Report of the Directors
Governance

Audit Committee Report

«Previous 1 / 2

Independence of External Auditor

Both the board and the external auditor have for many years had safeguards in place to avoid the possibility that the auditor’s objectivity and independence could be compromised. The issue of auditor independence is taken very seriously and is reviewed annually. This year some changes have been made to the senior audit team. A second partner has been introduced partly to provide greater senior level coverage but also to provide some continuity when the signing partner rotates in 2013.

Our policy in respect of services provided by the external auditor is as follows:

To the extent consistent with the above policy, services likely to cost less than £25,000 may be approved by the Group Finance Director. Services above this amount must be approved by the Chairman of the Audit Committee, unless they are likely to be in excess of £100,000, when they must be approved by the Audit Committee.

The split between audit and non-audit fees for the year ended 31st March 2012 and information on the nature of non-audit fees appear in note 5 on the accounts.

Internal Audit

Internal audit independently reviews the risks and control processes operated by management. It carries out independent audits in accordance with an internal audit plan which is agreed with the Audit Committee before the start of the financial year. As part of this process the Committee looks at the resources devoted to the function to ensure they are adequate to deliver the plan.

The plan provides a high degree of financial and geographical coverage and devotes significant effort to the review of the risk management framework surrounding the major business risks.

Internal audit reports include recommendations to improve internal controls together with agreed management action plans to resolve the issues raised. Internal audit follows up the implementation of recommendations and reports progress to senior management and the Audit Committee.

The Audit Committee reviews the findings of the internal audits completed during the year.

The effectiveness of the internal audit function is reviewed and discussed on an annual basis.

On behalf of the Audit Committee:

Alan Ferguson
Chairman of the Audit Committee

Back to top