Answer Happy

Ghana Sugar Company Limited a private company has been in
operation for many years. Owing to a rising need to raise
additional capital the shareholders have passed a resolution to
convert the company into a public company and list it on the Ghana
Stock Exchange. You have been contracted to help the Directors to
carry the resolution through. During your preliminary discussion
with the Directors you realised that they were not very conversant
with the listing rules of the Ghana Stock Exchange and you drew
their attention to the establishment of an Audit Committee as a
condition for listing on the Ghana Stock Exchange. The Directors
agreed to discuss the establishment of the Audit committee at the
next emergency meeting and invited you to be present. You are
required to: a) Recommend the composition of the audit committee
and describe its responsibilities to the Directors. b) Explain how
an audit committee could improve the effectiveness of the work of
the external auditor. Some audit committees are expanding their
functions to include oversight over risk management processes. c)
Explain two risk management practices the audit committee can put
in place to mitigate the risks of a company