Members: Alison Reed (Chairman), Baroness Kingsmill, Chumpol NaLamlieng, Ken Smart, Baroness Symons, Jim Lawrence (until November 1, 2007).
The Board is satisfied that Alison Reed has recent and relevant financial experience for the purposes of paragraph C.3.1 of the Combined Code. The Committee met four times during 2007/08 and has held closed meetings and has also met privately with both the external and internal auditors.
Regular attendees at Committee meetings, at the invitation of the Committee, included the Chairman, the Chief Executive, Chief Financial Officer, the Head of Internal Control, the Group Financial Controller, the Group Reporting Manager and representatives from the external auditors.
The Audit Committee is responsible for exercising the full powers and authority of the Board in accounting and financial reporting matters. The full terms of reference, which were amended following the delisting from the New York Stock Exchange, are available on the Company’s website at bashares.com.
The key duties of the Committee include to:
- Monitor the integrity of the Company’s financial statements prior to their submission to the Board and any formal announcements relating to the Company’s financial performance;
- Review the Company’s financial statements to ensure that its accounting policies are the most appropriate to the Company’s circumstances and that its financial reporting presents a balanced and understandable assessment of the Company’s position and prospects;
- Keep under review the Company’s system of internal control, including compliance with the Company’s codes of conduct and the scope and results of the work of internal audit and of external audit, together with the independence and objectivity of the auditors;
- Oversee the performance, as well as the objectivity and independence, of the external auditor which it does by requiring reports from the auditor, a requirement to pre-approve fees for non-audit work and by ensuring that fees for non-audit work remain lower than those for audit work. The external auditor is only permitted to carry out work for the Group in the following categories: audit work; advice and assurance on accounting standards; tax and regulatory requirements; tax compliance, planning and advice; due diligence in relation to alliances, investments and joint ventures; and the provision of attestation reports or comfort letters confirming compliance or reasonableness as required by third parties. Managers are required to obtain prior approval before contracting such services from the external auditor. The Audit Committee has also specified certain non-audit services which the external auditor may not supply to the Group such as bookkeeping and actuarial services; and
- Take responsibility for the oversight of the Company’s policy on whistleblowers and the risk management process (see Internal Control).