AUDIT COMMITTEE OF THE BOARD OF TRUSTEES OF THE ROYALAIRFORCEMUSEUM

TERMS OF REFERENCE

Approved by the Board of Trustees on 9 December 2002

The Board of Trustees is responsible for appointing an Audit Committee from within its membership. The Committee may co-opt up to two further persons to sit on the Committee. Co-optees need not be Trustees but their appointment must be approved by the Board of Trustees. All actions by the Audit Committee are taken on behalf of the Board of Trustees as a whole and they make recommendations to the Board. The primary responsibility for financial and other reporting, internal control, and compliance with laws, regulations, and ethics within the Museum rests with executive management.

1.Role of the Audit Committee

1.1To consider and approve external and internal audit plans and activities, and to

review internal and external arrangements for financial controls.

2.Responsibilities of the Audit Committee

2.1To be responsible for making arrangements on the adequacy of internal financial

and resource controls/systems operated by the Museum, in compliance with all relevant laws, regulations, accounting standards, procedures and practices and reporting to the Board of Trustees thereon.

2.2To be responsible for reporting and making recommendations to the Board of

Trustees on the adequacy of procedures applying to the acquisition, recording and disposal of artefacts and other assets of the Museum.

2.3To receive and review all Museum Annual Accounts in draft format, and consider the form and content of published accounts.

2.4.To review all management letters and responses by the Museum.

2.5To administer the appointment process of external auditors and recommend

candidates for appointment by the Board of Trustees subject to the agreement of the Comptroller and Auditor General of the National Audit Office.

2.6To appoint, as necessary, auditors to carry out internal work and approve their

remuneration.

2.7To commission and receive supplementary reports from auditors as necessary

and approve their remuneration.

2.8.To consider, and put to the Board of Trustees for approval, the remuneration of

the external auditors.

2.9.To direct the activities of, and receive reports from, the appointed internal

auditors.

3.Procedures of the Audit Committee

3.1The Board of Trustees will elect up to four of their members to serve on the

Audit Committee. The Chairman of the Board of Trustees will be an ex-officio member of the Committee but no member of the Finance Committee shall be eligible for election to the Audit Committee.

3.2The Committee may co-opt up to two further persons to sit on the Committee. Co-optees need not be Trustees but the appointment of co-opted members must be approved by the Board of Trustees.

3.3The quorum of the Committee will be two members one of whom must be a

Trustee.

3.4The Committee will normally meet four times per year.

3.5Any member of the Board of Trustees, the Command Secretary or Deputy

Command Secretary from the Sponsor Branch, and the National Audit Office are entitled to attend meetings of the Committee as an observer.

3.6The Director of the Royal Air Force Museum, in his capacity as Accounting

Officer, will be in attendance at meetings of the Committee.

3.7The Museum Secretary will act as Secretary to the Committee.

3.8The Director will appoint, subject to ratification by the Committee, a senior

member of staff as Internal Auditor who may also be in attendance at the meetings of the Committee. The appointed internal auditor has the right of direct access to the Chairman of the Committee.

3.9The Managing Director and Company Secretary of RoyalAirForceMuseum

Enterprises Ltd may each be requested to attend meetings of the Committee.

3.10The Museum’s external and internal auditors and Reporting Accountants may be

invited or request to attend meetings.

3.11The Committee will approve a rolling programme of internal audit work and may

appoint a suitably qualified and experienced outside company to carry out all or

part of that programme.

3.12The Committee may direct that additional reports or investigations be prepared `

into aspects of the financial affairs of the Museum, and may direct that additional resources be made available from within or outside the Museum.

3.13Minutes of the Committee will be circulated to members of the Board of

Trustees and those entitled to attend meetings of the Committee.