Committee

ACCA - F1   ACCOUNTANT  IN  BUSINESS

 A committee is a small group of people, chosen by large group, to make decision in particular subject. Committee can be ad-hoc (temporary i.e. formed to address one-off/informal subject) or formal/standing (permanent as part of organisation that meets regularly e.g. Board of Directors). Board of Directors directs and controls organisation and is also known as steering committee. A steering committee is a group of high-level advisors who have been appointed to provide an organization or project with direction.

Committees within organisation:

Committees of directors: assist board in decision-making and policy process. E.g. audit/risk, nomination/remuneration, finance and policy governance.

Advisory committees: advisory committees advice on legal matters, general practices and international strategies.

Compliance committees: Compliance committees evaluates evaluate adherence to policies and review output. E.g. Quality compliance committee, Work/safety compliance committee and Ethical committee.

Divisional committees/Sub-committee: are established by divisions to enhance staff engagement. The committees represent the interests of staff within a particular group and act in an advisory capacity to the board, under agreed terms of reference or a charter.

Purpose of committee in an organisation:

Ø  Decision making

Ø  Relaying decisions and infrastructure

Ø  Brainstorming: free exchange to generate new ideas

Ø  Participative: problem solving

Ø  Providing advice and information

Consultation

Meeting process (Role of chairman and sectary of a committee)

Holding of meeting: which place, what time, (how many times a year?) frequency, type (face-to-face, telephone, video conference)

Quorum: small number of people who must be at the meeting before it can begin

Attendance and meeting procedures: who attend (committee members, their delegates and external parties invited), the chairs steers the committee (put forward the agenda to discuss, add emergency items, maintains order and keep to schedule)

Discussion and decision: Committee papers(Committee Secretary shall distribute agenda and related papers in advance of a meeting), Speaking, voting rights and contribution to the agenda

 Finalizing activities: Committee minutes (Committee Secretary shall prepare minutes of meeting and have them approved by the Committee Chair)

Committees represent shared responsibilities and ability to handle large volume of work between professional/specialized members from different fields. However, in certain situation the process can be lengthy, costly and dominating.

Checkout Audit and Risk committee for CPA Australia

ACCA Article: Corporate governance: The board of directors and standing committees