MFDF Insights: Audit Committee Chair Series

As part of MFDF’s Audit Committee Chair’s Guide program series, David Roeber, investment management partner at Stradley Ronon and John Braun, audit partner at Cohen & Co., led an “In Focus” discussion program to answer questions that are top-of-mind for registered fund audit committee chairs. The following represent some of the questions discussed by independent directors and the expert presenters.
Q: How can audit committees think about succession planning?A: Succession planning is an important part of audit committee oversight, particularly for audit committee chairs and audit committee financial experts who work closely with management and the auditor. Committees may want to consider retirement timelines and stagger transitions to avoid multiple departures at once. Some committees also implement planned rotation of the audit committee chair to promote continuity and create leadership opportunities.
Q: Can the same audit firm serve as the auditor of a fund and the fund’s adviser?A: Independence is evaluated separately for the adviser and for registered funds.  If the audit firm can satisfy both sets of independence requirements, it may serve in both roles. Conflicts can sometimes be mitigated if the audit firm chooses not to provide certain non-audit services that are inconsistent with independence. PCAOB has provided guidance to help assess potential conflicts.
Q: When a fund changes auditors, what role does an audit committee member have?A: Audit committee members may be asked to participate in interviews with potential new audit firms if a transition is planned. The audit committee retains ultimate responsibility for the selection and oversight of the audit firm, and audit committee members may wish to speak directly with the engagement partner to understand how the relationship would function and what the transition process would entail.
Click here to check out MFDF’s upcoming discussions and join the conversation with your peers. Please note, “In Focus” programs are only open to fund directors and CCOs and are not recorded.Click here to watch the June audit committee webinar archived video.Click here to watch the September audit committee webinar archived video. 

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