Audit Committee Work Guidelines and Regulations

The Audit Committee's Work Guidelines and Regulations were prepared as part of BCA Syariah's commitment to implementing good corporate governance

The Audit Committee is established by and reports to the Board of Commissioners to work collectively and assist the Board of Commissioners in overseeing the Bank's operations and providing advice to the Board of Directors.

Audit Committee Charter

In performing its duties at the Bank, the Committee has a Committee Charter that contains guidelines and working procedures based on the Board of Directors' Decree concerning Good Corporate Governance Policies. It includes guidelines on the Committee's duties and responsibilities, structure, description of activities and authorities, working hours, and meeting arrangements. The GCG Manual is compiled based on applicable regulations and laws and is periodically reviewed.

Here is a summary of the Guidelines and Working Procedures of the BCA Sharia Audit Committee:

Structure and Composition of the Audit Committee

The following is the structure and membership of the Audit Committee:

  1. Audit Committee members are accountable to the Board of Commissioners.
  2. Audit Committee membership consists of at least:
    • An Independent Commissioner who serves as the Chairman of the Audit Committee.
    • One Independent Party with expertise in financial accounting and one Independent Party with expertise in Sharia banking.
  3. Audit Committee members are not members of the Board of Directors of BCA Sharia or other banks.
  4. The majority of Commissioner members who are Audit Committee members must be Independent Commissioners.
  5. The appointment of Audit Committee members is made by the Board of Directors based on the Board of Commissioners' Meeting Resolution.

Membership Requirements

Requirements to be fulfilled by Audit Committee members include:

  1. Audit Committee members from Independent Parties must come from outside BCAS, have no financial, managerial, share ownership, and/or family relationships with the Board of Commissioners, Board of Directors, and/or controlling shareholders or relationships with BCAS that could affect their ability to act independently.
  2. All Independent Parties from former BCAS Directors (if any) who do not perform supervisory functions that could affect their ability to act independently must have undergone a cooling-off period of at least 6 (six) months. This cooling-off period does not apply to former Directors of BCA Sharia who perform supervisory functions, namely the Compliance Director.
  3. Audit Committee members must have good financial integrity and reputation, including:
    • Having good morals and ethics, high responsibility, and a strong commitment to accountability.
    • Commitment to comply with Sharia banking regulations and other applicable laws and regulations.
    • Having sufficient knowledge to read and understand financial reports.
    • Not being listed in the bad credit list.
  4. All Independent Party Committee members do not have financial, managerial, share ownership, and/or family relationships with the Controlling Shareholders, members of the Board of Commissioners, and/or members of the Board of Directors or financial and/or share ownership relationships with the Bank that could affect their ability to act independently.

Independence of the Audit Committee

All Audit Committee members are independent parties, meaning they have no financial, managerial, share ownership, and/or family relationships with members of the Board of Commissioners, members of the Board of Directors, and/or Controlling Shareholders or business relationships with the Bank that could affect their ability to act independently.

Concurrent Positions

  1. The Chairman of the Audit Committee can only hold a maximum of 1 (one) position as Chairman in another Committee at BCA Sharia.
  2. Audit Committee members from Independent Parties can concurrently hold positions as Independent Parties in other Committees at BCA Sharia, other banks, and/or other companies, provided that they:
    • Meet independence criteria.
    • Meet expertise criteria.
    • Are able to maintain bank confidentiality.
    • Adhere to applicable codes of ethics.
    • Do not neglect the performance of their duties and responsibilities as Audit Committee members at BCA Sharia.

Tasks and Responsibilities

The main tasks and responsibilities of the Audit Committee are to provide opinions to the Board of Commissioners on reports or matters submitted by the Board of Directors to the Board of Commissioners, identify matters requiring the attention of the Board of Commissioners, and perform other tasks related to the duties of the Board of Commissioners, including:

  1. In carrying out the internal audit function, the Audit Committee is responsible for:
    • Monitoring and reviewing the effectiveness of the Bank's internal audit implementation;
    • Evaluating the performance of the Internal Audit Work Unit (SKAI);
    • Ensuring SKAI communicates with the Board of Directors, Board of Commissioners, Sharia Supervisory Board for Sharia commercial banks, and conventional commercial banks with Sharia business units, external auditors, and the Financial Services Authority;
    • Ensuring SKAI works independently;
    • Providing recommendations to the Board of Commissioners regarding the preparation of SKAI's audit plan, scope, and budget;
    • Reviewing audit reports and ensuring the Board of Directors takes prompt corrective action to address control weaknesses, fraud, compliance issues with policies, laws, and regulations, or other issues identified and reported by SKAI;
    • Providing recommendations to the Board of Commissioners regarding the overall annual remuneration of SKAI and performance awards; and
    • Ensuring SKAI upholds integrity in carrying out its duties.
  2. Providing recommendations on the appointment of Public Accountants and Public Accountant Offices registered with the Financial Services Authority to the Board of Commissioners and coordinating with Public Accountant Offices for the effective implementation of external audits.
  3. In order to fulfill the above responsibilities and provide recommendations to the Board of Commissioners, the Audit Committee must monitor and evaluate at least:
    • The implementation of tasks by the Internal Audit Work Unit (SKAI).
    • The compliance of audits by Public Accountant Offices with applicable Audit Standards.
    • The conformity of Financial Statements with applicable Accounting Standards.
    • The implementation of follow-up by the Board of Directors to audit findings and/or recommendations from SKAI, Sharia Supervisory Board, external auditors, and the results of Financial Services Authority (OJK) supervision.
  4. Developing and/or updating Guidelines and Working Procedures for the Audit Committee.

Ethics and Working Hours

  • Work Ethics: Audit Committee members must adhere to the BCA Sharia Code of Ethics.
  • Working Hours: The Audit Committee must allocate sufficient time to carry out its duties and responsibilities optimally.

Audit Committee Meetings

Mechanism and Decision-Making of Meetings

The following are provisions regarding Audit Committee Meetings:

  1. Audit Committee Meetings are held according to the needs of BCA Sharia and at least 4 (four) times a year.
  2. Audit Committee Meetings can only be held if attended by at least 51% (fifty-one percent) of the total members and attended by the Chairman of the Audit Committee and Independent Parties.
  3. Audit Committee Meeting decisions are made based on consensus.
  4. In the absence of consensus, decisions are made based on the majority vote.
  5. The Chairman of the Audit Committee and each member have one voting right each.
  6. All Audit Committee decisions are binding on all Audit Committee members.

Meeting Minutes

The following are provisions regarding Audit Committee Meeting Minutes:

  1. The results of Audit Committee Meetings must be documented in Meeting Minutes signed by all attending Audit Committee members and well-documented.
  2. Dissenting opinions that occur in Audit Committee Meetings must be clearly stated in the Meeting Minutes, along with the reasons for the dissenting opinions.
  3. Copies of the Audit Committee Meeting minutes signed by all attending Audit Committee members must be distributed to all Audit Committee members.
  4. All Audit Committee decisions recorded in the Meeting Minutes are joint decisions of all Audit Committee members.