Carphone Warehouse 2016 Annual Report Download - page 52

Audit Committee Report
50
Chairman’s statement
Introduction
I am pleased to present the report of the Audit Committee for
the year ended 30 April 2016. In this covering letter I set out
our key areas of activity in delivering on our objective of
ensuring that Dixons Carphone’s financial reporting and risk
management systems of internal control are effective and
appropriate.
Building on the activity and reporting of the Merger in
2014/15, this year the Committee has focused on overseeing
the bedding-down of reporting in the complex regulatory
and governance environment in which the Group operates.
This has entailed ensuring that the assurance activities
encompass, in proportionate measure, non-regulated and
regulated operations, the international footprint and the
risk profile of the Group. We have also considered the
terms of reference and workings of the Group Risk &
Compliance Committee.
New reporting requirements
The Committee considered the Group’s response to and
conformance with the new requirements of the 2014 UK
Corporate Governance Code (the ‘Code’) and the Financial
Reporting Council (‘FRC’) Guidance on Risk Management,
Internal Control and Related Financial and Business Reporting.
In particular this includes adopting the longer-term viability
statement for the first time. Management recommended a
three-year viability period to align with the Group’s strategic
planning and forecasting process together with sensitivities
and assumptions based around the principal risks and related
mitigating actions. The Committee concluded that the
approach was appropriate and recommended adoption of the
viability statement by the Board.
Key activities
The Committee’s work, carried out during the year, included:
•fully considering the requirements of the Code and its
application to the Annual Report and Accounts 2015/16,
including complying with new provisions relating to the
robust assessment of risks and the viability statement;
•considering significant accounting and reporting
judgements, including the appropriateness of the Group’s
going concern position;
•considering and recommending that the Annual Report and
Accounts 2015/16, when taken as a whole, are fair,
balanced and understandable;
•reviewing the effectiveness of the risk management system
and internal controls, operated by management;
•considering and approving the viability statement, more
information on which can be found on page 29, and the
assessment and challenging of the analysis performed by
management to reach the conditions underpinning it;
•receiving presentations and subsequent updates from
management on such matters as succession planning and
talent management, businesses regulated by the Financial
Conduct Authority (‘FCA’) and IT strategy; and
•considering the robustness of the online services
information security environment, which was the subject of
a cyber-attack in August 2015 and the appropriateness of
the immediate actions taken to secure the impacted
systems and additional security measures put in place to
help prevent further attacks.
Looking ahead
As the Group continues to develop new business areas in
line with its strategy and business plans, we expect the
Committee to remain busy.
The work programme will be responsive to the changing
risk profile, the developing business model, the regulatory
environment, and the changing shape of the systems
(including IT) architecture. The risk assessment has been
diligently prepared by the Group’s management at all levels.
We are mindful of the need to remain vigilant as we know
that not all risks can be eliminated in the challenging
environment in which we operate.
I will be in attendance at the forthcoming Annual General
Meeting and will be available to talk to you then. In the
meantime if you have any questions please do get in touch.
Jock Lennox
Chairman of the Audit Committee
28 June 2016
00_DC 2016 Annual Report.pdf 50 11/07/2016 18:34
Corporate Governance
Dixons Carphone plc Annual Report and Accounts 2015/16