Question

Discuss the difference between the Audit Committee Report and Auditors Report.   

Answer 1

Audit commi reports are more or less focussed around following features:

The main role and responsibilities of the audit committee should include:

• monitoring the integrity of the financial statements and any formal announcements relating to financial performance;
• reviewing internal financial controls and, unless there is a separate board risk committee, reviewing the company’s internal control and risk management systems;
• monitoring and reviewing the effectiveness of the internal audit function;
• making recommendations to the board in relation to the appointment, re-appointment and removal of the external auditor and approve the remuneration and terms of engagement of the auditor;
• reviewing the auditor’s independence and objectivity;
• developing and implementing the non-audit services policy.

Sourced from ICEAW description on roles and responsibilities of audit committee

Audit committee meets usually before board meeting and hence, report may be limited to 4 to 8 in a year. Audit committee reports are prepared by audit committee members (executive and non-executive)

Now,

Audit report may vary upto 100 reports in a year depending upon the size of the company

Audit reports are more in-depth analysis of various process of the company and risks are studied in detail

Audit reports are prepared by internal auditors and external auditors

A summary of significant findinf of audit reports are presented / included in audit commmcomm reports

Internal audit reports review may or may not be continuous basis while audit committee reports are published during or after quarter reports are released