Audit Committee Resolution Template for England and Wales

An Audit Committee Resolution is a formal corporate document that records decisions and actions taken by your company's audit committee. Under United States law, these resolutions serve as essential governance tools that demonstrate compliance with federal securities regulations, particularly the Sarbanes-Oxley Act and SEC requirements. The document provides legal documentation of your committee's deliberations and ensures proper corporate governance standards are met.

When do you need this document?

You need an Audit Committee Resolution whenever your audit committee makes significant decisions requiring formal documentation. This includes approving annual financial statements before public filing, selecting or dismissing external auditors, establishing internal control procedures, or addressing material weaknesses in financial reporting. Public companies listed on major exchanges must use these resolutions to comply with NYSE and NASDAQ governance requirements. You'll also need resolutions when implementing compliance programs, approving audit fees, or addressing whistleblower complaints under SOX provisions.

Key legal considerations

Your resolution must demonstrate committee independence as required by Section 301 of the Sarbanes-Oxley Act, ensuring no members have financial relationships that could compromise objectivity. The document should reference your audit committee charter and confirm that at least one member qualifies as a financial expert under Section 407. Include specific recitals citing applicable regulations such as Rule 10A-3 of the Securities Exchange Act and relevant stock exchange listing standards. Your resolution must clearly articulate the committee's authority to engage independent advisors and establish procedures for handling complaints. Documentation of proper notice, quorum requirements, and voting procedures protects against future legal challenges to committee decisions.

Legal requirements in United States

Under federal law, your Audit Committee Resolution must comply with multiple regulatory frameworks governing public company audit committees. The Sarbanes-Oxley Act requires specific committee compositions, with all members being independent directors and at least one financial expert. Your resolution must demonstrate compliance with SEC disclosure requirements under Regulation S-K, particularly regarding committee member qualifications and financial expertise. Stock exchange rules impose additional obligations: NYSE-listed companies must follow Section 303A requirements, while NASDAQ-listed companies must comply with Rule 5600 standards. Your document should reference internal governance documents including corporate bylaws and the audit committee charter. The resolution must provide adequate detail for SEC reporting requirements and potential regulatory examination, ensuring clear documentation of decision-making processes and compliance measures.