Michael Ahern (Cork East, Fianna Fail)

The independence of the audit committee is the fundamental principle we are trying to achieve through this provision. However, I have asked my officials to reconsider the exclusion term of five years. Perhaps it is a bit excessive.

The new section 205B, inserted into the 1990 Act by section 40 of the Bill, states that:

The requirement that all members of the audit committee qualify under subsection (6) does not apply if all of the following conditions are met:

(a) the number of qualified directors on the board of directors of the company or relevant undertaking concerned is otherwise insufficient to enable that company or undertaking to fulfil its duty to establish an audit committee;

(b) any conditions prescribed under section 46(1)(m) of the Act of 2003;

(c) the directors of the company or undertaking concerned state in their report under section 158 of the Principal Act the reasons for not complying with the requirement.

There is, therefore, provision made, outside the normal conditions set out, for individuals to be appointed to audit committees.