Companies Act 2014 section 167

Audit committees

Section 167 requires the boards of directors of large companies to consider establishing audit committees, sets out the financial thresholds that determine which companies are affected, and specifies the composition, independence requirements, and responsibilities of such committees.

• A company is a "relevant company" if, in both the most recent and preceding financial year, its balance sheet total exceeds €25 million and its turnover exceeds €50 million — either on its own or when combined with all its subsidiary undertakings.
• The board of a relevant company must either establish an audit committee or explain in the directors' report why it has chosen not to do so.
• The audit committee must include at least one independent non-executive director with competence in accounting or auditing, who has had no material business relationship with, or employment in, the company during the preceding three years.
• The committee's minimum responsibilities include monitoring financial reporting, internal controls, risk management, the statutory audit, and auditor independence — and the statutory auditors must report key audit findings, including material internal control weaknesses, to the committee.

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