Dewan INC. has several divisions, each with a manager responsible for the operations of the division. Each division of Dewan controls product design, sales, pricing, operating costs, and profits.. However, Dewan's corporate management maintains control over the financial operations of the divisions by approving all capital expenditures above a small amount and by keeping tight reins on the financial reporting from the division to corporate headquarters. Each division has a corporate controller who manages the division's accounting system and provides analysis of financial information for the division management. The division controllers report to their division manager and to the corporate controller of Dewan Inc. The division manager evaluates the performance of the division controller and recommends salary increases and promotions to the corporate controller, who makes the final decision. The division manager and the division controller write separate and independent reports to Dewan's corporate headquarters discussing the financial results of the division. Dewan's corporate management insists that the division controller provides an independent view of the division's operations. Identify and discuss the

   

(a) "Audit committees do not prepare financial reports, nor do they conduct audits. But they have an essential role to play in ensuring the integrity and transparency of corporate reporting" - explain what is the role of an audit committee in ensuring the integrity and transparency of corporate reporting? Is an audit committee mandatory in Australia? (9)