Audit Committee
The Audit Committee comprises Messrs Davis, Stein and Murray, who chairs the committee.
The committee’s membership is reviewed by the Nominations Committee and by Mr Murray (pictured) at regular intervals. Members of the committee are appointed by the Board following recommendations by the Nominations Committee. The committee is normally comprised of three independent Non Executive Directors. Two members constitute a quorum.
The committee is required to assist the Board to fulfil its responsibilities related to external financial reporting and associated announcements.
Each member of the committee brings relevant financial experience at a senior executive level and the expertise and experience of the members of the committee are summarised in Our Board. The Board considers that each member of the committee is independent within the definition set out in the Code. Mr Stein is considered by the Board to have significant, recent and relevant financial experience, having been, until September 2007, Finance Director of GKN plc.
All members of the committee receive appropriate induction, which is in addition to the induction which all new Directors receive and includes an overview of the business, its financial dynamics and risks. Members of the committee undertake ongoing training as required. Audit Committee members are expected to have an understanding of the following areas:
The committee is required to assist the Board to fulfil its responsibilities related to external financial reporting and associated announcements.
The committee is also responsible for the development, implementation and monitoring of the Company’s policy on external audit and the committee reserves oversight responsibility for monitoring independence, objectivity and compliance with ethical and regulatory requirements.
The committee recommends the appointment and reappointment of the Company’s external auditors and annually reviews a formal letter provided by the external auditors confirming their independence and objectivity within the context of applicable regulatory requirements and professional standards.
The committee also reviews the terms, areas of responsibility and scope of the audit (including schedules of unadjusted errors and representation letters) as set out in the external auditors’ engagement letter; the overall work plan for the forthcoming year, together with the cost-effectiveness of the audit as well as the auditors’ remuneration and performance; any major issues which arose during the course of the audit and their resolution; key accounting and audit judgements; the level of errors identified during the audit; and the recommendations made to management by the auditors and management’s response.
More details about the functions and operations of the Audit Committee can be seen in our current Annual Report and Accounts.