Revised terms of reference of the Audit Committee
(Adopted by the Committee of Ministers on 12 January 2011
at the 1102nd meeting of the Ministers' Deputies)
The Committee of Ministers,
Determined to strengthen further internal and external control mechanisms which are essential for ensuring effective and efficient management and governance of the Council of Europe;
Having regard to the recommendations and comments of the External Auditors regarding further improvement of management and governance in the Council of Europe;
Having regard to Resolution CM/Res(2008)2 establishing an independent Audit Committee which has been reviewed by the Committee of Ministers after the first two years of its functioning;
Considering that the Audit Committee should be continued;
Recognising the need for enhancing the Council of Europe appraisal mechanisms to provide the member states with assurances that the Organisation’s controls are in place and operating properly through, inter alia, independent reviews of the work performed by the Council of Europe system of internal and external controls, including Internal Oversight, the External Auditor, and the administration and management of the Organisation;
Considering that the terms of reference should encompass evaluation, as well as the system of internal and external controls,
1. Adopts the revised terms of reference of the Audit Committee contained in the appendix to this resolution;
2. Decides that the administrative costs of the Audit Committee shall be funded through the Ordinary Budget;
3. Agrees that Resolution CM/Res(2008)2 will be replaced by the present resolution from the date of its adoption.
Appendix to Resolution CM/Res(2011)1
Terms of reference of the Audit Committee of the Council of Europe
1. Guiding principle
An Audit Committee shall be established by the Committee of Ministers to exercise an independent appraisal function as defined in Article 2 below. It shall perform this function through independent appraisal of internal and external control systems and of follow-up given to Internal Oversight and External Audit recommendations. The work of the Audit Committee shall be conducted in accordance with internationally accepted best practices and in compliance with Council of Europe policies, rules and regulations.
2. Role of the Committee
The Audit Committee shall have a consultative function and report to the Committee of Ministers and may advise the Secretary General, as appropriate within the limits of his or her responsibilities,
(i) on the scope, adequacy, efficiency and effectiveness of the Organisation’s system of internal and external controls, as well as risk management, including the evaluation and internal audit functions, the external audit functions and the implementation of their recommendations;
(ii) on all corporate governance issues relating to the system of internal and external controls and its performance;
(iii) on any matters of policy requiring corrective action and improvements in the area of controls, including appraisal of policies, procedures, evaluation, audit, investigation and risk management;
In accordance with the Deputies’ decision of 8 July 2009 (CM/Del/Dec(2009)1063/11.2) amending the procedure for the appointment of the External Auditor, the Audit Committee shall provide an advisory opinion to the Committee of Ministers on the conformity of the candidatures received with the selection criteria.
3. Membership of the Committee
The Audit Committee shall be composed of three members who shall be evaluation and audit professionals of high standing in the international oversight community, and between them represent qualified experience from evaluation, internal and external audit functions primarily in the public sector, and as far as possible, in the private sector. They shall be fully independent of the Council of Europe and national governments of the Council of Europe member states. The Committee of Ministers shall appoint the three members of the Audit Committee upon proposal of member states; the Secretary General may propose one candidate. The members of the committee shall elect the chairperson. Other parties may be requested to attend the meetings of the committee for specific agenda items but they shall not be members of the committee.
4. Terms of appointment
The members shall serve for terms of three years, renewable once.
5. Rules and procedures
(i) The Audit Committee shall decide on its own rules of procedure and communicate it to the Committee of Ministers. It shall meet for its regular sessions at least twice a year. Additional meetings may also be scheduled on an ad hoc basis as necessary. The chairperson of the committee shall determine the timing of meetings and the need for any additional meetings in the course of the year. He/she shall also set the agenda of the meetings, taking into account relevant requests of the Committee of Ministers. The Audit Committee shall be able to call upon Council of Europe officials and request meetings with other parties as it deems necessary to obtain information relevant to its work. In particular, the Director of Internal Oversight and the External Auditor shall be readily available to respond to inquiries and make presentations to the committee. The Director of the Internal Oversight shall meet with the committee at least once a year without the presence of the management; such restricted meetings can also take place with the external auditor and other parties, as appropriate. In performing their functions, the members of the committee shall neither seek nor receive instructions from any government authorities. They shall act fully independently of any individual Council of Europe bodies and structures, and shall be guided solely by their expertise and professional judgement, with due regard to the relevant decisions of the Committee of Ministers.
(ii) The annual work programme and related budget of the evaluation and internal and external audit functions shall be brought to the attention of the Audit Committee.
(iii) The Audit Committee shall adopt recommendations on a consensual basis. In the case of dissent among committee members, the conclusions of the chairperson in charge of the meeting, together with the dissenting opinion, shall be presented in the subsequent committee report.
6. Access to documents
The Audit Committee shall have access to all records and documents of the Organisation, including audit and evaluation reports, investigations, and work documents of the Directorate of Internal Oversight as well as the reports and management letters from the External Auditor. Committee members shall sign non-disclosure statements at the beginning of their tenure.
(i) The Audit Committee shall submit an annual report to the Committee of Ministers.
(ii) The Audit Committee may also submit ad hoc reports to the Committee of Ministers as necessary.
(iii) The Secretary General shall be given the opportunity to comment on all reports prior to their submission. Comments of the Secretary General, which he/she deems necessary, shall be incorporated in the relevant reports.
(i) The Audit Committee shall be provided with administrative and secretarial support as and when required.
(ii) Members of the Audit Committee shall be reimbursed travel and subsistence costs in accordance with Council of Europe administrative rules and regulations; they will receive no fees.