The purpose of the Committee is to provide on behalf of the Board of Education (the "Board"), oversight of the District's financial reporting and accounting practices, review of the adequacy of internal accounting and control systems, and review of the systems and processes for meeting the Board’s goals as they relate to delivering educational services through regular communication with the independent auditors, internal audit management, the Academic Auditor, financial management, and other appropriate District personnel.
Authority and Membership
The Committee is composed of six representatives from the community and two members of the Board. In addition, the Board President serves as a voting ex-officio member of the Committee. The members from the community are recommended to the Board by the President and approved by the Board. Members from the community serve a three-year term, and may be recommended for one successive term of three years after their initial appointment. These two terms are in addition to any unexpired term a member is appointed to complete. The Chairperson shall be a member from the community, appointed annually by the Board President and serving a calendar year term.
The Committee reports to the Board and has unrestricted access and authorization to obtain assistance from Board personnel to accomplish its purpose. In addition, the Committee has the discretion to initiate and supervise investigations within the scope of its duties as it may deem appropriate and to employ whatever additional advisors and consultants it deems necessary for the fulfillment of its duties.
Although Audit Committee members voluntarily contribute their time and expertise, regular attendance at Committee meetings is necessary for the Committee to be effective in meeting its oversight responsibility. If a member is going to miss three or more meetings in a row or more than four meetings in a year, the member should consider whether his or her other commitments will allow them to effectively serve on the Board’s Audit Committee. If unusual or emergency circumstances require a member to frequently miss the meetings, the member should discuss the circumstances with the Board President. Members may be asked to withdraw from the Committee if they are frequently unable to attend the meetings.
The Audit Committee will meet monthly based on a schedule established at the beginning of each year and adopted by the Committee. Scheduled meetings may be cancelled, with the approval of the Chair and the concurrence of the Board President, if there is not enough on the agenda to warrant a meeting. Additional meetings may be called if there are matters that must be covered prior to the next scheduled meeting.
Four Committee members shall constitute a quorum for purposes of taking action and voting on Committee decisions. The Board President may be counted when determining whether a quorum is present.
1. Financial Reporting and Accounting Practices
The responsibility of the Committee in the area of financial reporting and accounting practices is to provide reasonable assurance that financial disclosures made by management accurately portray the District's financial condition, results of operations and plans and long-term commitments. To accomplish this, the Committee at its discretion, will:
The responsibility of the Committee in the area of internal control is to provide reasonable assurance that the District is maintaining an effective system of internal control, including IT security and control, is in compliance with pertinent laws and regulations, and is conducting its affairs ethically. To accomplish this, the Committee at its discretion will:
2. Internal Accounting and Control Systems, and Systems and Processes for Meeting Board's Goals
- Provide oversight of the external audit coverage, including:
- Periodic nomination of independent public accountants based on a review of responses to an RFP developed for that purpose, and which includes provisions for contract renewal.
- Review with the independent public accountants the work plan and results of the audit engagement, and any non-audit services to be provided by the accountant.
- Review of audit and non-audit fees.
- Coordination with the Internal Audit and Accounting functions.
- Assessment of the auditor's independence.
- Review Board accounting policies and policy decisions.
- Assess the impact of significant regulatory changes and accounting and reporting developments.
- Review with management and the independent public accountants any significant reporting or operational issues that were discussed during the reporting period and determine how they were resolved.
- Review with management the issues and responses whenever a second opinion regarding a material issue is sought from an independent public accountant.
- Review the letter of management representations given to the independent public accountants.
- Review the audit reports and management letter issued by the independent public accountants.
- Provide oversight of the Internal Audit function by:
- Reviewing, approving, and monitoring audit plans, budgets and staffing levels.
- Reviewing audit results, and approving internal audit reports for presentation to the Board of Education.
- Reviewing the results of Academic Audits and other work completed by the Academic Auditor and approving them for presentation to the Board.
- Participating in the Board's appointment, appraisal of, and termination of the Board's Director of Internal Audit.
- Assess the extent to which the planned audit scope of Internal Audit and the independent public accountant can be relied on to detect fraud or weaknesses in internal controls and assess management's response to reported weaknesses or compliance deficiencies.
- Use information from the external auditors, the internal auditors, and District management to assess the extent to which the District's internal control structure is adequate to prevent or timely detect unacceptable levels of risk in District operations.
- Review Board policies relating to compliance with laws and regulations, ethics, conflict of interest, and the investigation of misconduct or fraud.
- Review significant cases of employee conflict of interest, misconduct or fraud.
- Consider the results of reviews by outside organizations, and the implications for the District's systems of control.
- Make recommendations to the Board regarding academic, financial and operational risks.
- Review the quality assurance practices (including the recommendations of the Quality Assurance Review) of the Internal Audit department and the independent public accountant.
- Review the different aspects of the District's business and academic programs to ensure a general understanding of operations and functional areas as well as the business and performance risks.
- Meet privately with the independent public accountant and the Internal Audit Director to discuss pertinent matters, including whether any restrictions have been placed by management on the scope of their examination.
- Report Committee activities to the Board on a regular basis.
- Review this charter annually and propose to the Board any recommended changes.