Your audit committee might need a new focus, a risk committee

It's clear that audit committees today are quickly evolving into perhaps the most likely for controversy and perhaps even liability. It's not the posh job it was once. The problem is that the new focus comes on top of the old focus. So while many acknowledge the importance of risk oversight, the actual time devoted to the issue may be lacking, according to a recent survey by Ernst & Young. A majority of survey participants said 20 percent or less of the audit meeting time is devoted to risk. Also, only about half of audit committee say they receive necessary quarterly or monthly updates. The problem is worth addressing now. One idea would be to set up a risk committee. Currently, only 18 percent of companies have such committees, which would meet regularly with regulators (only 20 percent do that now) and set up an on-going risk evaluation and monitoring process. In general, the time issue is big one, given the twin burden of stepped up audit responsibilities and general board duties. Unsurprisingly, some companies have begun limiting the number of boards on which directors can serve. All in all, audit committee members are certainly earning their pay these days.

For more:
- here's a summary of the study from EarthTimes