The Audit and Risk Committee's primary role is to ensure that an effective enterprise risk management framework has been implemented. Within this framework, the committee assists the board in fulfilling its oversight responsibilities regarding financial risks, including efficiency and effectiveness of operations; safeguarding of assets and members' deposits; compliance with regulatory requirements; reliability of financial reporting; and independence of the external and internal audit functions. This report outlines the key activities undertaken during the year.
The committee gained assurance that the enterprise risk management framework is effective by reviewing various reports prepared by management. The committee reviewed and monitored impacts of the COVID-19 pandemic within the established enterprise risk management framework. The committee also reviewed various risk-related governing policies and recommended these policies to the board for approval.
The committee gained assurance that management has implemented appropriate internal controls and that regulatory requirements are being met by reviewing reports prepared by management, the Internal Auditor, and regulators.
The committee gained assurance that financial information was reliable and fairly presented by reviewing and approving ACU's accounting policies; reviewing management's financial reporting and budgeting processes; reviewing the quarterly financial statements and loan loss allowance; and reviewing and recommending the annual audited financial statements to the board for approval. The committee also reviewed and monitored the impacts of the COVID-19 pandemic on financial results.
Internal audit function
The committee oversaw the internal audit function by approving the annual internal audit work plan; gaining assurance the internal audit function is using a risk-based approach; gaining assurance the conduct of internal audit is consistent with professional standards; reviewing reports from the Internal Auditor; meeting in-camera with the Internal Auditor; and evaluating the performance of the internal audit function. The committee also reviewed and approved amendments to the annual work plan to include emerging risks as a result of the COVID-19 pandemic.
The committee oversaw the External Auditor by approving the engagement letter and external audit fees; reviewing the scope and timing of the External Auditor's work; reviewing the auditor's independence; meeting in-camera with the External Auditor; evaluating the services of the External Auditor; and recommending to the board the appointment of the External Auditor. The committee also reviewed the Canadian Public Accountability Board (CPAB) annual report on audit quality and has implemented a process to discuss the report with the External Auditor annually.