The financial memorandum between the funding body and the institution requires the governing body to establish an audit committee. The work of audit committees is to ensure the governing body can be confident about the effective operation of the organisation's processes and systems, the management of risk, and the correctness and integrity of the information provided to governors and external bodies.
The CUC's 'Handbook for Members of Audit Committees in Higher Education Institutions' (2008:6) indicates the audit committee should concern itself with:
While the focus of audit committees has been traditionally been on financial records and systems, and this continues to be an important area of work, committees are increasingly concerned with, for example, data quality and returns geneally to the institution's funding bodies and the Higher Education Statistical Agency (HESA). Audit Committees will also be mindful of the demands of organisations such as, for example, UK Visa and Immigration, whose actions have the potential to adversely affect an institution's ability to recruit international students.
For further information go to Governors' briefing note No. 14: Audit
The Getting to Grips with Audit offers an introduction to audit.
The Audit Code of Practice for English HEIs is Annex A of HEFCE's Memorandum of assurance and accountability between HEFCE and institutions.
The Scottish Funding Council's mandatory requirements for Scottish HEIs are contained in its Financial Memorandum.
The Audit Code for Welsh HEIs can be found here.
For Northern Ireland, the Department for Employment and Learning, is the funding authority for higher education.
The CUC Handbook for Members of Audit Committees of HEIs provides detailed discussion about the work of audit committees. The Handbook is accompanied by separate appendices, which contain model templates. These include terms of reference, a format for the committee's annual report to the governing body and an example of an internal audit plan. The Handbook and appendices can be downloaded from HEFCE's website.