Companies Act 1967 · 2020 Revised Edition · Part 6 · Financial Statements and Audit
201B. Audit committees
Last amended by an amending law of 2014.
Official textFrom Singapore Statutes Online, unchanged
Every listed company must have an audit committee.
listed
“listed”, in relation to a company or corporation, means a company or corporation that has been admitted to the official list of an approved exchange in Singapore and has not been removed from that official list;
An audit committee must be appointed by the directors from among their number (pursuant to a resolution of the board of directors) and must be composed of 3 or more members of whom a majority must not be —
executive directors of the company or any related corporation;
a spouse, parent, brother, sister, son or adopted son or daughter or adopted daughter of an executive director of the company or of any related corporation; or
any person having a relationship which, in the opinion of the board of directors, would interfere with the exercise of independent judgment in carrying out the functions of an audit committee.
The members of an audit committee must elect a chairperson from among their number who is not an executive director or employee of the company or any related corporation.
director
“director” includes any person occupying the position of director of a corporation by whatever name called and includes a person in accordance with whose directions or instructions the directors or the majority of the directors of a corporation are accustomed to act and an alternate or substitute director;
If a member of an audit committee resigns, dies or for any other reason ceases to be a member with the result that the number of members is reduced below 3, the board of directors must, within 3 months of that event, appoint such number of new members as may be required to make up the minimum number of 3 members.
The functions of an audit committee are —
to review —
with the auditor, the audit plan;
with the auditor, the auditor’s evaluation of the system of internal accounting controls;
with the auditor, the auditor’s audit report;
the assistance given by the company’s officers to the auditor;
the scope and results of the internal audit procedures; and
the financial statements of the company and, if it is a parent company, the consolidated financial statements, submitted to it by the company or the parent company, and thereafter to submit them to the directors of the company or parent company; and
to nominate a person or persons as auditor, despite anything contained in the constitution or under section 205,together with such other functions as may be agreed to by the audit committee and the board of directors.
The auditor has the right to appear and be heard at any meeting of the audit committee and must appear before the committee when required to do so by the committee.
Upon the request of the auditor, the chairperson of the audit committee must convene a meeting of the committee to consider any matters the auditor believes should be brought to the attention of the directors or shareholders.
Each audit committee may regulate its own procedure and in particular the calling of meetings, the notice to be given of such meetings, the voting and proceedings thereat, the keeping of minutes and the custody, production and inspection of such minutes.
Where the directors of a company or of a parent company are required to make a statement under section 201(16) and the company is a listed company, the directors must describe in the statement the nature and extent of the functions performed by the audit committee pursuant to subsection (5).
company
“company” means a company incorporated under this Act or under any corresponding previous written law;
[Deleted by Act 36 of 2014]
Any reference in this section to a director who is not an executive director of a company is a reference to a director who is not an employee of, and does not hold any other office of profit in, the company or in any related corporation of that company in conjunction with his or her office of director and his or her membership of any audit committee, and any reference to an executive director is to be read accordingly.
related corporation
“related corporation”, in relation to a corporation, means a corporation that is deemed to be related to the firstmentioned corporation by virtue of section 6;
Terms defined in this Act
company
Defined · s 4“company” means a company incorporated under this Act or under any corresponding previous written law;
consolidated financial statements
Defined · s 209A“consolidated financial statements” has the meaning given by the Accounting Standards;
constitution
Defined · s 4“constitution”, in relation to a company, means —(a)the constitution of the company which is registered with the Registrar under section 19, as may be amended from time to time; and(b)in the case of a company incorporated before 3 January 2016, the memorandum of association of the company, the articles of association of the company, or both, in force immediately before that date;
director
Defined · s 4“director” includes any person occupying the position of director of a corporation by whatever name called and includes a person in accordance with whose directions or instructions the directors or the majority of the directors of a corporation are accustomed to act and an alternate or substitute director;
financial statements
Defined · s 209A“financial statements” means the financial statements of a company required to be prepared by the Accounting Standards;
listed
Defined · s 4“listed”, in relation to a company or corporation, means a company or corporation that has been admitted to the official list of an approved exchange in Singapore and has not been removed from that official list;
parent company
Defined · s 209A“parent company” means a company that is required under the Accounting Standards to prepare financial statements in relation to a group;
related corporation
Defined · s 4“related corporation”, in relation to a corporation, means a corporation that is deemed to be related to the firstmentioned corporation by virtue of section 6;
Part 7
Arrangements, Reconstructions and Amalgamations
Part 8
Part 8A
Part 9
Investigations
Part 10
Dissolution
Part 10A
Transfer of Registration
Part 11
Various Types of Companies, Etc.
Part 11A
Register of Controllers, Nominee Directors and Nominee Shareholders of Companies
Part 12