Day: November 6, 2025

Which ONE of the following statements about audit committees is incorrect?

Select ONE answer:

1. Listed companies are required to have an audit committee
2. Audit committees are considered to be good practice for all large companies
3. If a company has an internal audit function, the chief internal auditor should sit on the audit committee
4. Audit committees are an important aspect of a company’s control environment 

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct => The chief internal auditor does not sit on the audit committee, but should ideally report directly to this committee.
4. Not correct

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