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Dear Sir,
I sat in the current exams session for SBL and in one of the questions that I had it was to specify the benefits of having a separate Audit and Risk committes.. I wrote some benefits but can you share with me your thoughts about which can be the benefits of having such an structure? Thanks in advance for sharing your point of view!
Not sure what you mean by ‘a separate Audit and Risk committes’. If it means ”separate Audit and Risk committes’ then it would be along the lines that having separate committees allows the Audit Committee to concentrate fairly narrowly on financial reporting, internal,control, internal audit and liaising with external audit. The risk committee can look at wider types of risks and their mitigation such as fire, product liability, loss of key members if staff.
If it means ‘a separate Audit and Risk committe’ ie separate from those charged with governance then, in addition to covering the above items, the separate committee can bring greater objectivity and independence to bear, relatively unimpeded by commercial or general performance pressures.
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