The scope of authority and regulatory responsibilities of the Supervisory Committee are established in the Federal Credit Union Act, the Rules and Regulations of the National Credit Union Administration, and the bylaws of the credit union.
The Supervisory Committee is responsible for ensuring that the Board and management establish practices and procedures to properly safeguard members' assets. In addition, the Committee is responsible for the annual financial statement audit from a licensed, independent auditor.
In accordance with the Federal Credit Union Act, the Supervisory Committee is comprised of volunteers appointed by the Board of Directors from among the members of the credit union, and functions completely independent of credit union management. The Supervisory Committee also serves as an alternative channel of contact from the Board of Directors for members and regulators with material safety and soundness concerns. The Committee is responsible for investigating complaints not resolved to their satisfaction by management.
Key Responsibilities Include:
- Appoint and oversee the work of a Certified Public Accounting firm for the purpose of completing an annual financial statement opinion audit of the credit union's books and records.
- Review the findings of any examinations by regulatory agencies, any auditor observations, or other reports produced by outside consultants related to the purpose of the Supervisory Committee.
- Ensure that adequate operational controls are in place and functioning.
- Understand the scope of internal and external auditors' review of internal controls over financial reporting and obtain reports on significant findings and recommendations, together with management's responses.
- Review the organizational structure of the internal audit function, including the audit policy, plans, activities, and staffing.
- Ensure proper reporting and filing of the quarterly Financial and Statistical Report, NCUA Form 5300.
- Regularly report to the Board of Directors about committee activities, issues, and related recommendations, and provide an open avenue of communication between internal audit, the external auditors, and the Board of Directors.
- Report annually to the members at the Annual Meeting, describing the committee's composition, responsibilities and how they were discharged, and any other information required by regulation.