Audit committee

    ESG & Governance

    The board committee that oversees financial reporting, auditors, internal controls and related-party deals.

    Under Section 177 of the Companies Act and LODR Regulation 18, a listed company's audit committee must have at least three directors, two-thirds of them independent, with an independent chair, and all members financially literate. It must meet at least four times a year. It approves related-party transactions (only its independent members vote), recommends auditors, reviews results and oversees the vigil mechanism. It is the single most important committee for minority shareholders.

    Related terms

    Independent directorRelated-party transaction (RPT)Vigil mechanism

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