Prepared by: _____ Date: ___________ Reviewed by: ____ Date: ___________

CORPORATE GOVERNANCE INTERNAL CONTROL QUESTIONNAIRE Introduction Corporate Governance is defined as the system by which organizations are directed and controlled. The role of the Board is to develop and execute strategy; therefore a governing body is required which has the right mix, the right skills and the right attitudes. The ICQ outlined below is designed for public sector audits where the time budget is 2 3 days.

Question Responsibility Do members of the Board understand their responsibilities? Is there a transparent and clear structure of responsibility, which differentiates between what, the Board can do, and what managers and employees can do? Does the Board and the relevant sub-committees have clearly defined terms of reference? Membership Does the organization have a Search or Nominations Committee, which is responsible for selecting Board members? Who makes the recommendations? Is there a formal process for application to the Board? How does the Board ensure that members are suitable? How is caliber assessed? Do the members have to complete Fit and Proper forms? Is the background of the potential board members investigated? How is it ensured that only individuals with the right skills and attitudes are selected? How are members inducted? Is there any training provided for members? Is this regular? How does the organization ensure that this training is suitable?

Yes

No

N/A

Comments

Contributed by Kastuv Ray 24th February, 2003 kastuv@kastuv.fsnet.co.uk

Prepared by: _____ Date: ___________ Reviewed by: ____ Date: ___________

Composition of the Board How does the organization ensure that the governing body is not too large or small for the organization concerned? Does the organization have any kind of mechanism that members are not too stale, thus preventing the organization from achieving its objectives?

Meetings Are there set quota for meetings? Are regular meetings of the Board and sub-committees held?

Information How are members kept informed? Are there any policies, which state what, should go to whom? What information is provided in advance of meetings? Who is responsible for recording information at meetings? Are minutes of the previous meeting approved at the following meeting? Is responsibility for action clearly indicated in the minutes? Does the organization undertake a review to ensure that actions decided at meetings have been undertaken? Register of Interests What is the procedure for recording an interest? Is a register of interests held? Is this reviewed on an annual basis and updated? Do members have to sign this register?

Fraud and Corruption and Whistleblowing Policy? Does the organization have a separate Fraud and Corruption Policy and Whistleblowing Policy? Is this reviewed regularly? Who is responsible for its review? Does the organization benchmark these policies against Best Practice in the sector?

Contributed by Kastuv Ray 24th February, 2003 kastuv@kastuv.fsnet.co.uk

Prepared by: _____ Date: ___________ Reviewed by: ____ Date: ___________

Performance Measurement/Review How is the performance of the board and its subcommittees reviewed? Does the organization undertake a review of its terms of reference? How often is this undertaken? Are there set performance indicators? Are reports produced detailing the Boards/subcommittees objectives for the year and progress against these objectives? Does the Audit Committee produce a report on the internal audit function? Is the internal audit plan reviewed? Is a review undertaken regarding the quality of the agenda and minutes? Is any review undertaken into the approach taken by the governing body regarding the scrutiny of the financial statements? Does the organization undertake a review to ensure that Board members have not become too stale? Who audits the Board? How often is this undertaken?

Contributed by Kastuv Ray 24th February, 2003 kastuv@kastuv.fsnet.co.uk