National Grid 2014 Annual Report Download - page 51

Strategic Report Corporate Governance Financial Statements Additional Information
Significant issues
Some of the significant issues the Audit Committee considered
inrelation to the financial statements during the year set out
beloware explained in more detail later in the report:
• US financial controls program;
• LIPA MSA transition contract accounting;
• presentation of exceptional items; and
• fair, balanced and understandable assessment.
Other matters reviewed
Examples of other matters the Audit Committee reviewed:
• accounting for RIIO;
• the enhanced disclosures required by International Auditing
Standard (UK and Ireland) 700;
• the Company’s refreshed approach to going concern following
the publication of the Sharman Report;
• the increased work involved to support the LIPA MSA transition;
• the revised Certificate of Assurance process;
• Sarbanes-Oxley Act 2002 testing and attestations;
• external reporting obligations and the programme to improve
the Company-wide framework;
• a revised ethical business conduct process for Directors and
executive members; and
• a proposed revised approach to risk reporting.
Committee membership and attendance
Committee membership during the year and attendance at
meetings is set out below. Attendance is expressed as the number
of meetings attended out of the number possible or applicable
forthe individual Director during the year to 31 March 2014.
Biographical details and experience of Committee members are
set out on pages 171 to 173.
Name Attendance
Mark Williamson (chairman)16 of 6
Philip Aiken 5 of 6
Ruth Kelly 6 of 6
Maria Richter 6 of 6
George Rose22 of 2
1. Chairman from July 2013.
2. George Rose stepped down from the Board with effect from 29 July 2013.
Experience
Mark Williamson took over as chairman of the Audit Committee
following the 2013 AGM. The Board has determined that Mark:
• has recent and relevant financial experience;
• is a suitably qualified audit committee financial expert within
themeaning of the SEC requirements; and
• is independent within the meaning of the New York Stock
Exchange listing rules.
Role
Oversees the Company’s financial reporting, and internal
controlsand their effectiveness, together with the procedures for
identifying, assessing and reporting risks. It also oversees the
services provided by the external auditors and their remuneration.
Review of the year
My first eight months as chairman have been busy but enjoyable.
Last July we said goodbye to George Rose and this July Maria
Richter will be stepping down from the Board. I would like to thank
them both for their contribution to the Committee. In particular to
George for his guidance and support during his handover to me.
As a committee we have held six meetings during the year, two
ofwhich were held in the US, providing all members with the
opportunity to meet our US teams. Following last year’s committee
performance evaluation, we now also meet privately after some of
our longer meetings. We use this time to review the meeting and
discuss how we can evolve and make our meetings more effective.
The Committee’s main focus has been the US finance function
and ongoing improvement of the new enterprise resource system.
The Committee has received regular reports throughout the year
from the Finance Director and US Chief Financial Officer.
The UK finance team has provided valuable support to the US
team and I visited the US with the Finance Director and Group
Financial Controller in January to review progress and priorities
for2014. The work on stabilisation of the systems also coincided
with the LIPA MSA transition. This was an important milestone in
the overall US financial control program.
With the start of RIIO, the Committee received a paper from the
UK finance team on the accounting implications of this new
arrangement and its impact on the financial control environment.
We also reviewed the disclosures within this Annual Report to
ensure they provide a fair, balanced and understandable view
inthe context of current accounting standards.
Next year is also looking busy with an ongoing focus on the
enterprise resource system and continual improvement in
processes and controls around these systems.
Mark Williamson
Committee chairman
Audit Committee
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