Composition
Usually, membership of the Committee is subject to the maximum number of 6 persons.
- In the USA, a qualifying audit committee is required for listed publicly traded companies. To qualify, the committee must be composed of independent outside directors with at least one qualifying as a financial expert.
- European Union, 8th Directive on company law 2006/43/EC: “Each public-interest entity shall have an audit committee. The Member State shall determine whether audit committees are to be composed of non-executive members of the administrative body and/or members of the supervisory body of the audited entity and/or members appointed by the general meeting of shareholders of the audited entity. At least one member of the audit committee shall be independent and shall have competence in accounting and/or auditing.”
- Institute of Internal Auditors best practice: “The audit committee will consist of at least three and no more than six members of the board of directors... Each committee member will be both independent and financially literate. At least one member shall be designated as the "financial expert," as defined by applicable legislation and regulation”.
Read more about this topic: Audit Committee
Famous quotes containing the word composition:
“Viewed freely, the English language is the accretion and growth of every dialect, race, and range of time, and is both the free and compacted composition of all.”
—Walt Whitman (1819–1892)
“Vices enter into the composition of virtues as poisons into the composition of certain medicines. Prudence and common sense mix them together, and make excellent use of them against the misfortunes that attend human life.”
—François, Duc De La Rochefoucauld (1613–1680)
“Every thing in his composition was little; and he had all the weaknesses of a little mind, without any of the virtues, or even the vices, of a great one.”
—Philip Dormer Stanhope, 4th Earl Chesterfield (1694–1773)