Auditors

 

Deloitte LLP were appointed as the external auditor to the Group in 2009 following a formal tender process.

During the year, the Committee agreed the approach and scope of the audit work to be undertaken by the external auditor and undertook an assessment of their qualification, expertise and resources, independence and the effectiveness of the external audit process. The Committee also reviewed and agreed the terms of engagement, the fees, and areas of responsibility and the work to be undertaken by the external auditor, and agreed the fees payable in respect of the 2012/13 audit work. Details of the amounts paid to the external auditor for their audit services are given in note 7 to the accounts on page 75.

Each of the Group's businesses is consulted on the effectiveness and independence of the external auditor annually. In addition, the external auditor provides the Committee with a schedule of each matter on which there was an initial difference between them and management in relation to the accounting treatment, and with the final decisions on these issues. The Committee has reviewed and is satisfied with the effectiveness and independence of the external auditor.

In addition to their statutory duties, the services of Deloitte LLP are also engaged where, as a result of their position as external auditor, they either must, or are best placed to, perform the work in question. This is primarily work in relation to matters such as shareholder circulars, Group borrowings, tax advice, regulatory filings and certain business acquisitions and disposals. Other work is awarded on the basis of competitive tendering.

The Committee reviewed and approved the scope of non-audit services provided by the external auditor to ensure that there was no impairment of independence and objectivity, and subsequently monitored the non-audit work performed to ensure it was within policy guidelines.

The Group has a policy on the use of its external auditor for non-audit work and this is regularly reviewed. The external auditor is precluded from engaging in non-audit services that would compromise their independence or violate any laws or regulations affecting their appointment as external auditor. The approval of the Chairman of the Committee is required prior to awarding contracts for non-audit services to the external auditor, where in excess of specified amounts. The external auditor reports to the Committee annually on their independence from the Company. Periodic rotation of key audit partners is also required. More information can be found in the Use of External Auditors PDF (0.05Kb).

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