Finance, audit and risk management committee terms of reference

Page last updated 5 September 2025

Objective

The RACGP is a registered charity and specialised GP medical training college accredited by the Australian Medical Council (AMC). The Finance, Audit and Risk Management (FARM) Committee’s core role is to support the delivery of the goals and objectives of the RACGP. In fulfilling this role, the FARM Committee assists the Board in fulfilling its oversight of the following activities:

Financial management and reporting.
Internal and external audit.
Risk management, including business continuity, compliance and internal controls.
Grant management, including the Australia General Practice Training (AGPT) agreement.
Investment strategy.
Asset and Property strategy.
Technology strategy.
Insurance program.
Legal and compliance.

Duties and responsibilities

In assisting the Board, the Committee will:

Financial management and reporting:
- Provide strategic financial advice.
- Review and recommend approval to the Board of the annual budget, including key assumptions.
- Monitor financial performance reporting against budget and forecast.
- Advise on the integrity and transparency of financial reporting processes.
- Review and recommend to the Board for approval the annual audited financial statements and directors’ reports.
- Review and refer to the Board financial statements, including an executive summary, profit and loss statements, balance sheet and projected cash flow statements.
- Oversee the appropriate application and review of accounting and financial management policies and procedures, including the Delegations Policy and Instruments.

Internal and external audit:
- Oversee the relationship with auditors, including appointment, re-appointment, tenure, fees and terms of engagement.
- Review and discuss audit findings, management letters and recommendations with auditors.
- Oversee internal audit processes and ensure implementation of audit recommendations.
- Monitor the independence of the internal and external audits and the internal and external audit function.
Internal audit:
- Review and assess the scope of the internal audit and the audit plan, as well as the systems to monitor and evaluate the effectiveness of the internal auditor.
- Monitor the internal auditor reports to the Board via the FARM Committee.
- Review the appointment of an internal auditor at least every three years with the appointment not to exceed a cumulative period of five years. An external tender must be sought at the latest by the end of every five years.
External audit:
- Review the scope of the external audit including identified risk areas and any additional agreed-upon procedures.
- Review and assess non-audit services, with consideration given to the potential for the provision of these services to impair the external auditor’s judgment or independence
- Review the appointment of an external auditor at least every three years.
  - A Partner is required to be rotated every five years.
  - An external tender is to be sought at the end of every five years.
Risk management:
- Oversee the development and regular review of the risk management framework and that it effectively identifies areas of potential risk and builds risk maturity across the organisation.
- Oversee the process to assess risk tolerance and appetite, ensuring risks are managed within approved levels.
- Review reports on material breaches or risk limits and adequacy of management’s response.
- Monitor compliance with internal controls and report on non-compliance.
- Oversee that the RACGP’s anti-fraud programs and controls are adequate.
- Ensure that policies and procedures have been designed and implemented to manage identified risks, including Business Continuity Planning and Disaster Recovery.

Grant management:
- Monitor achievement against the Key Performance Indicators set out in grant agreements, including the AGPT agreement.
- Monitor financial performance reporting against funding grants.
- Review and recommend to the Board the AGPT funding agreement compliance report.
- Consider and assess future funding and cost structures of GP training.

Investment strategy:
- Review and recommend to the Board the investment strategy including financial and property/assets.
- Advise and monitor the operation of the Treasury and Investment Policy.
- Advise and assist the Board on the development of investment objectives consistent with the Treasury and Investment Policy.
- Monitor and review the investment philosophy of the RACGP as outlined by the Board and stated in the Treasury and Investment Policy.
- Periodically review the Treasury and Investment Policy.
- Monitor that investments are aligned with RACGP objectives.
- Endorse management’s recommendation on the selection of the Investment Adviser to the Board following the procurement process.
- Manage and review the performance of the Investment Adviser and the investments on a periodic basis at least once every six months.
- Submit Investment Adviser recommendations to the Board, report to the Board periodically on key investment metrics, possible compliance breaches and any other investment information requested by the Board and as required by the Treasury and Investment Policy (if any).

Asset and Property strategies:
- Oversee and review significant property projects and investments.
- Review and recommend strategic priorities to the Board for assets and property and ensure the asset and property strategies and initiatives are aligned with the RACGP’s strategy and support organisation’s objectives.
- Ensure compliance with relevant laws, regulations and governance frameworks.
- Evaluate asset, IP and property-related risks and oversee risk mitigation strategies.
- Review and endorse the property strategy.

Technology strategy:
- Oversee and review significant technology-related projects and investments, including KPIs and metrics for areas including cybersecurity, digital and AI.
- Review and recommend strategic priorities to the Board for technology and ensure technology strategy and initiatives are aligned with the RACGP’s strategy and support organisation’s objectives.
- Advise on compliance with relevant laws, regulations and governance frameworks relating to IT, including AI, data privacy and information management.
- Evaluate technology-related risks, including cybersecurity threats, and oversee risk mitigation strategies.
- Review and endorse the data governance strategy.

Insurance program:
- Oversee the insurance program to provide oversight of insurable risk identification.
- Monitor and review insurance and litigation claims and adequacy of insurance coverage.

Legal and compliance:
- Review and report to the Board on compliance with laws and regulations (particularly those which have a major potential impact on the RACGP in areas such as trade practices, occupational health and safety, and the environment).
- Monitor compliance with corporate governance practices and regulations including ACNC Rules, Corporations Act and AASB requirements and other best practice corporate governance processes.
- Review and recommend to the Board for approval compliance policies, including Whistleblowers, Privacy, Conflicts of Interest and Related Party Transactions and Fraud and Corruption Prevention policies.
- Review and recommend to the Board compliance reporting, including ESG and Modern Slavery.

Membership

Members are appointed by the Board and composed of at least six members, the majority of whom must have financial competency:

Chair appointed by the Board, who is an independent member with finance, audit and risk management expertise.
the President.
up to three co-opted independent members with appropriate expertise in a priority skills area identified as part of the Board’s evaluation process.
one co-opted member with expertise in GP training and compliance with the AGPT Agreement.
two or more RACGP Board Members.

In addition, the following officers have standing invitations to all meetings, to participate in discussions, receive agendas and minutes but not be counted in the meeting quorum or voting:

Chief Executive Officer.
Chief Financial Officer.
Deputy Chief Financial Officer.
General Counsel.
Company Secretary.

Other parties may attend meetings at the invitation or request of the FARM Committee Chair as observers, guests, or advisors, including but not limited to staff and members of other Board or Advisory Committees.

Terms of appointment

Independent, co-opted members are appointed for three-year terms and may be appointed for up to three consecutive terms (nine years), based on performance and/or the priority skills and experience required by the Committee.

Where a member retires before the date of reappointment or no longer holds the position which gave rise to their membership on the FARM Committee, a new member may be appointed for the remainder of the term of appointment, provided the appropriate composition is maintained.

Remuneration

Co-opted independent committee members are entitled to receive a fee as approved by the RACGP Board.
Committee members are entitled to receive reimbursement of any reasonable travel, accommodation or other incidental expenses incurred with the prior approval of the relevant RACGP manager, in accordance with the RACGP Travel and Hospitality Policy.

Secretariate

To be provided by the Executive Support Officer – Corporate Services.

Meetings

The Committee meets six times per year and more frequently if required, using any means of audio or audio-visual communication, as long as each Committee Member can hear and be heard by each other Committee members participating.

Quorum is a majority of the members.

If at any meeting the Chair is not present within 10 minutes after the time appointed for the holding of the meeting, the members present may choose one of their number to chair the meeting.

Decisions of the FARM Committee will be determined on a majority of votes of those present and entitled to vote.

Chair’s Role

The Chair’s responsibilities are to ensure:

the committee’s deliberations are consistent with RACGP policies and with these terms of reference.
an annual committee workplan and meeting calendar is set, with three days’ notice provided should a meeting need to occur at short notice.
members receive an agenda and the pre-reading materials at least five business days prior to each meeting.
meetings are carried out in a fair and impartial way allowing each member to contribute to the discussions with a view to the committee arriving at a consensus on an issue.
a full and frank discussion takes place about the matters under consideration.
the minutes are approved by the members present at the meeting.
outcomes are recorded and a report is provided to the Board.
issues of importance are brought to the attention of the Board between meetings.

Access to Information and Independent Advice

The Committee may obtain independent advice as it considers necessary to support the delivery of its duties and responsibilities and must notify the Board should this occur.

Authority and responsibilities

The Committee is advisory only to the Board and will conduct its business in accordance with its terms of reference, the RACGP’s Constitution, the Board approved Delegations Policy and Instruments and any other policies approved by the Board. The Committee has no executive decision-making power.

A workplan will be developed annually for noting by the Board.

The Committee reports to the Board and must circulate its minutes to the Board as soon as practicable after each meeting, along with a report from the Committee Chair on key outcomes and recommendations.

Sub-committees

The FARM Committee may establish sub-committees to support its activities and notify the Board should this occur. The committees will conform to the Terms of Reference approved by the Board for the FARM Committee.

The current sub-committee is: Digital and Technology Steering Committee.

Confidentiality

Committee members will receive or have access to confidential, sensitive and personal information. They acknowledge they must only use or disclose such information to the extent necessary to satisfy their duties and responsibilities.
if there is uncertainty as to whether any information is confidential, such information is deemed confidential and not within the public domain.
Committee members must safeguard the confidentiality of any information received by adopting and maintaining reasonable precautions.
Committee members must not make any press or other announcements or releases in connection with any deliberations, outcomes or decisions of the Committee.
Committee members must notify the RACGP Chair or Company Secretary if they become aware of any actual, suspected or likely disclosure of confidential information.
if requested by the RACGP Chair, Company Secretary or their delegate, Committee members must return or destroy any information (whether confidential or not) in their control or possession that they have received in connection with their role as Committee members.

Conflicts of Interest

Committee members must disclose any actual, potential or perceived conflicts of interest, including any financial or other interest, to the Chair as soon as they become apparent.

Committee members must comply with the RACGP Conflict of Interest and Related Party Transactions Policy.

Review

The Committee will review its performance and its terms of reference annually and report to the Board on its performance and fulfillment of its role as per this terms of reference.

The terms of reference are approved by the Board of Directors.

Definitions

Independent Member means a member of the FARM Committee who is:

not an employee, contractor, consultant, supplier or is otherwise engaged or paid by the RACGP (except for any remuneration received by the Independent Member in connection with their role as a member of the FARM Committee).
other than in connection with their role as a member of the FARM Committee, not involved in the management or operation of the RACGP.
is not a spouse, de facto spouse, parent, child or close relation of any person who is a member of the FARM Committee or RACGP Board.
is free from any interest and any business or other relationship that could, or could reasonably be perceived to, materially interfere with the member’s ability to act in the best interests of the RACGP.

Investment Advisor is a firm or person engaged by the RACGP to invest funds on its behalf.

Version History

Release Notice
Version	Date of effect	Amendment details	Amended by
1.0		Initial release	Manager, Risk and Compliance
1.1		Minor amendments upon commencement of new FARM	Manager, Risk and Compliance
1.2	3 August 2023	Align FARM and PCNR Board member appointments to 2 or more	Company Secretary
2.0	7 August 2025 - pending	Major review with technology and property added to scope; term renewal increased to three years; co-opted members increased to up to four in total, with one to have experience in AGPT agreement/GP training	Company Secretary
Policy Type:	Board Governance
Policy owner:	Board
Approved by:	Board		Approved on:	7/08/2025
Next Review Due:	August 2026

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