| Constitution |
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| 1. |
The Audit Committee (the "Committee") is established by the Board of Directors. |
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| 2. |
The scope of authority and responsibilities of the Committee covers CITIC International Financial Holdings Limited and all its subsidiaries (hereinafter defined as "the Company"). |
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| Membership |
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| 3. |
The Committee shall be appointed by the Board from amongst the non Executive Directors of the Company and shall consist of not less than three members with Independent Non-Executive Directors as majority. |
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| 4. |
The Chairman of the Committee shall be an Independent Non-Executive Director and shall be appointed by the Board. |
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| Attendance at meetings |
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| 5. |
In each committee meeting, representatives of the external auditors, the Chief Executive Officer, the Group Chief Financial Controller, the Head of Group Audit or other executives/officers of the Company may be invited to attend the meeting. Other Board members shall also have the right of attendance. However, at least once a year the Committee shall meet with the external auditors without executive Board members present. |
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| 6. |
A quorum shall be two members of the Committee with a majority of Independent Non-Executive Directors. Any decision or resolution passed by the Committee shall be arrived by simple majority, with each Committee member carrying one vote and the Chairman having a casting vote. |
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| 7. |
The company secretary shall be the secretary of the Committee. |
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| Frequency of meetings |
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| 8. |
Meetings shall be held not less than twice a year. Ad hoc meetings may be held as required by the Committee members. The external auditors, the Chief Executive Officer, the Group Chief Financial Officer or the Head of Group Audit of the Company may request a meeting if they consider that one is necessary. |
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| Authority |
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| 9. |
The Committee is authorised by the Board to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to co-operate with any request made by the Committee. |
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| 10. |
The Committee is authorised by the Board to obtain outside legal or other independent professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers this necessary. |
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| Duties |
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| 11. |
The duties of the Committee shall be: |
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| a. |
To assist the Board in providing independent review of the effectiveness of the financial reporting process and internal control systems of the Company; |
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| b. |
To consider the appointment of the external auditors, the audit fee, and any questions of resignation or dismissal; |
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| c. |
To discuss with the external auditors before the audit commences, the nature and scope of the audit, and ensure co-ordination where more than one audit firm is involved; |
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| d. |
To review the half-year and annual financial statements before submission to the Board, focusing particularly on: |
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| i. |
any changes in accounting policies and practices; |
| ii. |
major judgmental areas; |
| iii. |
significant adjustments resulting from the audit; |
| iv. |
the going concern assumption; |
| v. |
compliance with accounting standards; and |
| vi. |
compliance with the relevant regulatory and legal requirements. |
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| e. |
To discuss problems and reservations arising from the interim and final audits, and any matters the external auditors may wish to discuss (in the absence of management where necessary); |
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| f. |
To review the external auditors' management letter and management's response; |
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| g. |
To establish a reporting line from the internal audit function to the Committee to facilitate the Committee's review on the following areas: |
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| i. |
the objectives, operation and performance of the internal audit function; |
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the annual audit plan; |
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the adequacy of resources available to the internal audit function and the appropriateness of its standing within the Company; |
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significant matters reported by the internal auditors and managements' response; |
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the coordination between the internal and external auditors; and |
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the performance and remuneration of the Head of Group Audit. |
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| h. |
To consider other matters, as defined by the Board and agreed by the Committee. |
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| Reporting procedures |
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| 12. |
The secretary shall circulate the minutes of meetings of the Committee to all members of the Board. |
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