The Audit Committee is a sub-committee of B2Holding ASA’s board of directors. It acts as a preparatory body in connection with the Board's supervisory roles with respect to financial reporting and the effectiveness of the Company’s internal control system, and other tasks set forth in these instructions.
INSTRUCTIONS FOR THE AUDIT COMMITTEE
This document is adopted to secure that B2Holding ASA (“B2Holding” or the “Company”, and together with its consolidated subsidiaries the “Group”) complies with applicable regulations regarding the Company’s business.
The Audit Committee is a sub-committee of B2Holding ASA’s board of directors (the “Board”) and its objective is to act as a preparatory body in connection with the Board's supervisory roles with respect to financial reporting and the effectiveness of the Company’s internal control system, and other tasks assigned to the Audit Committee in accordance with the provisions set forth in these instructions.
The Audit Committee supports the Board in the administration and exercise of its responsibility for supervision in accordance with applicable provisions of the Norwegian Public Limited Companies Act and Norwegian securities legislation, as well as applicable listing standards of Oslo Børs, in particular in relation to:
(i) the financial reporting process;
(ii) monitor the effectiveness of the Company’s internal control, internal audit and risk management system relating to financial reporting processes;
(iii) review and monitor the independent auditor’s qualifications and independence; and
(iv) monitor the Company’s compliance with applicable legal and regulatory requirements.
The Board determines the instructions and composition for the Audit Committee.
The Audit Committee shall consist of at least two members of the Board. The members and the chairman of the Audit Committee shall be appointed by the Board for a two-year term, but continues in their position until replaced. If a member of the Audit Committee resigns from the Board, such member must be replaced on the Audit Committee.
The composition of the Audit Committee shall be in compliance with the Norwegian Public Limited Companies Act. A majority of the members of the Audit Committee shall be independent of the Company’s executive management. Further, the entire Board shall not act as the Audit Committee.
At least one member shall have competence in accounting or auditing. The Audit Committee shall have the competence required to perform the committee's tasks when considered in the context of the Company's organisation and business activities, cf. the Norwegian Public Limited Liabilities Act section 6-42, 2 para. When appointing members, the Board shall take into consideration whether the person concerned has the necessary knowledge of basic internal control, finance and accounting practices.
The Audit Committee shall have full access to all books, records and personnel of the Group, as well as the external auditor of the Company. The Audit Committee may also retain independent counsel, accountants or others to advise the Audit Committee or assist in the conduct of its duties.
It is not the responsibility of the Audit Committee to plan or conduct audits or to determine whether the Company or the groups’ financial statements are complete, accurate, or in accordance with IFRS.
The Audit Committee will meet as often as it deems necessary, but normally 2 - 3 times every year. The Audit Committee will draw up an annual meeting plan. Interim meetings may be called if a member of the Audit Committee requires it.
The Company’s Chief Executive Officer and other members of the Board of Directors are entitled to participate in the Audit Committee’s meetings. The Company’s Chief Group Controller will be the executive management’s main representative in relation to the Audit Committee and will participate in the Audit Committee's meetings, unless instructed otherwise by the committee.
The external auditor will participate in meetings when matters falling within the scope of the external auditors responsibilities are considered.
Meeting agendas shall be prepared and provided in advance to members, along with appropriate briefing materials. Minutes of all Audit Committee meetings shall be prepared.
The accounts of the Group shall reflect its business activities. The accounting – and auditing process has to be sufficient to handle the business' complexity and size. The Audit Committee must thus have a broad focus and ensure that it has sufficient understanding of:
- The operations and risks, including management and control;
- The accounting principles and the accounting process;
- Risk management and internal control with financial reporting; and
- The external auditor and its independence.
The Audit Committee’s primary responsibilities include:
(i) Overseeing the external auditor relationship by discussing with the auditor the nature and rigor of the audit process, receiving and reviewing audit and other reports including responses from the management related thereto, and providing the auditor full access to the Audit Committee, with or without the management of the Company present, to report on any and all appropriate matters.
(ii) Assessing whether non-audit services provided by the external auditor may affect the independence of the external auditor.
(iii) Reviewing the annual financial statements of the Company and the Group and discussing them with the relevant members of the management of the Company before they are presented to the Board for approval (and subsequently to the Company’s shareholders).
(iv) To the extent the Audit Committee in its sole discretion determines, reviewing the interim financial statements of the Company and the Group and discussing them with the relevant members of the management of the Company before they are presented to the Board for approval.
(v) Reviewing and discussing with the relevant members of the management of the Company and the external auditor the financial statements produced by the various companies in the Group, with focus upon accounting and consolidation principles used in the Group and accounting principles / items in the accounts that have discretionary elements.
(vi) Discussing with the relevant members of the management of the Company and the external auditor the quality and adequacy of the Company’s systems for internal control and for managing business, financial and regulatory risks, including computerised information system controls and security. This would also include a review of the Company and the Group’s insurance coverage.
(vii) Discussing with the relevant members of the Company's management the status of pending litigation, tax matters and other areas of oversight to the legal and compliance area as may be appropriate related to financial issues.
(viii) Arranging an annual review to check that the proper authorisation process has been observed in the Company and the Group.
(ix) If such authority has been delegated to the Audit Committee by the Company’s general meeting or the Board, determining the auditor’s proposed remuneration.
(x) Making recommendations in connection with the general meeting’s appointment of an external auditor.
(xi) Reporting Audit Committee activities and actions to the Board, cf. Section 5.
(xii) Reviewing and reassessing the adequacy of these guidelines annually and recommending any proposed changes to the Board for approval.
(xiii) Reviewing the Group's risk strategies and propose changes to the risk strategies when required.
(xiv) Monitoring the Management's implementation of the risk strategies adopted by the Board.
(xv) Preparing and making recommendations on matters within corporate governance.
(xvi) Preparing and making recommendations on matters within anti-money laundering, fraud and whistle-blowing.
5 REPORTING TO THE BOARD OF DIRECTORS
The Audit Committee shall regularly report to the Board on the Audit Committee’s activities and any issues that may arise with respect to the quality or integrity of the Company’s financial statements, the Company’s compliance with legal or regulatory requirements, and the performance and independence of the Company’s external auditor. Reporting may be in the form of written minutes of meetings, memoranda and ad hoc presentations at meetings of the Board.
The Audit Committee shall provide an open avenue of communication between internal audit, the external auditor, and the Board.