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MOTOR VEHICLE COMPREHENSIVE INSURANCE(NEW)
MOTOR VEHICLE COMPREHENSIVE INSURANCE(OLD)
COMPREHENSIVE THIRD PARTY LIABILITY (CTPL)

AUDIT COMMITTEE CHARTER

 

I. Purpose of the Audit Committee

The Audit Committee (the “Committee”) of the Board of Directors (the “Board”) of TRAVELLERS INSURANCE & SURETY CORPORATION, Inc. (“TRISCO”) assists the Board in its oversight of :

  1. The qualifications, independence and performance of TRISCO’s independent auditor and
  2. The performance of TRISCO’s internal audit function

II. Responsibilities

The primary responsibility of the Committee is to exercise its business judgment, in carrying out the responsibilities described in this Charter, in a manner the Committee members believe to be in the best interests of TRISCO and its shareholders.

The preparation of TRISCO’s financial statements, in accordance with generally accepted accounting principles, is the responsibility of management.

The independent auditor is responsible for the planning and conduct of audits and determining whether the financial statements present fairly, in all material respects, TRISCO’s financial position and results of operations.

III. Committee Membership

The Committee shall be comprised of at least three directors. All members of the Audit Committee must be non-executive Directors and at least a majority of the Audit Committee must consist of Independent Directors.

Audit Committee must be chaired by an independent director. Each member of the Committee shall be “financially literate” and at least one member of the Committee shall have accounting or related financial management expertise.

Determination of independence, audit committee financial expertise, financial literacy and accounting or related financial management expertise, shall be made by the Board. The Board evaluates such qualifications based on its business judgment and in accordance with applicable laws.

The duration of the mandate of a member of Audit Committee may not exceed the duration of his or her mandate as a Director.

IV. Organization

The Committee will meet at least four times a year or more frequently, as it deems necessary or appropriate to carry out its responsibilities. A majority of the members shall constitute a quorum.

The Chairman shall, in consultation with other Committee members, set the agenda for and preside at meetings of the Committee. The Secretary of TRISCO or another designated individual shall record and keep minutes of all Committee meetings.

V. Internal Audit

  1. The Committee shall review the organization of the internal audit department, the adequacy of its resources and the competence of its staff.
  2. The Committee shall perform the following:
    1. review and approve the appointment, replacement, reassignment or dismissal of the Internal Audit Head, who shall report directly to the Committee
    2. be involved in performance reviews of the Internal Audit Head and
    3. review and set the compensation of the Internal Audit Head .

VI. External Audit

  1. The Committee, in its capacity as a committee of the Board, shall be directly responsible for the appointment, compensation, retention and oversight of the work of the independent auditor and any other registered public accounting firm retained for the purpose of preparing or issuing an audit report or performing other audit, review, or attestation services for TRISCO.
  2. The Committee shall review with the independent auditor the following:
    1. any management letter provided by the independent auditor and management’s response thereto
    2. a summary of the major audit reports issued by the internal auditor department and management’s response thereto
    3. any accounting adjustments that were noted or proposed by the independent auditor but were “passed” (as immaterial or otherwise).
  3. The Committee shall review with the independent auditor, audit problems or difficulties encountered by the independent auditor in the course of its annual audit work and management’s response, including any restrictions on the scope of the independent auditor’s activities or access to required information and any significant disagreements with management.
  4. The Committee shall assure the regular rotation of the lead audit partner and shall consider and discuss with management, whether there should be a regular rotation of the independent auditor itself.

VII. Operation

  1. Each member of Committee has access to the books, data and offices of the TRISCO and may have conversations with executives and employees of the TRISCO.
  2. Chairman of the Board has a permanent invitation to attend the meetings of the Audit Committee, even if he or she is not a member of the Audit Committee.
  3. The Committee may request attendance of any officer or representative of TRISCO in its meetings.

VIII. Communication with Management and Employees

  1. The Committee shall discuss with management, the internal auditors and the independent auditor major issues regarding the following:
    1. adequacy of TRISCO’s internal controls
    2. audit steps adopted in light of material control deficiencies
    3. analyses prepared by management and/or the independent auditor, setting forth significant financial reporting issues and judgments made, in connection with the preparation of TRISCO’s financial statements and
    4. any fraud, material or otherwise, that involved management or other employees who have a significant role in TRISCO’s internal controls and that have come to the attention of management, the internal auditors or the independent auditor.
  2. The Committee shall handle complaints received regarding accounting, internal accounting controls or auditing matters.
  3. The Committee shall report regularly to the Board. The Committee shall review with the Board, any significant issues that arise with respect to the quality or integrity of TRISCO’s financial statements, the performance and independence of TRISCO’s independent auditor and the performance of the internal audit function.

VII. Committee Self-Assessment

The Committee shall conduct an annual evaluation of its performance and report the results of such review to the Board. In connection with that annual review, the Committee shall also recommend to the Board, any modifications of this Charter that the Committee deems necessary or appropriate. The format of the self-assessment shall be determined by the Committee.

VIII. Resources and Authority of the Committee

The Committee shall have direct access to complete and open communication with senior management and may obtain advice and assistance from internal legal, accounting and other advisors to assist it. In performing its functions, the Committee is entitled to rely on the findings, advices, reports and opinions of management as well as legal, accounting and other advisors retained by TRISCO. The Committee may retain, if appropriate, independent legal, accounting, and other advisors to assist it and may determine the compensation of such advisors. TRISCO shall be responsible for any costs or expenses so incurred.

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(632) 8400-9327
(632) 8521-3822

(632) 8521-4931
(632) 8525-1119

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