35 Corporate Governance Statement Corporate Governance Statement Performance Review of the  Board and Senior Executives Independent Professional Advice Board Committees Appointment of Directors Auditor Independence and Engagement Audit Committee The concept of ‘materiality’ is considered from  both the Company and the individual Director  perspective. The determination of materiality  requires consideration of both quantitative and  qualitative elements. An item is presumed to be  quantitatively immaterial if it is equal or less  than 5% of the appropriate base amount. It is  presumed to be material (unless there is qualita- tive evidence to the contrary) if it is equal to or  greater than 10% of the appropriate base  amount. Qualitative factors considered include  whether a relationship is strategically impor- tant, the competitive landscape, the nature of  the relationship and the contractual or other  arrangements governing it and other factors. Nominations of new Directors, recommended by  the Nomination Committee, are considered by  the full Board. The Nomination Committee employs external  consultants to access a wide base of potential  Directors, considering their range of skills and  experience required in light of the: The Board assesses nominated Directors against  a range of criteria including experience, profes- sional expertise, personal qualities, potential  conflicts of interest and their capacity to  commit themselves to the Board’s activities. The Committee has appropriate financial exper- tise. All members of the Committee are financially  literate and have an appropriate understanding of  the industry in which the Company operates. The Audit Committee’s role is to assist the Board  to fulfil its responsibilities associated with the  Company’s accounts, its external financial  reporting, its internal control structure, risk  An analysis of fees paid to the external auditors,  including a breakdown of fees for non-audit  services, is provided in the Directors’ Report. It is  the policy of the external auditors to provide an  annual declaration of their independence to the  Audit Committee. The performance of the external auditor is  reviewed annually and applications for tender of  external audit services are requested when  deemed appropriate, taking into consideration  assessment of performance, existing value and  tender costs. The charter adopted by the Audit Committee  confirms its role in assisting the Board in respect  of the appointment, compensation, retention  and oversight of the Company’s external audi- tors. The external auditors are required to  confirm that they have maintained their inde- pendence in accordance with the  Corporations  Act 2001 (Cth) and the rules of professional  accounting bodies. To assist the Board in fulfilling its responsibili- ties, the Board has established three commit- tees to consider certain issues and functions.  These committees are as follows: Each committee operates under its own charter. Directors are able to access members of the  management team at any time to request rele- vant information. It is also Board policy that Directors may seek  independent advice at the Company’s expense. The Managing Director undertakes an annual  review of the performance of each Senior  Executive against individual tasks and  objectives. Performance evaluations of the Board, its  committees, the individual Directors and key  executives were undertaken in the 2013 finan- cial year in accordance with the above  processes. Each year the Board receives reports from  management detailing interactions with and  outlining the expressed views of the Company’s  shareholders. The Nomination Committee is  responsible for evaluation of the Board, its  committees and its key executives. management systems and audit function. The  primary functions of the Audit Committee are to: In fulfilling its responsibilities, the Audit  Committee has rights of access to management  and to auditors (external and internal) without  management present and may seek explanations  and additional information. The Audit Committee met twice during the 2013  financial year. The Audit Committee operates in accordance  with a charter published in the ‘Corporate  Governance’ section of the Company’s website. 〉 Mr Craig Carracher (Chairman of Audit  Committee); 〉 Mr Ross Smyth-Kirk; and 〉 Mr Peter McAleer.  〉 current composition of the Board; 〉 need for independence; 〉 the Company’s Diversity Policy; 〉 strategic direction and progress of the  Company; and 〉 nature of the Company’s business. 〉 Audit Committee; 〉 Remuneration Committee; and 〉 Nomination Committee. The members of the Audit Committee as at the  date of this Report are: 〉 is employed, or has previously been  employed in an executive capacity by the  Company, and there has not been a period of  at least three years between ceasing such  employment and serving on the Board; 〉 has within the last three years been a prin- cipal of a material professional adviser or a  material consultant to the Company, or an  employee materially associated with the  above mentioned adviser / consultant; 〉 is a material supplier or customer of the  Company, or an officer of or otherwise  associated directly or indirectly with a material supplier or customer; and 〉 has a material contractual relationship with  the Company other than as a Director. 〉 review the financial information provided by  the Board to shareholders and other parties  ensuring that it is true and fair and complies  with relevant accounting standards; 〉 ensure that corporate risk management  policies and internal controls are in place and  are maintained in accordance with appro- priate standards and statutory  requirements; 〉 oversee and evaluate the quality of the  audits conducted by the external auditors; 〉 provide for open communication between  the external auditors and the Board for the  exchange of views and information; and 〉 recommend to the Board the nomination and  remuneration of the external auditors and  ensure their independence and integrity. continued