STATEMENT OF CORPORATE GOVERNANCE CONTINUED Recommendation 4.2 of the revised Corporate Governance Council Principles recommends that the Audit Committee be structured  so that it: The recommendation is to ensure that the Audit Committee is of sufficient size, independence and technical expertise to  discharge its mandate effectively. The Company has fully complied with Recommendation 4.2. The Audit Committee met four  times during the financial year. The responsibilities of the Audit Committee include: The Audit Committee reports to the Board of Directors after each Committee Meeting and minutes of meetings are provided to all Directors. The role of the Nomination Committee is to provide for a formal and transparent process for the selection, appointment and re-appointment of Directors. The Company has formally adopted a Nomination Committee Charter. A copy of the Nomination  Committee Charter can be found on the Company’s website at www.karoongas.com.au. The Nomination Committee consists of: Mr Clark Davey (Chairman) Mr Geoff Atkins Mr Robert Hosking Recommendation 2.4 of the revised Corporate Governance Council Principles recommends that the Nomination Committee be structured so that it: The Company fully complies with Recommendation 2.4. However, the Nomination Committee was established after the end of  the financial year. Prior to the Nomination Committee being formally established, the Board of Directors considered that the same  efficiencies that may be derived from a Nomination Committee with respect to a larger Board may not, in the current circumstances,  be derived from a formal Nomination Committee structure. However, the Board of Directors had processes in place which  addressed the issues that would otherwise be considered by a Nomination Committee. • consists of a majority of Independent Directors; • is chaired by an Independent Chairman, who is not Chairman of the Board of Directors; and • has at least three members. Nomination Committee • reviewing the integrity of the Company’s financial reporting and overseeing the independence of external auditors; • liaising with external auditors and ensuring that the annual statutory audits and half year auditor reviews are conducted in an  effective manner; • reviewing internal controls and recommending improvements; • reviewing the half year financial report prior to lodgement of this document with the ASX, and any significant adjustments  required as a result of the review; • reviewing the draft annual financial report and the independent auditor’s report and making the necessary recommendations  to the Board of Directors for approval of the annual financial report; • reviewing treasury recommendations and making necessary recommendations to the Board of Directors for approval; and • reviewing and reporting on any special reviews deemed necessary by the Board of Directors. • consists only of Non-Executive Directors; • consists of a majority of Independent Directors; • is chaired by an Independent Chairman, who is not Chairman of the Board of Directors; and • has at least three members. 86 Karoon Gas Australia Ltd  Annual Report 2011