Read the Terms of Reference for our Oversight Committee

Oversight Committee (‘OC’)

Terms of Reference

Membership

The Oversight Committee (OC) shall comprise of:

• All the Independent non-executive (INE) members appointed in accordance with the FRC Audit Firm Governance Code
• The Managing Partner
• Two other Partners of the firm

The two other Partners of the firm will be selected by the firm’s Management Board from the nominations received from the partnership.

Only the elected Partners and Managing Partner shall be full voting members of the OC.

The Partnership Secretary shall act as Secretary to the Committee and provide support as required.

The voting members of the OC shall appoint an INE to be the Chair of the Committee. In the absence of the Committee Chair, the remaining members present shall elect one of themselves to chair the meeting.

Meetings and attendance

The Committee shall meet a minimum of four times per year. Further meetings may be called by any member of the Committee if required.

The quorum for meetings shall be two thirds of voting members and two thirds of INE’s.

Notice of each meeting confirming the venue, time, and date, together with an agenda of items to be discussed, shall be made available to each member of the OC in sufficient time to enable consideration of the issues.

Supporting papers will be made available in electronic form to OC members at least the weekend before the meeting is taking place.

Meetings can be held physically or virtually.

Only members of the OC have the right to attend meetings. Other guests (both internal and external to the Firm) may attend by invitation.

Role and responsibilities

The primary focus of the OC is to oversee the stewardship, accountability, activities and leadership of management of the Firm and to provide clear sighted counsel on the strategic direction of the Firm and the alignment to principles A to Q set out in the FRC Audit Firm Governance Code (April 2022).

In carrying out its role the OC will seek to balance the interests of the various stakeholders to whom it is responsible in order for the Firm to have a successful and sustainable future.

As such, the Committee shall carry out the following:

• The Managing Partner meet with OC and present the draft plan and priorities for the Firm (the “Strategic Plan”) as prepared by the Management Board before these are presented (in full or in summary form) to the Partners as a whole. The purpose of this presentation is to enable the OC to raise questions and to challenge the Strategic Plan and underlying key assumptions and supporting papers before the Strategic Plan is finalised.
• It should be noted that interaction with the OC is not limited to just the Managing Partner.
• The Managing Partner shall meet with the OC to discuss any material variations they propose to make to the Strategic Plan before these are presented to the Partners as a whole. The purpose of this meeting is to enable the OC to raise questions and to challenge the proposed material variations before they are finalised.
• If the Managing Partner believes that a material departure from the Strategic Plan has occurred, or is likely to occur, they shall meet with the OC to discuss the circumstances of such departure. The purpose of this meeting is to enable the OC to raise questions and to challenge any resultant material actions proposed
  
• At each meeting:
  • Review the minutes and reports from the Management Board;
  • Review the minutes and reports from the Risk Committee;
  • Review the minutes and reports from the Audit Quality Board Committee;
  • Review the minutes and reports from the Public Interest Committee; and
  • Review the management accounts of the firm
    
• On an annual basis the OC shall:
  • Satisfy themselves that the risk management policies, level of professional indemnity cover and other material business policies proposed in relation to those matters which are fundamental to the protection of the Firm, are appropriate;
  • Satisfy themselves that there are adequate provisions to enable the assessment of progress in implementing the Strategic Plan and review whether they continue to be appropriate in respect of unforeseen events;
  • Satisfy themselves that the Management Board are setting the right tone at the top to ensure that the culture in the Firm is being imbedded;
  • Undertake an annual budget review;
  • Satisfy themselves that the remuneration policy has been followed;
  • Review the management accounts of the Firm pursuant to clause 25 of the Audit Firm Governance Code; and
  • The OC shall confirm annually to the Partners as a whole that the OC has compared the progress of the Firm with the Strategic Plan, reported any concerns to the Management Board as appropriate, and is satisfied with the response provided by the Management Board. Any follow up action take needs to be acknowledged and agreed.
    
• As required:
  • Confirm an increase or decrease in the total number of Partners or employees by 20% or more in anyone Accounting Period;
  • Approve the opening or closure of an office, commencement or disposal of a service line, or business combination or disposal, which would change respectively the planned gross revenue by 10% or more;
  • Approve any capital or investment expenditure or disposals of £10,000,000 or more;
  • Approve entering into property leases where the aggregate commitment up to the first available date pursuant to an option in favour of the LLP is £2,500,000 or more;
  • Approve the provision by the Firm of a guarantee, indemnity or other commitment of £2,500,000 or more (other than by a Partner in the ordinary course of acting as an officeholder in an insolvency proceeding);
  • Approve any new or amended borrowing or financing arrangement in excess of £10,000,000.
  • Approve any proposals made by the Management Board to vary any of the provisions in the Membership Agreement relating to financial settlements for Outgoing Partners
  • Approve the criteria applied in accordance with the Membership Agreement for the removal of Partners and the process to be followed; and
  • Hearing appeals from Outgoing Partners.
    

Legal advice

• The OC shall be entitled, at the cost and expense of the Firm:
  • to take such legal advice as they think fit on behalf of the Firm from the internal legal team and/or external legal advisers, regarding any matter relating to the Firm, the LLP Business, a Partner or Outgoing Partner. Any such advice so obtained by the OC shall be confidential and shall enjoy legal privilege. The OC shall be entitled to disclose such advice to any such Partner or Partners or members of the Management Board as they think fit to the exclusion of others and to make such disclosure subject to such conditions as to confidentiality or otherwise. The OC shall be entitled to withhold any such advice from the Partner or Outgoing Partner to whom it relates, and the Partner or Outgoing Partner concerned shall not be entitled to have any such advice disclosed to them or to enjoy or exercise any right to be provided with such advice which they might otherwise have but for the provisions of this paragraph; and
  • to take such action as the OC may think fit to enforce any of the obligations of any Partner or Outgoing Partner or otherwise in accordance with the Membership Agreement or the FRC Audit Firm Governance Code to protect the interests of the Firm.