The objective of the Committee is to assist the Board of Directors to discharge its corporate governance responsibilities to exercise due care, diligence and skill in relation to the Company's:

reporting of financial information to users of financial reports
application of accounting policies
maintenance of the independence of the company’s auditors
financial management
internal control system
risk management & analysis
business policies and practices
compliance with the Company's constitutional documentation and material contracts
compliance with the applicable guidelines and regulations with respect to clinical trials
compliance with statutory occupational health and safety laws and regulations
compliance with applicable laws and regulations and
monitoring and controlling of business and other risk.

Accordingly, its role will be to:

serve as an independent and objective party to review the financial information presented by management to the Board and the general public
serve as an independent and objective party to review the efficiency and effectiveness of the information presented by management to the Board concerning risk management, quality assurance, clinical trials and occupational health & safety
oversee and appraise the quality of audits conducted by the Company’s external auditors;
advise the Board of possible conflict of interest and/or loss of independence by the Company’s auditors in respect of work proposed to be undertaken by the auditors
maintain, by scheduling regular meetings, open lines of communication among the Board and the external auditors to exchange views and information, as well as confirm their respective authority and responsibilities and
determine the efficiency and effectiveness of administrative operating and accounting controls used by the company.

Membership

The Committee will be appointed by the Board and shall consist of at least two members. In this regard:

all members will be non-executive Directors of the Board
the Board shall appoint the Chairman of the Committee
the quorum for meetings of the Committee shall be two members
the Managing Director and Chief Financial Officer will attend by invitation and
the Company Secretary will act as Secretary to the Committee.

Duties and Responsibilities

The Committee shall consider any matters relating to the financial affairs of the Company and to the external audit that it determines to be desirable. In addition, the Committee shall examine any other matters referred to it by the Board.

The main duties and responsibilities of the Committee are as follows:

1. Review of financial information

Review the draft annual financial statements (and any half yearly or more frequent financial reports) of the Company prior to approval by the Board, focusing in particular on:

significant changes in accounting policies and practices
major judgmental areas
significant audit adjustments
proposed departures from accounting standards.

2. Statutory/Compliance

Ensure compliance with statutory requirements for financial reporting.
Consider the effects on the Company of any new or proposed accounting practices, principles, developments, disclosure requirements and legislative or regulatory pronouncements.

3. Evaluation of Policies and Controls

Evaluate the adequacy and integrity of the accounting control system by reviewing written reports from the external auditors and monitoring Management's responses and actions to correct any noted deficiencies.
Evaluate the adequacy and effectiveness of the Company’s administrative, operating and accounting policies through active communication with operating management and the external auditors.

4. Liaison with external auditors

Recommend to the Board the appointment of external auditors and the payment of annual fees.
Review the audit plans of the external auditors.
Evaluate the overall effectiveness of the external auditors through regular meetings with them.
Ensure that no management restrictions are being placed on the external auditors.

5. Independence of external auditors

The Company must comply with the requirements of the Corporations Act 2001 in respect of the independence of its external auditors, who are appointed as the result of a competitive tender process.

The Company expects that the requirements of Professional Statement F.1 Professional Independence issued by the Institute of Chartered Accounts and CPA Australia will be complied with to maintain the independence of its external audit function. Both the Company and the external auditors are required to ensure compliance with F.1 and to adopt a formal process for the rotation of the audit engagement partner.

The Company must not engage its external auditors for any project that would put the firm in the position of auditing its own work or that would otherwise be inappropriate for a firm expected to exercise fully objective and impartial judgment.

It follows then that the following types of services by the Company's external auditors are prohibited:

Bookkeeping and related services
Appraisal or valuation services that involves the valuation of matters material to the financial reports and the valuation involves a significant degree of subjectivity
Management services of a decision-making, supervisory or prolonged (ongoing) monitoring nature
Broker-dealer services and
Legal services that are dealing with issues that could have a material impact on the financial statements.

The Company's external auditors are not prohibited from evaluating and making recommendations about control in its audit role.

Any proposal to engage the Company's external auditors for non-audit services requires pre-approval by the Committee where the fees are expected to exceed $10,000. A full analysis of the total fees paid to external auditors, including a breakdown of fees for non-audit activities will be provided in the Annual Report.

6. Compliance with legal and regulatory obligations

Review all regular reports provided to the Committee by executive management covering areas of:

Corporate Governance
Quality Management Systems
Regulatory Affairs
Occupational Health & Safety.

7. Other

Review the Company's Risk Management activities and analysis with particular emphasis on Intellectual Property and IT systems;
Review the Company's Treasury Management activities.
Establish and periodically review a code of conduct and monitor the ethical behaviour of the Company and management to ensure compliance.
Review external audits carried out on behalf of domestic and international regulatory authorities in respect of marketing the Company's products.
Review the placement of the Company's insurance program and its alignment with the Company's risk profile.
Identify any special projects or investigations deemed necessary.

8. No Executive Power

The Committee shall have no executive power with regard to its findings and recommendations.

Reporting Requirements

The Chair of the Audit, Risk & Compliance Committee will report to the Board on a half yearly basis. The report should cover the findings and recommendations of the Committee. The minutes of all Committee meetings shall be circulated to members of the Board.

Timing and Frequency of Meetings

The Committee will hold at least two (2) meetings per annum, or more as required, to fulfil its responsibilities. The Committee will also meet at the request of the Board, any other Director not a member of the Committee, the Managing Director, the Company Secretary or the Company’s external auditor.

Authority and Access to Personnel and Information

The Committee shall have unlimited access to both internal and external auditors and advisors and to senior management of the Company. The Committee shall also have the ability to consult independent experts where required to fulfil its responsibilities.