Audit and financial control

The UK Corporate Governance Code states that: C.2.3. The board should monitor the company’s risk management and internal control systems and, at least annually, carry out a review of their effectiveness, and report on that review in the annual report. The monitoring and review should cover all material controls, including financial, operational and compliance controls. . . C.3.2. The main role and responsibilities of the audit committee... to review the company’s internal financial controls and, unless expressly addressed by a separate board risk committee composed of independent directors, or by the board itself, to review the company’s internal control and risk management systems. So, in many companies the detailed work will be done by the audit committee (and their supporting staff) but the board as a whole has to take responsibility when it comes to reporting the results of the IC review in the annual report.