Effective audit is a vital source of information and support for governors. All governors need to be able to have confidence that the systems of governance, management and control are fit for purpose and are operating effectively. They also need to have confidence in the information provided and the processes used to provide that information. Effective audit provides some of that assurance as well as providing a window on the life of the institution. Audit is, therefore, an essential part of the framework of governance.
There have been remarkably few instances of failures of governance or financial viability in UK higher education, but those failures that have occurred often serve to emphasise the key role of audit, an effective and independent-minded audit committee and auditors who are robust and performing their work well.
Although all institutions are required to have an audit committee, which will oversee the audit processes in detail and report regularly to the governing body, the governing body is responsible for directing and overseeing the arrangements for internal and external audit. All governors have a duty to make themselves aware of audit and assurance processes; that interest sends an important message to the whole institution. Audit cannot simply be left to the audit committee.
The CUC Guide summarises the specific responsibilities of members of the governing body in relation to audit as:
The scope of audit is no longer just about finance. The whole structure of governance and management of the institution is open to scrutiny as well as subsidiary companies, joint ventures and the student union. Governing bodies will also wish to be assured that sound arrangements are in place to assure standards and quality in respect of academic work.
The Committee of University Chairs (CUC) has produced a Handbook for Members of Audit Committees. For further information about that and other sources of information see More Information.
Further information [PDF, 80kb]