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Reporting & Assurance Standards Oversight Council

Terms of Reference

Role of the Council

  1. The role of the Reporting and Assurance Standards Oversight Council (“the Oversight Council”) is to serve the public interest by overseeing and providing input to the activities of the Auditing and Assurance Standards Board (AASB), the Accounting Standards Board (AcSB), the Canadian Sustainability Standards Board (CSSB) and the Public Sector Accounting Board (PSAB) (collectively, “the boards”).
  2. The central purpose of standard-setting oversight is to be satisfied that standards are being developed in the public interest following due process.

Responsibilities

  1. The Oversight Council oversees the AASB, AcSB, CSSB, and PSAB activities in a variety of ways, including the following:

a) Effective processes at the boards:

i. Approve the Terms of Reference;

ii. Approve the Due Process Manuals;

iii. Monitor due process applied by the boards in the development of standards to be satisfied that standards are developed in the public interest; and

iv. Monitor effective board processes through risk-based meeting observation, and annual board performance evaluations.

b) Board Strategic and Annual Plans:

i. Provide advice on the strategic planning process;

ii. Provide advice on the annual planning process;

iii. Monitor the boards’ performance against the Strategic and Annual Plans; and

iv. Be satisfied that the boards consider all categories of interested and affected parties in determining their priorities and strategies.

c) Board Appointments:

Appoint members of the AASB, AcSB, CSSB, and PSAB, including Chairs and, where applicable, Vice Chairs.

d) Oversight Council appointments:

Appoint members of the Oversight Council, including the Chair, Committee Chairs, and, where applicable, a Vice Chair.

e) Reporting:

Report annually to the public on the Oversight Council’s discharge of its responsibilities, including information on the boards' activities and Council oversight.

f) Resourcing:

Determine whether the boards have the resources necessary to support their work and advise Reporting and Assurance Standards Canada (RAS Canada) on resource needs of the boards and the Oversight Council when appropriate.

g) Monitoring:

I. Monitor developments within Canada that may significantly affect existing and future Canadian standards; and

II. Monitor developments internationally that may significantly affect existing and future Canadian standards.

Committees of the Oversight Council

  1. The Oversight Council has established the following permanent standing committees to assist it in fulfilling its mandate and responsibilities:
  • the Nominating Committee
  • the Governance Committee
  1. Each standing committee operates in accordance with the Council-approved Terms of Reference and reports to the Oversight Council as required. Committees do not have decision-making power but may propose recommendations for the Oversight Council’s consideration.
  2. The Oversight Council may also establish other standing, special, or ad hoc committees or working groups from time to time, as it considers necessary or advisable, to support the effective and efficient discharge of its responsibilities. The mandate, composition, and duration of any such committee shall be determined by the Oversight Council.
  3. The Oversight Council appoints each committee's Chair.
  4. Committee meetings are not open to the public.

Composition and Membership

  1. The Oversight Council will be composed as follows:

15-17 members, including one representative from each of the following regulatory bodies:

I. The Canadian Securities Administrators (CSA);

II. The Canadian Public Accountability Board (CPAB);

III. The Office of the Superintendent of Financial Institutions (OSFI); and

IV. The CPA Provincial, Territorial, and Bermudian Bodies (PTBs).

Regulators are ineligible to serve as the Oversight Council Chair, Vice Chair, or any Committee Chair.

  1. Members of the Oversight Council are selected based on individual merit using criteria outlined in a skills matrix.
  2. Consideration is given to balancing the number of members with Chartered Professional Accountant (CPA) designations with the need to ensure independence from the CPA profession and the value of perspectives of those with a broader business perspective. Oversight Council members must have adequate knowledge of reporting and the standard-setting system.

Term of Office

  1. Members of the Oversight Council will generally be appointed for a term of three (3) years, renewable once for a further term not exceeding three (3) years. Oversight Council members will generally not serve consecutively for more than six (6) years. However, the Nominating Committee is responsible for the succession planning for the Oversight Council and has discretion to recommend term extensions where appropriate.

Vacancies and Removal

  1. If a vacancy occurs among the appointed Oversight Council members that puts composition below the range outlined in clause 9, the Oversight Council will appoint a person to fill the vacancy.
  2. The office of an Oversight Council member will automatically be vacated if:

a. the member dies;

b. the member resigns; or

c. the member is unable to fulfil the duties of an Oversight Council member.

  1. Any Oversight Council member absent from three (3) consecutive meetings or more than 50% of the Oversight Council's regular meetings during any twelve (12)-month period may be removed from the Oversight Council by special resolution (2/3 vote) of the Oversight Council.
  2. The Chair and Vice Chair may be removed from their respective offices by special resolution (2/3 vote) of the Oversight Council if they are absent without advance notice to the Chair of the Governance Committee for two (2) consecutive meetings of the Oversight Council.
  3. Allegations that an Oversight Council member has breached the Code of Conduct, confidentiality obligations, or any other conditions of appointment shall be addressed in a manner that is fair, impartial and proportionate, and that upholds the integrity of the Oversight Council and public confidence in its work. These matters will be referred to the Governance Committee for review.
  4. The Oversight Council will ensure that allegations of misconduct are reviewed and assessed through an appropriate process led by the Governance Committee, including considerations of relevant facts and circumstances, before determining whether any action is warranted.
  5. Where an allegation relates to the Chair, the Vice Chair, or another Oversight Council member acting in an officer or leadership capacity, the Governance Committee will recommend to the Oversight Council appropriate interim arrangements while the allegations are being considered. This will ensure continuity of leadership and the orderly functioning of the Oversight Council, consistent with these Terms of Reference and applicable governance principles.

Officers

  1. The Oversight Council will have the following Officers:

a) a Chair;

b) a Vice Chair; and

c) such other Officers as the members of the Oversight Council may determine by resolution.

  1. The Oversight Council Chair, Vice Chair and Nominating Committee and Governance Committee Chairs will serve as Members of RAS Canada. The Members will fulfill their duties as outlined in the bylaws of RAS Canada.

Role and Responsibilities of the Chair

  1. The Chair will:

a) determine the Oversight Council agenda (supported by staff);

b) preside and preserve order at meetings of the Oversight Council;

c) call for motions and declare decisions of the Oversight Council;

d) interpret resolutions of the Oversight Council and the intent of the Terms of Reference;

e) may, by virtue of office, attend all committees of the Oversight Council;

f) have the same voting rights as any member of the Oversight Council;

g) resolve issues with individual members and provide feedback;

h) participate in Board Chair performance reviews;

i) direct the Oversight Council evaluations;

j) act generally as the spokesperson for the Oversight Council; and

k) have other responsibilities and duties that may be assigned by the Oversight Council or as are incidental to the office of the Chair.

Roles and Responsibilities of the Vice Chair

  1. The Vice Chair will have responsibilities and perform duties as designated by the Chair of the Oversight Council or as determined collectively by the Oversight Council members.
  2. In the absence of or inability to act as the Chair, the Vice Chair will have full authority to act as the Chair.

Election of Officers and Terms

  1. The Nominating Committee will recommend the appointment of the Oversight Council Chair and Vice Chair. Before making its recommendation for the Oversight Council Chair and Vice Chair, the Nominating Committee consults with Oversight Council members on a confidential basis. After the Nominating Committee recommendation, the Oversight Council will elect a Chair and Vice Chair from among the appointed Oversight Council members, each for a three-year term or such term as recommended by the Nominating Committee. The Vice Chair does not accede to the Chair position.

Meetings

  1. Meetings of the Oversight Council are held as frequently as necessary to discharge its responsibilities, normally at least three times a year.
  2. The Oversight Council and its committees may hold meetings in person or by telephone, videoconference or other similar means. Members unable to attend a meeting in person have the right to participate by telephone or videoconference, subject to any rules established by the Oversight Council.
  3. The Oversight Council meetings are open to public observation, other than in camera discussions and other confidential matters.

Quorum

  1. 29. A quorum at any meeting of the Oversight Council is a majority of the members of the Oversight Council.

A quorum at any meeting of a committee of the Oversight Council is a majority of the members of the committee.

Voting

  1. Each member of the Oversight Council, including the Chair, has one vote. The Chair has an additional vote if required to break a tie.

a) The affirmative vote of a simple majority of all the Oversight Council members voting on a particular matter is required for all Oversight Council decisions except in case of requiring a special resolution to remove members as described in these Terms of Reference.

b) The affirmative vote of a simple majority of all committee members of the Oversight Council voting on a specific matter is required for all committee decisions.

c) All votes taken at the Oversight Council meetings, and the committees of the Oversight Council are documented in the respective minutes of each group. The minutes constitute proper evidence of the decisions of the Oversight Council and its committees.

Remuneration of Council Members

  1. Council and committee members are volunteers and, therefore, are unpaid. Out-of-pocket expenses, including travel costs, will be reimbursed. The Chair may receive compensation at the discretion of RAS Canada.

Conflict of Interest

  1. At the beginning of each Oversight Council or committee meeting, the Chair, or in the absence of the Chair, the Vice Chair, will ask and have recorded in the minutes whether any Oversight Council member has a conflict of interest to declare with respect to any agenda items.
  2. Every member of the Oversight Council or committee who has a conflict of interest in any matter under consideration by the Oversight Council is required to declare the nature of the conflict to the Chair or Vice Chair of the Oversight Council or committee as soon as the member is aware of the conflict and, where possible, before discussion of such matter at any meeting of the Oversight Council or committee. A member declaring a conflict should refrain from discussing and voting on the matter. If there is a difference of opinion among the Oversight Council or committee members whether the member has a conflict, it will be left to the Chair’s discretion to make a final decision on the matter.
  3. The conflict of interest will be recorded in the minutes of the Oversight Council or committee meeting.

Code of Conduct

  1. All members of the Oversight Council must adhere to a Code of Conduct signed annually.

Confidentiality

  1. Members of the Oversight Council must keep meeting materials and information confidential unless the Chair of the Oversight Council decides to release a particular document or information to the public.

Review

  1. The Terms of Reference for the Oversight Council will be reviewed by the Oversight Council every five years or more frequently as necessary.