Audit Committee's Roles and Responsibilities of Selected Financial Institution: A Case Study

Abstract

The audit committee (AC) plays important roles and responsibilities in corporate governance. This study considers the extent of how a financial institution perceives AC’s roles and responsibilities in terms of financial and narrative reporting, whistleblowing, terms and remuneration, internal audit process, annual audit process. The descriptive approach coupled with quantitative analysis from the survey results of 50 respondents were used to have an in-depth understanding of perceived AC’s roles and responsibilities. The perceived roles and responsibilities of the audit committee are divided into functions: financial reporting, narrative reporting, whistleblowing, internal controls and risk management systems, internal audit process, external audit process, appointment and tendering, terms and remuneration, independence and annual audit cycle. The respondents’ perception is ‘Strongly Agree’, that the audit committee performs their function on narrative reporting, while the remaining roles and responsibilities (i.e. financial reporting, whistleblowing, internal controls and risk management systems, internal audit process, external audit process, appointment and tendering, terms and remuneration, independence and annual audit cycle) are being perceived as ‘Agree’. The researcher recommends to have a clearly defined policy and guideline on whistleblowing, and to extend the study to other industries, in order to address similar concerns in governance.