors of the Company as regards their duties
relating to financial and other reporting, internal controls,
external audits and such other matters as the Board
determines from time to time.
2.2 The Committee is to assist the Board in fulfilling its
responsibilities by providing an independent review and
supervision of financial reporting, internal controls of the
Group, and adequacy of the external audits.
3 Membership
3.1 The Committee shall consist of not less than three
members appointed by the Board from time to time, all of whom
shall be non-executive directors and a majority of whom shall
be independent non-executive directors. At least one of the
independent non-executive directors from the Committee shall
have appropriate professional qualifications or accounting or
related financial management expertise as required under the
Rules Governing the Listing of Securities (the "Listing
Rules") on The Stock Exchange of Hong Kong Limited (the "Hong
Kong Stock Exchange").
3.2 The Board shall appoint the chairman of the Committee who
shall be an independent non-executive director.
3.3 A former partner of the Company's existing auditing firm
shall be prohibited from acting as a member of the Committee
for a period of 1 year from the date of his ceasing:
(a) to be a partner of the firm; or
(b) to have any financial interest in the firm, whichever is
later.
3.4 Appointments to the Committee shall be co-terminus with
the directorship of the relevant members (whether by
retirement, rotation or otherwise).
4 Secretary
4.1 The company secretary of the Company or his nominee shall
be the secretary of the Committee.
4.2 The secretary of the Committee must ensure that full
minutes are kept of all meetings.
5 Frequency and proceedings of meetings
5.1 The Committee shall meet at least two times every year.
Additional meetings should be held as the work of the
Committee demands.
5.2 The chairman of the Committee may convene additional
meetings at his discretion.
5.3 The quorum for a meeting shall be two members.
5.4 Proceedings of meetings of the Committee shall be
governed by the provisions of the articles of association of
the Company.
5.5 The chief financial manager and a representative of the
external auditors shall be, where appropriate, invited by the
Committee to attend the meetings.
5.6 Notice of Committee meetings shall be given to all
members. Notice of the Committee meetings shall be deemed to
be duly given to a member if it is given to him personally,
by word of mouth or given to him in writing sent to his last
known address or any other address given by him to the
Company or by electronic means by transmitting it to any
email address supplied by the member to the Company for this
purpose.
5.7 Meetings can be held in person, by telephone or by video
conference. Members may participate in a meeting by means of
communication equipment through which all persons
participating in the meeting are able to hear each other.
5.8 A resolution in writing signed by all members of the
Committee shall be as valid and effective as if the same had
been passed at a meeting of the Committee duly convened and
held. Any such resolution shall be deemed to have passed at a
meeting held on the date on which it was signed by the last
member to sign.
5.9 Only members of the Committee are entitled to vote at the
meetings.
5.10 Resolutions of the Committee shall be passed by a
majority of votes of the members present.
6 Authority
6.1 The Committee is authorised by the Board to act within
its terms of reference.
It is authorised to seek any information it requires from any
employee of the Company and all employees are directed to
co-operate with any request made by the Committee.
6.2 The Committee is authorised by the Board, subject to
prior discussion concerning the cost, to obtain outside legal
or other independent professional advice and to secure the
attendance of outsiders with relevant experience and
expertise if it considers necessary.
6.3 The Committee shall report to the Board any suspected
frauds and irregularities, failures of internal control or
suspected infringement of laws, rules and regulations which
come to its attention and are of sufficient importance to
warrant the attention of the Board.
6.4 Where the Board disagrees with the Committee's view on
the selections, appointment, resignation or dismissal of the
external auditors, the Committee will arrange for the
Corporate Governance Report in the Annual Report to include
an explanation of the Committee's view and the reason why the
Board has taken a different view.
6.5 The Committee shall be provided with sufficient resources
to perform its duties.
7 Duties
The Committee shall:
Relationship with the Company's auditors
7.1 be primarily responsible for making recommendations 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 its resignation or dismissal;
7.2 review and monitor the external auditor's independence
and objectivity and the effectiveness of the audit process in
accordance with applicable standards. The Committee shall
discuss with the external auditor before the audit commences,
the nature and scope of the audit and reporting obligations,
and ensure co-ordination where more than one audit firm is
involved;
7.3 develop and implement policy on engaging an external
auditor to supply non-audit services. For this purpose,
"external auditor" includes any entity that is under common
control, ownership or management with the audit firm or any
entity that a reasonable and informed third party knowing all
relevant information would reasonably conclude to be part of
the audit firm nationally or internationally. The Committee
shall report to the Board, identifying and making
recommendations on any matters where action or improvement is
needed;
Review of the Company's financial information
7.4 monitor integrity of the Company's financial statements
and annual report and accounts, half-year report and, if
prepared for publication, quarterly reports, and to review
significant financial reporting judgments contained in them.
In reviewing these reports before submission to the Board,
the Committee shall focus particularly on:
(a) any changes in accounting policies and practices; (b)
major judgmental areas;
(c) adequacy of disclosure, consistency within the financial
statements and with prior disclosures;
(d) significant adjustments resulting from the audit;
(e) the going concern assumptions and any qualifications; (f)
compliance with accounting standards; and
(g) compliance with the Listing Rules and legal requirements
in relation to financial reporting.
7.5 Regarding 7.4 above:-
(a) members of the Committee shall liaise with the Board,
senior management and the person appointed as the Company's
qualified accountant and the Committee must meet, at least
twice a year, with the Company's auditors; and
(b) the Committee shall consider any significant or unusual
items that are, or may need to be, reflected in the report
and accounts, it shall give due consideration to any matters
that have been raised by the Company's staff responsible for
the accounting and financial reporting function, complaince
officer or auditors;
Oversight of the Company's financial reporting system and internal control procedures
7.6 review the Company's financial controls, internal control
and risk management systems;
7.7 discuss the internal control system with management to
ensure that management has performed its duty to have an
effective internal control system. This discussion shall
include the adequacy of resources, staff qualifications and
experience, training programmes and budget of the Company's
accounting and financial reporting function;
7.8 consider major investigation findings on internal control
matters as delegated by the Board or on its own initiative
and management's response to these findings;
7.9 review the Group's financial and accounting policies and
practices. Special meetings may be called at the discretion
of the chairman of the Committee or at the request of the
senior management to review significant control or financial
issues;
7.10 review the external auditor's management letter, any
material queries raised by the auditor to management about
accounting records, financial accounts or systems of control
and management's response;
7.11 ensure that the Board will provide a timely response to
the issues raised in the external auditor's management
letter;
7.12 review management's reports on the effectiveness of
systems for internal control and financial reporting;
7.13 act as the key representative body for overseeing the
Company's relations with the external auditor;
7.14 make recommendation to the Board on the resolution of
any disagreements between management and the external auditor
regarding financial reporting;
7.15 discuss problems and reservations arising from the
interim review and final audits, and any matters the external
auditor may wish to discuss (in the absence of management
where necessary);
7.16 review arrangements that employees of the Company can
use, in confidence, to raise concerns about possible
improprieties in financial reporting, internal control or
other matters. The Committee shall ensure that proper
arrangements are in place for fair and independent
investigation of these matters and for appropriate follow-up
action;
7.17 report to the Board on the above matters; and
7.18 consider other topics, as defined by the Board.
Corporate Governance Function
7.19 develop and review the Company's policies and practices
on corporate governance and make recommendation to the
Board;
7.20 review and monitor the training and continuous
professional development of directors and senior
management;
7.21 review and monitor the Company's policies and practices
on compliance with legal and regulatory requirements;
7.22 develop, review and monitor the code of conduct and
compliance manual, if any, applicable to employees and
directors; and
7.23 review the Company's compliance with the Corporate
Governance Code as set out in the Chapter 14 of the Listing
Rules and disclosure in the Corporate Governance Report in
the Annual Report.
8 Reporting procedures
8.1 The Committee shall report to the Board on a regular
basis. At the next meeting of the board following a meeting
of the Committee, the chairman of the Committee shall report
the findings and recommendations of the Committee to the
Board.
8.2 The secretary shall circulate the draft and final
versions of minutes of meetings and reports of the Committee
to all Committee members for their comment and records
respectively within a reasonable time after the meeting.
9 Publication and Update of Terms of Reference
9.1 These terms of reference shall be updated and revised as
and when necessary in light of changes in circumstances and
changes in regulatory requirements, including those under the
Listing Rules, in Hong Kong.
9.2 These terms of reference shall be made available to the
public on both the
Company's website and the website of the Hong Kong Stock
Exchange.
distributed by | This press release was issued by Belle International Holdings Limited and was initially posted at http://www.belleintl.com/wcms-common/temp/201203271824290952/E_Audit Com Terms of Ref.pdf . It was distributed, unedited and unaltered, by noodls on 2012-03-27 13:20:48 PM. The issuer is solely responsible for the accuracy of the information contained therein. |