Board Committees

Audit Committee: For terms of reference please click here

Nominations Committee: For terms of reference please click here

Remuneration Committee: For terms of reference please click here

Audit Committee

Terms of Reference

Purpose

 

To define, sponsor and support all assurance activity (external audit, internal audit and risk management) within the Group and to fulfil the duties set out below in relation to the Group.

 

Constitution

 

The Board has established a Committee of the Board to be known as the Audit Committee, to assist the Board in fulfilling its oversight responsibilities and to fulfill the specific duties set out below.

 

Membership

 

The Committee shall be appointed by the Board and shall comprise not less than three members, who should all be independent non-executive Directors.  In the event that the Board composition does not enable this requirement to be met, the Board may appoint a non-executive Director to the Committee, taking into account the governance and oversight role performed by the Committee, provided that at all times there shall be a majority of independent non-executive Directors on the Committee.  A quorum shall be two members.

 

The Chairman of the Committee shall be appointed by the Board from amongst the members of the Audit Committee.

 

The Board shall keep the composition of the Audit Committee under review in the light of the recommendations of the new Combined Code and, as opportunities arise, seek to close any gaps between the current membership strategy and recommended best practice.

 

Secretary

 

The Company Secretary of Avis Europe plc shall act as the secretary of the Committee.

Attendance at Meetings

• The Chairman of the Board;
• Other non-executive directors who are not members of the Audit Committee;
• The CEO;
• The Group Finance Director;
• The Group Financial Controller;
• The Director of Risk Management & Internal Audit;
• The external auditor;
• Any outsource Internal Audit Partner provider; and
• Other persons as specified by the Audit Committee

Frequency of Meetings

Authority

• investigate any activity within its Terms of Reference.
• seek any information that it requires from any employee of the Group and all employees are directed to cooperate with any request made by the Committee.
• obtain any necessary outside legal or independent professional advice, at the Group's expense, and secure the attendance of external parties with relevant experience and expertise if considered necessary.

Duties

Financial Reporting

• review, and challenge where necessary, the actions and judgements of management, in relation to the Group's financial statements, including its annual and half-yearly reports, interim management statements, preliminary results' announcements and related documents and statements before submission to, and approval by the Board, and before final clearance by the auditors, focusing particularly on:
  • any changes in accounting policies and practices including
  • major judgmental areas;
  • the extent to which the financial statements are affected by any unusual transactions in the year and how they are disclosed;
  • the clarity of disclosures;
  • any significant adjustments resulting from the audit;
  • the going concern assumption;
  • compliance with accounting standards; and
  • compliance with stock exchange and legal requirements.
• discuss any issues arising from review of the interim report and audit of the full year financial statements, and any matters the auditor may wish to discuss (in the absence of management where necessary);
• review the interim and preliminary results announcements, the interim management statements, and any other formal announcements relating to the Group's financial performance prior to approval by the Board, including review of any significant financial reporting judgments contained therein;  and
• review the external auditor's Memorandum of Examination and management's response.

Internal Control and Risk Management

• review the Group's procedures for detecting fraud and whistleblowing and ensure that arrangements are in place by which any employee may, in confidence and for appropriate escalation (ultimately to the Chairman of the Audit Committee), raise concerns about possible improprieties in matters of financial reporting, controls or any other relevant matters;
• review management's and the internal auditor's reports on the effectiveness of the systems for internal financial control, financial reporting and risk management across the Group;
• monitor the integrity of the Group's financial controls;
• review the Group's statement on Corporate Governance prior to submission to the Board and in particular to review the effectiveness of the following:
  • internal control environment;
  • procedures for identifying business risks with possible mitigation and assessing their financial impact;
  • policies for preventing and detecting fraud; and
  • policies for ensuring that the relevant regulatory and legal requirements are complied with;  and
• assess the scope and effectiveness of the systems established by management to identify, assess, manage and monitor financial and operational risks.  Despite the delegation of aspects of the review to the Audit Committee it is acknowledged that the Board retains ultimate responsibility and must form its own opinion;
• consider the major findings of any internal investigations and management's response;
• review the annual risk management programme, and to ensure that risk management is embedded within all appropriate Group processes; and
• consider any such other relevant topics as the Board shall define.

Internal Audit

• review the internal audit programme and ensure that the Internal Audit function is adequately resourced and has appropriate standing within the Group;
• ensure that the Director of Risk Management & Internal Audit has direct access to the Board. Chairman and the Audit Committee and is accountable to the Audit Committee;
• receive regular reports on the work of Internal Audit and an annual summary of such activities;
• review and monitor management's responsiveness to Internal Audit's findings and recommendations;
• monitor and assess the role and effectiveness of the Internal Audit function in the overall context of the Group's risk management system; and
• approve the appointment or dismissal of the Director of Risk Management and Internal Audit.

External Audit

• oversee relations with the external auditor;
• approve the terms of engagement and the remuneration to be paid to the external auditor in respect of audit services provided;
• assess objectively the qualification, expertise,  resources, effectiveness and independence of the external auditor annually;
• discuss with the external auditor, before the audit commences, the nature and scope of the audit;
• review with the external auditors, the findings of their work, including any major issues that arose during the course of the audit and have subsequently been resolved and those issues that have been left unresolved; key accounting and audit judgements; levels of errors identified during the audit, obtaining explanations from management and, where necessary the external auditors, as to why any errors might remain unadjusted;
• review the audit representation letters before consideration by the Board, giving particular consideration to matters that relate to non-standard issues;
• assess, at the end of the audit cycle, the effectiveness of the audit process;
• review and monitor the content of the external auditor's Memorandum of Examination, in order to assess whether it is based on a good understanding of the Group's business and establish whether recommendations have been acted upon and, if not, the reasons why they have not been acted upon; and
• consider the nature of the engagement and fees associated with non-audit services and to develop and recommend to the Board the Group's policy in relation to the provision of such non-audit services by the external auditor; and
• consider, and make recommendations to the Board on the appointment, reappointment and removal of the  external auditor.

Reporting

• A summary of the role of the Audit Committee
• The names and qualifications of all members of the Audit Committee during the period
• The number of Audit Committee meetings and attendance by each member
• The way the Audit Committee has discharged its responsibilities

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Nominations Committee

Purpose

Composition and Meetings

Terms of Reference

• Regularly review the Board structure, size, composition and succession needs to ensure the required blend of skills and experience on the Board.
• Prepare a description of the role and capabilities required for a particular appointment and regularly review the profiles of the required skills and attributes for membership of the Board.
• Identify and nominate candidates for the approval of the Board to fill Director vacancies, ensuring that such candidates fit the specific profile and are evaluated against objective criteria, including having sufficient time available to devote to the requirements of the position.
• Liaise with the Remuneration Committee to ensure that the remuneration of newly appointed Directors is within the Company's overall policy.
• Ensure all Directors undergo an appropriate induction programme and to consider any training requirements for the Board as a whole. Individual training to be discussed and agreed with the Group Director HR & Corporate Affairs.
• Review annually succession plans for Directors and senior executives across the Group to ensure continuing management capability to match company development needs, ensuring adequate input from and to the Strategic Committee.
• Approve proposals for appointments to key management positions.
• Consider the reappointment of any non-executive Director at the conclusion of his or her specified term of office.
• Make recommendations regarding the membership of Board committees.
• Ensure that on appointment non-executive Directors receive a formal letter of appointment confirming what is expected of them including time commitments and committee service.

Reporting

• Review the section of the Company's Annual Report describing the work of the Committee, membership and attendance records.
• Chairman of the Nominations Committee shall attend the AGM and answer questions on the Committee's activities and responsibilities.
• Nominations Committee shall annually review its terms of reference and its own effectiveness and recommend any appropriate changes to the Board.
• Secretary of the Committee shall circulate minutes of meetings to members of the Committee.

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Remuneration Committee

Purpose

Composition and Meetings

Authority

• Determine and agree with the Board general policy on the terms of service, including remuneration, benefits, service agreements and pensions, of the Chief Executive, executive Directors, senior management and Company Secretary. In determining such policy, to ensure that appropriate incentives are provided to encourage enhanced performance and, in a fair and responsible manner, to reward individual contributions to the success of the Company.
• Determine the structure and allocation of the Company's long term incentive and share schemes, including setting appropriate performance targets, and advise the Board to seek shareholder approval where appropriate.
• Determine the total individual remuneration package of each executive Director, ensuring that performance related elements form a significant proportion of the total package. In so doing, to consult the Chairman and/or Chief Executive and Group Director HR & Corporate Affairs as appropriate.
• Determine the fees of the Chairman.
• Review the terms of Directors' service contracts, including termination payments and compensation commitments, giving due regard to the recommendations of the Combined Code and the UK Listing Authority listing rules.
• Review the terms of non-executive Directors' letters of appointment, giving due regard to the recommendations of the Combined Code.
• Liaise with the Nominations Committee to ensure that the remuneration of newly appointed Directors is within the Company's overall policy.
• Review annually the remuneration of Directors and senior management taking into account individual performance assessments, market data and employee increases elsewhere in the Group, and to determine increases, if any, as appropriate.
• Be aware of, and advise on, any major changes in employee benefit structures throughout the Group, including any all-employee share or profit related schemes.

Reporting

• Ensure that provisions regarding disclosure of remuneration, including pensions, as set out in the Directors' Remuneration Report Regulations 2002, are fulfilled.
• Produce an annual report of the Committee's remuneration policy, membership and attendance records for review by the Board.
• Chairman of the Remuneration Committee shall attend the AGM and answer questions on the Committee's activities and responsibilities and on the Remuneration Report.
• Remuneration Committee shall annually review its terms of reference and its own effectiveness and recommend any appropriate changes to the Board.
• Secretary of the Committee shall circulate minutes of meetings to members of the Committee.

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