FAIRFAX MEDIA  LIMITED  2013  49 CORPORATE GOVERNANCE AUDIT AND RISK COMMITTEE CHARTER OF AUDIT INDEPENDENCE The Audit and Risk Committee operates in accordance with a Charter which sets out its role and functions. In summary, the  Committee’s role is to advise and assist the Board on the establishment and maintenance of a framework of risk management,  internal controls and ethical standards for the management of the Fairfax Group and to monitor the quality and reliability of  financial information for the Group. To carry out this role, the Committee: Under its Charter, all members of the Committee must be Non-Executive Directors. Executives may attend by invitation. The  Chair of the Committee is required to be independent and have relevant financial expertise and may not be the Chair of the  Board. The members of the Audit and Risk Committee and details of their attendance at Committee meetings are set out  on page 26. The Chair of the Committee may, at the Company’s expense, obtain external advice, or obtain assistance and  information from officers of the Group, or engage other support as reasonably required from time to time. The Board has also adopted a Charter of Audit Independence. The purpose of this Charter is to provide a framework for the  Board and management to ensure that the external auditor is both independent and seen to be independent. The purpose of  an independent statutory audit is to provide shareholders with reliable and clear financial reports on which to base investment  decisions. The Charter sets out key commitments by the Board and procedures to be followed by the Audit and Risk Committee  and management aimed to set a proper framework of audit independence. To promote audit quality and effective audit service by suitably qualified professionals, the Board ensures that the auditor is  fairly rewarded for the agreed scope of the statutory audit and audit-related services. The auditor is required to have regular  communications with the Committee, at times without management present. Audit personnel must be appropriately trained,  meet the required technical standards and maintain confidentiality. Restrictions are placed on non-audit work performed by the auditor. Non-audit fees above a fixed level may not be incurred  without the approval of the Chair of the Audit and Risk Committee. The Company requires the rotation of the lead audit partner and the independent review partner for the Company at least  every five years. The Committee requires the auditor to confirm annually that it has complied with all professional regulations  and guidelines issued by the Australian accounting profession relating to auditor independence. The auditor must also  confirm that neither it nor its partners has any financial or material business interests in the Company outside of the supply of  professional services. • recommends to the Board the appointment of the external auditor, reviews its performance, independence and effectiveness,  approves the auditor’s fee arrangements and enforces the Company’s Charter of Audit Independence • ensures that appropriate systems of control are in place to effectively safeguard assets • ensures accounting records are maintained in accordance with statutory and accounting requirements • monitors systems designed to ensure financial statements and other information provided to shareholders is timely,  reliable and accurate • formulates policy for Board approval and oversees key finance and treasury functions • formulates and oversees an effective business risk plan • ensures appropriate policies and procedures are in place for compliance with all legal, regulatory and ASX requirements • monitors compliance with regulatory and ethical requirements • reviews the external audit process with the external auditor, including in the absence of management • reviews the performance of internal audit • reviews and approves the internal audit plan and receives summaries of significant reports by internal audit • meets with the Internal Audit Manager including in the absence of management if considered necessary, and  • does anything else it considers necessary to carry out the above functions.