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About us > Structure of Committees > Terms of Reference for the Audit Committee
Confirmed by the Council : June 2007
Updated - June 2010
Established : 2006
Duration : Unspecified
Mandate
The role of the Audit Committee will, as part of the ongoing systematic review of the WCO control environment and governance procedures, be to oversee the Audit function and advise the Policy Commission and the Council as well as the WCO Secretary General in relation to the operation and the development of this function. The Audit Committee acts under the overall direction of the WCO Council with administrative support provided by the WCO Secretariat. The Audit Committee assists the Policy Commission and the Council in fulfilling their oversight responsibility with respect to :
- the overall implementation of the WCO Strategic Plan;
- the budget allocation process and performance measurement policies and practices of the Organization;
- efficient and effective programme management and the attainment of objectives, as outlined in the Strategic Plan;
- the protection of resources and their efficient and effective application against stated priorities; and
- the identification and mitigation of significant risks.
The Audit Committee provides independent, documented objective advice to the governing bodies of the WCO through the systematic review and follow-up of all internal and external Audit work undertaken in relation to the WCO control environment, risk management practices, decision support, governance and compliance processes. The WCO financial and management Audits are carried out, in accordance with the Council’s decision, by independent professional auditors from the private sector.
Membership
All members of the Audit Committee are appointed by the Council and can be removed by the Council at its sole discretion. The term of office of the Audit Committee members shall be three years. Exceptionally and on the proposal of the Audit Committee to the Council, the duration of the term of office may be extended by one year in order to provide for continuity of membership. The Committee shall comprise six Directors General from the Council, representative of the six regions. The seats on the Committee are allocated ideally on a rotating basis from among the active Members in the region. In special circumstances, a lower ranking official may represent his/her Administration on the Audit Committee, provided that such a representative reports directly to the Director General of the Administration.
In the interest of good governance and separation of functions, there should be no overlap between executive and non-executive functions. There should be no overlap in voting membership between the Finance and Audit Committees.
Scope, purpose and action to be taken
The Audit Committee may review, discuss and report to the Policy Commission and Council on any matter related to its terms of reference.
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making suggestions concerning risk management in accordance with organizational guidelines and work plans emerging from the WCO Strategic Plan; participating, through the Chairperson and the Vice-Chairperson, in the selection of the external management auditor;
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reviewing and approving the annual Audit plan;
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reviewing audit recommendations and findings;
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assessing the outcome of the Audit process having regard to findings, recommendations and management responses;
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reviewing and evaluating the performance of the independent auditors;
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assuring that Audit work is performed to the highest standards;
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monitoring the implementation of the WCO Strategic Plan on a cyclic basis;
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fostering the implementation of best practices in the Audit function; and
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advising and making recommendations to the Policy Commission and Council as well as to the Secretary General on any matter pertaining to the WCO Audit function, as the Audit Committee considers necessary or appropriate, including its organization, resources, training and use of technology (IT environment, for example).
Key Deliverables
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Reviewed and approved plans for internal and external Audits that provide thorough, prioritized coverage of critical areas, taking into account the delivery capacity of available audit resources;
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Comprehensive reports on reviewed Audit findings/recommendations, the nature, scope and outcomes of all Audit efforts and implemented audit findings and recommendations thus bringing them to the attention of the Policy Commission and the Council for assurance of relevant follow-up action by the competent bodies;
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An evaluation report on the efficacy of the Audit Committee to be submitted to the Council after two years.
Means of Operation
Resources Required
The home administrations of the Chairperson, Vice-Chairperson and members of the Audit Committee are required to bear their own expenses (travel and accommodation).
