The Audit Committee currently comprises Nigel Moore, Dipesh Shah and Michel-Marc Delcommune. The Committee is chaired by Mr Moore, who as a former audit partner with Ernst & Young LLP possesses recent and relevant financial experience, also chairs the Audit Committee of four other UK listed companies, and maintains a regular pattern of attendance at relevant seminars and courses.
The Audit Committee, which has Terms of Reference agreed by the Board and available to shareholders on request, meets at least three times a year. It reviews the Company’s accounting policies; monitors the integrity of the financial statements of the Company and any announcements relating to the Company’s financial performance, reviewing significant financial reporting judgments contained in them; reviews the Company’s internal financial controls; reviews internal control and risk management systems and compliance procedures; reports to the Board any matters which it considers actions or improvement are needed with associated recommendations as to steps to be taken; and makes recommendations to the Board, for it to put to shareholders for their approval in general meeting, in relation to the appointment, re-appointment and removal of the external auditor and to approve the remuneration and terms of engagement of the external auditor. During 2008 the Committee met four times with each Committee member attending all meetings held whilst they sat on the Committee. Meetings are attended, by invitation, by the Chief Executive Officer and the Finance Director.
The Audit Committee reviews each of the Company’s subsidiaries, interests and activities at least once a year; site visits are also undertaken by the Committee members to significant operations on a frequent basis.
The Audit Committee maintains an objective and professional relationship with the Company’s auditors and meets in private session with them on a periodic basis. From time to time, the auditor is requested to perform non-audit engagements for the Group. In such instances the continued objectivity and independence of the auditors in their capacity of auditor is an objective of the Group. To meet this objective the Audit Committee is delegated the role of vetting the appointment of the auditor on specific engagements including considerations of materiality and, where necessary, requiring a competitive tender for such work.
The Company promotes a culture of openness and encourages staff to raise any concerns of possible improprieties in matters of financial reporting or other matters, if necessary in confidence. The Audit Committee has reviewed arrangements for such concerns to be raised, investigated and if necessary followed up.
The Audit Committee has reviewed the Revised Combined Code, specifically Section C that addresses audit committee aspects, and considers that it complies with all the provisions identified apart from the provision concerning the need to have a dedicated internal audit function which is not established for the reasons listed below. Areas of non-compliance in addition to Section C are listed above.
