Vodafone 2011 Annual Report Download - page 78

76 Vodafone Group Plc Annual Report 2011
Because of the inherent limitations of internal control over financial
reporting, including the possibility of collusion or improper management
override of controls, material misstatements due to error or fraud may not
be prevented or detected on a timely basis. Also, projections of any
evaluation of the effectiveness of the internal control over financial
reporting to future periods are subject to the risk that the controls may
become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
In our opinion, the Group maintained, in all material respects, effective
internal control over financial reporting as of 31 March 2011, based on the
criteria established in Internal Control – Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission.
We have also audited, in accordance with the standards of the Public Company
Accounting Oversight Board (United States), the consolidated financial
statements of the Group as of and for the year ended 31 March 2011, prepared
in conformity with International Financial Reporting Standards (‘IFRS’), as
adopted by the European Union and IFRS as issued by the International
Accounting Standards Board. Our report dated 17 May 2011 expressed an
unqualified opinion on those financial statements.
Deloitte LLP
Chartered Accountants and Registered Auditor
London
United Kingdom
17 May 2011
Please refer to our Form 20-F to be filed with the Securities and Exchange
Commission on 1 June 2011 for the audit opinion over the consolidated
financial statements of the Group as of 31 March 2011 and 2010 and for each
of the three years in the period ended 31 March 2011 issued in accordance
with the standards of the Public Company Accounting Oversight Board
(United States).
Report of independent registered public accounting
rm to the members of Vodafone Group Plc
We have audited the internal control over financial reporting of Vodafone
Group Plc and subsidiaries and applicable joint ventures (the ‘Group’) as of
31 March 2011 based on criteria established in Internal Control – Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission. As described in management’s report on internal
controls over financial reporting, management has excluded from its
assessment the internal control over financial reporting of those entities
that are accounted for under the equity method, including Verizon Wireless
and Société Française du Radiotéléphone S.A. (“SFR”), because the Group
does not have the ability to dictate or modify controls at these entities and
does not have the ability to assess, in practice, the controls at these entities.
Accordingly, the internal controls over financial reporting of these entities,
which contributed a net profit of £5,059 million to the profit for the financial
year, have not been assessed, except relating to the Group’s controls over
the recording and related disclosures of amounts relating to the investments
that are recorded in the consolidated financial statements.
The Group’s management is responsible for maintaining effective internal
control over financial reporting and for its assessment of the effectiveness
of internal control over financial reporting, included in the accompanying
management’s report on internal control over financial reporting. Our
responsibility is to express an opinion on the Group’s internal control over
financial reporting based on our audit.
We conducted our audit in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance
about whether effective internal control over financial reporting was
maintained in all material respects. Our audit included obtaining an
understanding of internal control over financial reporting, assessing the risk
that a material weakness exists, testing and evaluating the design and
operating effectiveness of internal control based on the assessed risk, and
performing such other procedures as we considered necessary in
the circumstances. We believe that our audit provides a reasonable basis for
our opinion.
A company’s internal control over financial reporting is a process designed by,
or under the supervision of, the company’s principal executive and principal
financial officers, or persons performing similar functions, and effected by the
company’s board of directors, management, and other personnel to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A company’s internal control over
financial reporting includes those policies and procedures that (1) pertain to
the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets of the company; (2)
provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the
company are being made only in accordance with authorisations of
management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorised
acquisition, use, or disposition of the company’s assets that could have a
material effect on the financial statements.
Audit report on internal controls