ABOUT AUSTRAL GOLD

Charters

The Board is committed to achieving and demonstrating the highest standards of corporate governance.  As such, Austral Gold Limited and its subsidiaries (‘the Group’) have adopted a corporate governance framework and practices to ensure they meet the interests of shareholders.

Charters

Board Charter

In accordance with Principle 1 of the ASX Corporate Governance Principles, the Board of Directors is responsible for guiding and monitoring the Company on behalf of the shareholders by whom they are elected and to whom they are accountable. 

The Board is responsible for and has the authority to determine all matters relating to the strategic direction, policies, practices and goals for management and the operation of the Company.

The monitoring and ultimate control of the business of the Company is vested in the Board. The Board’s primary responsibility is to oversee the Company’s business activities and management for the benefit of the Company’s shareholders. The specific responsibilities of the Board include:

  • appointment, evaluation, rewarding and if necessary, the removal of the Chief Operating Officer;
  • appointment, evaluation, rewarding and if necessary, the removal of the Chief Financial Officer and the Company Secretary;
  • development of corporate objectives, strategy and operations plans, in conjunction with management, and approving and appropriately monitoring plans, new investments, major capital and operating expenditures, capital management, acquisition, divestitures and major funding activities;
  • establishing appropriate levels of delegation to the Chief Financial Officer/Company Secretary to allow her to manage the business efficiently;
  • monitoring actual performance against planned performance expectations and reviewing operating information at a requisite level, to understand at all times the financial and operating conditions of the Company;
  • monitoring the performance of senior management including the implementation of strategy and ensuring appropriate resources are available;
  • maintaining an appreciation of areas of significant business risk and ensuring that the Company is appropriately positioned to manage those risks via its senior management;
  • overseeing the management of safety, occupational health and environmental matters;
  • satisfying itself that the financial statements of the Company fairly and accurately set out the financial position and financial performance of the Company for the period under review;
  • satisfying itself that there are appropriate reporting systems and internal controls in place to assure the Board of appropriate operational and financial compliance;
  • to ensure that appropriate internal and external audit arrangements are in place and operating effectively;
  • satisfying itself that frameworks are in place to ensure the Company acts legally and responsibly on all matters and remains consistent with the code of conduct; and
  • reporting to shareholders.

While the Board retains full responsibility for guiding and monitoring the Company in discharging its stewardship at all times, the Board has established an Audit Committee and will in the future seek to establish other committees as deemed appropriate from time to time.

 Each director has the right to seek independent professional advice on matters relating to his/her position as a director of the Company at the Company’s expense, subject to the prior approval of the Chairman, which shall not be unreasonably withheld.

 In the event of a conflict of interest or where a potential conflict of interest may arise, involved directors will, unless the remaining directors resolve otherwise, withdraw from deliberations concerning the matter.

 In accordance with the constitution of the Company clause 13.2, directors must offer themselves for re-election by shareholders at least every 3 years. The Board does not specify a maximum term for which a director may hold office.

 The responsibility for the day-to-day administration of the Company is delegated by the Board to the Chief Financial Officer/Company Secretary. The Board has procedures in place to assess the performance of the Chief Financial Officer/Company Secretary and senior management team. They also ensure these key management roles are staffed by personnel appropriately qualified and experienced to discharge their responsibilities.

 The Chairman’s role is a non-executive position. The Chief Financial Officer/Company Secretary is accountable to the Board for all authority delegated to the position.

 While there is a clear division between the responsibilities of the Board and management, the Board is responsible for ensuring that management’s objectives and activities are aligned with the expectations and risks identified by the Board. The Board has a number of mechanisms in place to ensure this is achieved including:

  • Board approval and monitoring of annual budgets against actual performance;
  • regular meetings and briefings with senior management and key personnel to ensure the Board is kept apprised of relevant company activities.
Expenses

Expenses incurred by directors in fulfilling their duties be authorised prior to being reimbursed by the company.

Reimbursement of general business expenses less than A$2,000 may be authorised by any one Director or the Company Secretary. Reimbursement of expenses in excess of A$2,000 must be approved Board.

This policy is reviewed annually.

Audit Committee Charter

Scope
In accordance with Principle 4 of the ASX Corporate Governance Principles, the Audit Committee is a committee of the Board of the Company with specific powers delegated under this Charter. The Charter sets out the Audit Committee’s function, composition, mode of operation, authority and responsibilities.

Function
The primary function of the Committee is to assist the Board in fulfilling its responsibilities relating to accounting and reporting practices of the Company. In addition, the Committee will:

  • oversee, co-ordinate and appraise the quality of the audits conducted by both the Company’s external and internal auditors;
  • determine the independence and effectiveness of the external and internal auditors;
  • maintain open lines of communications among the Board and auditors to exchange views and information, as well as confirm their respective authority and responsibilities;
  • serve as an independent and objective party to review the financial information submitted by management to the Board for issue to shareholders, regulatory authorities and the general public; and
  • review the adequacy of the reporting and accounting controls of the Company.

Meetings
The Committee shall:

  • meet as frequently as required to undertake its role effectively
  • have the minimum quorum for a committee meeting (two members)
  • keep minutes of its meetings 

Authority
In performing its functions in accordance with any applicable law, the Committee:

  • has unrestricted access to the external auditors, senior management and employees of the Company;
  • has unrestricted access to information and reports relevant to fulfilling its responsibilities;
  • may seek independent external advice on matters brought before the Committee or in relation to the functions and responsibilities of the Committee; and
  • has the power to conduct or authorise investigations into any matters within the committee’s scope of responsibilities or when requested by the Board.

Responsibilities
The Committee must promote an environment within the Company that is consistent with best practice financial reporting. In particular, the Committee must:

  • perform an independent review of financial information prepared by management for external reporting. This will include conducting a review of the annual report, directors’ report, annual financial statements, half yearly financial statements and any other externally reported financial information required by law;
  • monitor the integrity and effectiveness of financial reporting processes;
  • review and assess the external audit arrangements;
  • review and ensure the implementation of major accounting changes;
  • ensure that appropriate policies are established and adequate systems are in place to identify, assess the propriety of and disclose any related-party transactions; and
  • ensure the Board is kept regularly informed on general progress and activities, and is promptly briefed on significant matters.

External audit arrangements
The Committee shall report to the Board on external audit arrangements including:

  • making recommendations to the Board on the appointment, re-appointment, replacement and remuneration of the external audit firm;
  • review the terms of engagement for the external auditor;
  • review the scope of the external audit with the external auditor including identified areas of risk
  • monitor the performance of the external auditors including: assessment of the quality and rigour of the service provided; and the audit firm’s internal quality control procedures;
  • review and monitor management’s responsiveness to the external audit findings; and
  • meet with the external auditor without the presence of management as deemed appropriate 

Appointment of external auditor
Should a change in auditor be considered necessary, a formal tendering process will be undertaken. The Committee will identify the attributes required of an auditor and will ensure the selection process is sufficiently robust so as to ensure selection of an appropriate auditor.

The Committee will ensure that prospective auditors have been provided with a sufficiently detailed understanding of the Company, its operations, its key personnel and any other information, including group structures and financial statements that will have a direct bearing on each firm’s ability to develop an appropriate proposal and fee estimate.

The Committee and the Board will consider the appointment in conjunction with senior management.

In selecting an external auditor, particular consideration will be given to determining whether the fee quoted is sufficient for the work required, that the work is to be undertaken by people with an appropriate level of seniority, skill and knowledge and whether the work proposed is sufficient to meet the Company’s needs and expectations.

The appointment of a new external audit firm will be placed before shareholders for ratification at the first general meeting after the appointment has been made. 

Rotation and succession planning
The Committee will discuss with the auditor the provisions the audit firm has in place for rotation of the lead engagement partner and the independent review partner. The Company shall require that the lead engagement partner and review partner be rotated at least every 5 years.

Management sign-off procedure
The Audit committee will ensure that the Chief Financial Officer and Chief Executive Officer (or equivalent) prepares a written statement to the Board certifying that the Company’s annual financial report and half yearly financial report present a true and fair view, in all material respects, of the financial condition of the Company and its operational performance and are in accordance with relevant accounting standards and the Corporations Act. 

The statement is to be presented to the Board prior to the approval and sign-off of the respective annual and half year financial reports.

This policy is reviewed annually.