Carphone Warehouse 2008 Annual Report Download - page 41

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Following such performance evaluation the Chairman confirms that all
those Non-Executive Directors seeking election or re-election at the
Annual General Meeting continue to be effective and demonstrate a
commitment to the role, including having time to attend all necessary
meetings and to carry out other appropriate duties.
The Chairman meets regularly with all the Independent Non-Executive
Directors usually in the evening prior to a Board meeting. This provides
the opportunity to raise any questions regarding the performance of the
Executive Directors or in respect of any other matters.
The Senior Independent Director also met with the Non-Executive
Directors, in the absence of the Chairman, to assess the Chairman’s
effectiveness, having first reviewed the results of a performance evaluation
questionnaire completed by all the Directors apart from the Chairman.
The Board is of the opinion that the Chairman had no other significant
commitments during the period that would have affected his performance
in his role.
External appointments
The Board supports Executive Directors taking up Non-Executive
Directorships as part of their continued development, and the Board
believes that this will ultimately benefit the Company. Further details
are provided in the Remuneration Report on pages 32 to 38.
Board Committees
There are six key Board Committees: Audit, Remuneration, Nomination,
Insurance Compliance, Consumer Regulation Compliance (formally
Telecoms Regulatory Compliance) and Group Finance. The Committees
are provided with sufficient resources via the Company Secretary and,
where necessary, have direct access to independent professional
advisors to undertake their duties.
Audit Committee
The Committee currently comprises the following Independent Non-
Executive Directors: David Grigson (Chairman), Sir Brian Pitman, Adrian
Martin, David Mansfield, Steven Esom and Baroness Morgan. Adrian
Martin served as Chairman throughout the period, subsequent to which
he stood down, and David Grigson was appointed as Chairman. All of
the Committee members have extensive commercial experience. The
Committee met formally three times during the period. All members
attended each meeting, with the exception of Sir Brian Pitman who was
absent from the meetings on 30 October 2007 and 31 January 2008
and David Grigson who was also absent from the meeting on 31 January
2008. These absences were due to prior engagements that could not
be changed with the exception of David Grigson who had to attend an
emergency meeting in respect of Reuters Group PLC.
The Chairman of the Committee updates the Board on any significant
issues that may have arisen at the Board meeting following each
Committee meeting. During the period, all the requirements of the Code
in respect of the Committee were met. The work undertaken by the
Committee is described within the following sections of this Report.
The Group’s Chief Financial Officer and other senior management attend
Committee meetings by invitation of the Committee. Representatives of
the Company’s external auditors and the other senior executives from
Finance, Tax, Treasury, Legal and Risk and Assurance also attend these
meetings by invitation of the Committee. The external and internal auditors
have direct access to the Committee during formal meetings and time
is set aside for them to have private discussions with the Committee,
in the absence of management.
The Committee’s terms of reference, which are available on request from
the Company Secretary and are published on the Company’s website,
comply with the Code. During the period, the formal calendar of items
considered at each Audit Committee meeting within each annual cycle
embraced the Code requirements to:
• monitor the integrity of the financial statements of the Company, and any
formal announcements relating to the Company’s financial performance,
including reviewing significant financial reporting judgements contained
in them;
• review the Company’s internal financial controls and its internal control and
risk management systems and to make recommendations to the Board;
• review the Company’s arrangements by which employees may raise
concerns in confidence;
• monitor and review the effectiveness of the Company’s internal audit function;
• make recommendations to the Board in relation to the appointment,
re-appointment and removal of external auditors and to approve their
remuneration and terms of engagement;
• review and monitor the external auditors’ independence and objectivity
and the effectiveness of the audit process, taking into consideration
relevant UK professional and regulatory requirements; and
• review the Company’s policy on the engagement of the external auditors
to supply non-audit services. In this context the Committee’s remit
requires it to report to the Board identifying any matters in respect of
which it considers that action or improvement is needed and to make
recommendations as to the steps to be taken.
In light of the assessments and review undertaken, the Committee
recommended to the Board that Deloitte & Touche LLP be retained as
auditors of the Company. This recommendation was endorsed by the Board.
The policy relating to the provision of non-audit services by the external
auditors specifies the types of work from which the external auditors are
excluded; for which the external auditors can be engaged without referral
to the Committee; and for which a case-by-case decision is required.
In order to safeguard the auditors’ objectivity and independence, the ratio
of non-audit fees to audit fees is monitored by the Committee within an
overall limit set by the Board on the recommendation of the Committee.
A statement of fees paid or accrued for services from the external auditors
during the period is set out below:
2008 2007
£m £m
Audit services:
– statutory audit 1.6 1.4
Tax services 0.3 0.1
Other services 0.3 0.1
Total 2.2 1.6
Certain non-audit services are pre-approved by the Committee depending
upon the nature and size of the service. Tax services principally comprise
technical advice associated with relevant UK and international fiscal laws
and regulations and, in particular, assessment of the potential implications
of proposed corporate transactions or restructuring. Having undertaken
a review of the non-audit related work, the Committee has satisfied itself
that the services undertaken during the period did not prejudice the
external auditors’ independence.
Governance