Finance Committee (FC) - Specific terms of reference

Purpose

The Finance Committee (FC) is a standing committee whose principal role is to advise the Board and to support the Chief Executive/Accounting Officer on Finance, budget management and planning.

Scope

The FC remit combines the previous responsibilities of the Finance Planning & Performance Committee (FPPC) with the responsibilities of two previous Task & Finish Groups (The Board Task & Finish Group: Finance, Governance and Delivery and the Board Oversight Timber Sales Governance Group).

The FC will provide advice, oversight and scrutiny on strategy, management and performance in relation to finance, business planning and performance, charge schemes, commercial matters (including timber sales and marketing activity), compliance and the Programme Management Office. In carrying out its role the FC will focus on strategic direction and development, and in scrutinising performance and delivery.

The FC will need to ensure that in carrying out its role it does not duplicate that of the Audit and Risk Assurance Committee (ARAC). The role of ARAC is to advise the Board on risk, financial stewardship and accountability, control and governance. ARAC will also continue to scrutinise improvements made in response to reviews undertaken by Internal Audit.

The FC and ARAC have complementary roles. FC will be forward looking, making decisions within their remit and providing advice to the Board on financial and performance matters as required. ARAC will scrutinise and provide assurance as required. FC will lead in reviewing progress on commercial activities, sales, and marketing (including of timber), with ARAC providing the overview.  ARAC will lead in reviewing progress against compliance and the three lines of defence work, with FC providing the overview.

Responsibilities

The responsibilities of the FC are to:

• provide advice and support in the development of NRW annual business plans, corporate plans (4-5 years), and long-term vision (to 2050);
• provide advice and support to ensure the development of appropriate finance strategies, management reporting, and plans;
• scrutinise the annual Budget prior to submission to the full Board for approval, challenging the underlying assumptions and advising the Board on its adoption;
• provide oversight and scrutiny of the financial performance of NRW through the monthly and quarterly management financial statements to ensure appropriate and effective use of funds;
• monitor the financial position and future prospects/sustainability of the organisation to ensure that it can continue to meet its commitments and strategic objectives;
• champion the importance of Value for Money, ensure appropriate controls are in place and monitor performance;
• review and scrutinise the Performance Report included in the Annual Report and Accounts;
• provide oversight and scrutiny of the business performance of NRW;
• provide advice and support to the Strategic Charging Programme in relation to changes in current charge schemes and in the development of new schemes;
• provide advice and support in the development of commercial strategies and plans;
• provide oversight and scrutiny of the delivery of commercial plans and performance;
• provide oversight and advice in relation to the funding of the NRW membership of the Local Government Pension Scheme;
• provide scrutiny and challenge of key risks and issues for timber sales and marketing and the embedding of governance and process improvements in these spheres;
• ensure that NRW’s response to the Grant Thornton independent review in respect of timber and subsequent Internal Audit report are embedded;
• oversee delivery via the Timber Sales and Marketing Transition Tracker, including scrutinising variations to the actions, milestones, etc;
• ensure oversight of the wider NRW consequences, including compliance culture and staff impact;
• provide oversight and scrutiny of the delivery of the compliance work based around the three lines of defence model;
• provide oversight and scrutiny of the delivery of the newly established Programme Management Office, Contract Management Office, and procurement.

Meetings

The FC will meet at least four times per annum.

The focus of each meeting, whether finance, business planning and performance, charging, commercial or a combination, will vary depending on which matters require scrutiny or advice. 

Terms of Reference agreed: September 2021