Vodafone 2003 Annual Report Download - page 57

Vodafone Group Plc Annual Report & Accounts and Form 20-F 2003 55
the key assumptions made in the analysis. Post investment appraisals of the
Group’s investments are conducted on a periodic and timely basis.
A Treasury Report is distributed electronically on a daily basis that reports on
treasury borrowings and investments.
The Board reviews a half-yearly report detailing any significant legal actions
faced by Group companies.
The Group Policy Committee monitors legal, environmental and regulatory
matters and approves appropriate responses or amendments to existing policy.
Monitoring and review activities
There are clear processes for monitoring the system of internal control and
reporting any significant control failings or weaknesses together with details of
corrective action.
A formal annual confirmation is provided by the chief executive officer and chief
financial officer of each Group company detailing the operation of their control
systems and highlighting any weaknesses. Regional management, the Audit
Committee and the Board review the results of this confirmation.
The Chief Executive and the Financial Director undertake a review of the quality
and timeliness of disclosures that includes formal annual meetings with the
regional chief executives and the Company’s Disclosure Committee.
A Group Internal Audit Department, reporting directly to the Audit Committee,
undertakes periodic examination of business processes on a risk basis and
reports on controls throughout the Group.
Reports from the external auditors, Deloitte & Touche, on certain internal controls
and relevant financial reporting matters, are presented to the Audit Committee
and management.
Review of effectiveness
The directors, the Chief Executive and the Financial Director consider that the
Group’s internal controls and procedures provide reasonable assurance that
problems are identified on a timely basis and dealt with accordingly. In reaching
this conclusion, the directors, the Chief Executive and the Financial Director have
evaluated within the past 90 days the effectiveness of the system of internal
control and the disclosure controls and procedures through the monitoring
process set out above. They are not aware of any significant weakness or
deficiency in the design or operation of internal controls. The directors, the Chief
Executive and the Financial Director have concluded that the disclosure controls
and procedures are effective for the year under review and to the date of
approval of the Annual Report.
No matter how well designed and operated, the directors, the Chief Executive
and the Financial Director consider that any controls and procedures can provide
only reasonable and not absolute assurance of achieving the desired control
objectives. The Group’s management is required to apply judgement in evaluating
the risks facing the Group in achieving its objectives, in determining the risks
that are considered acceptable to bear, in assessing the likelihood of the risks
concerned materialising, in identifying the company’s ability to reduce the
incidence and impact on the business of risks that do materialise and in ensuring
the costs of operating particular controls are proportionate to the benefit.
There were no significant changes in the Company’s internal controls or in other
factors that could significantly affect internal controls subsequent to the date of
their most recent evaluation.
Relations with Shareholders
The Company holds briefing meetings with its major institutional shareholders in
the UK, the US and in Continental Europe, usually twice each year after the
interim and preliminary final results announcements, to ensure that the investing
community receives a balanced and complete view of the Group’s performance
and the issues faced by the business. Telecommunications analysts of
stockbrokers are also invited to presentations of the financial results. The
Company, through its Investor Relations team, responds to enquiries from
institutional shareholders.
The principal communication with private investors is through the provision of the
Annual Review & Summary Financial Statement, the interim results and the
Annual General Meeting, an occasion which generally is attended by all the
Company’s directors and at which all shareholders present are given the
opportunity to question the Chairman and the Board as well as the Chairmen of
the Audit, Remuneration and Nominations Committees. All resolutions at the
Company’s Annual General Meetings are decided on a poll. The proxy votes cast
in relation to all resolutions are disclosed to those in attendance at the meeting
and the results of the poll are published in national newspapers in the UK, US
and Ireland. Financial and other information is made available on the Company’s
web site, www.vodafone.com, which is regularly updated.