The role of audit committees in UK universities

Abstract

Audit committees have a relatively long history dating back to the nineteenth century. It is only in recent years that their use has been popularized again in the private sector. Fundamentally, it is often argued that audit committees exist to mediate between executive directors and auditors while providing an overall enhancement of corporate accountability. One of the recent effects of the drive to incorporate business methods into other sectors has been the establishment of audit committees. It does, however, pose the question of the role of these committees which are operating in a different context from their origins. Looks at the operation of audit committees in a defined sector, namely universities. Using a postal questionnaire, all directors of finance (or equivalent) in UK universities were surveyed to establish whether or not audit committees existed in their institutions, the purpose being to determine the extent of audit committees, the reasons why they have or have not been established, and the advantages and problems encountered with them. One interesting result that arose with implications for accountability and governance was that in universities the stewardship and strategic policy‐making functions are generally separate and that audit committees report only on the former. This is in contrast to the situation in the private sector where both functions are generally combined in the activities of the board of directors. Because there is considerable overlap between the membership of audit committees and the boards of directors, it could be argued that this provides the potential for a greater degree of accountability and governance than currently exists in universities.

Exploring the oversight of risk management in UK higher education institutions: the case of audit committees

“…In doing so, this paper extends the limited, but gradually emerging qualitative evidence that allows researchers, practitioners and policy makers to peer into the 'black box' of the audit committee (Gendron et al, 2004;Turley & Zaman, 2007;Bailey & Peck, 2013). Furthermore, the findings contribute to the largely descriptive evidence on the adoption of audit committees by UK HEIs (Dewing & Williams, 1995) and to the recent insights by Christopher (2012) on the interplay between risk management and internal audit functions in Australian universities.…”

“…The findings first reveal a proliferation of the risk language and discourses in the oversight of HEIs, which can be mainly ascribed to the UK's HEI regulatory framework, and subsequently to the influence of AC members themselves due to their own expectations that risk management oversight activities 'ought' to be present within the institution. This is a departure from the early evidence on ACs gathered by Dewing & Williams (1995) and provides an additional insight as to the oversight role of the AC on risk management in relation to the internal audit function (Christopher, 2012). Second, what is peculiar in this case is that the AC is predominantly concerned with the monitoring of processes.…”

“…Although there appears to be a great deal of sector-based guidance, there is scant evidence on how the above requirements have been implemented by HEIs and/or are monitored by the AC. For instance, Dewing and Williams (1995) studied ACs in UK universities using a questionnaire survey of 87 university finance directors. Although they revealed that 90% of the UK universities had established an AC with the primary task of securing internal and external accountability, the risk oversight task was not reported as an important role for ACs.…”

Developing a Tool for Quality and Accreditation of a New Generation University in the Digitalized Society: The Case of a Thematic-Technical University

“…The committees and boards will need to be designed and operated as complementary and supportive. The most effective way of stakeholders' active engagement will be the creation and operation of committees and boards, and these bodies will be the most important instrument for the university system to remain updated and dynamic (Lombardi et al, 2019;Dewing and Williams, 1995).…”

The Audit Committee: Performing Corporate Governance

“…Audit committees have been established in National Health Service Trusts and in universities (Dewing and Williams, 1995) and the Review of Audit and Accountability for Central Government (Sharman, 2001) recommended that all UK government departments should have an audit committee but very little research has yet been undertaken into their role in public sector and not-for-profit organisations. An approach similar to that used in this study could be employed to explore the development of audit committees in these institutions.…”