Vodafone 2014 Annual Report Download - page 96

An overview of the scope of our audit
The Group operates in 27 countries across two geographic regions. The Group has centralised certain transaction processing to nance shared
service centres in Hungary and India, with key judgements and the remaining transactions accounted for at the country or Group level. We have
centralised our audit procedures in the same locations and employed analytics technology to support the audit of the majority of the operating
companies in the Group.
Our Group audit was scoped by obtaining an understanding of the Group and its environment, including Group-wide controls, and assessing the
risks of material misstatement at the Group level. Our Group audit scope focused on the shared service centres, the Group functions and a further
seven operating locations: the UK, Germany, Italy, Spain, India, Vodacom and Turkey. The scope for the year ended 31 March 2014 included the
addition of Turkey and Cable & Wireless Worldwide (through the UK business) when compared to the scope for the year ended 31 March 2013.
All of these were subject to a full scope audit for the year ended 31 March 2014.
Together with the Group functions, which were also subject to a full scope audit, these operating locations represent the principal business units
of the Group and account for 77% of the Group’s revenue and 77% of the Group’s total assets. Audits of these operating locations were carried out
at a component materiality level of £100 million which is 40% of the Group audit materiality, or the local statutory materiality if lower.
In addition, audits are performed for local statutory purposes at a further 13 locations, which represent a further 22% of the Group’s revenue and
23% of the Group’s total assets. Audits of these locations are performed at a local materiality level calculated by reference to the scale of the
business concerned. Where possible, the timing of statutory audits is aligned to the full scope timetable and any signicant ndings are reported
to us.
In order to support our conclusion that there were no signicant risks of material misstatement of the aggregated nancial information of the
remaining components not subject to audit, we tested the consolidation process and carried out analytical procedures at the parent entity level.
The disposal of the Group’s interest in Verizon Wireless was also audited at this level, supported by review procedures on the trading results of the
business conducted in the United States.
The Group audit team continued to follow a programme of planned visits that has been designed so that the Senior Statutory Auditor or his
designate visits each of the seven locations where the Group audit scope was focused at least twice a year. Other locations are visited on the basis
of ongoing risk-assessment. Our visits are timed to allow the Group audit team to be involved in the planning process for the year end audit, including
assessment of risks of material misstatement and planned response, to attend the audit closing meetings and to assist in the resolution of audit and
accounting issues. We also ensure we have on-going communication with component teams throughout the year.
Total assets
Full audit scope: 77%
Local statutory audit: 23%
Revenue
Local statutory audit: 22%
Specied audit procedures: 1%
Full audit scope: 77%
Impact of changes to materiality on audit scope
We consider that, if materiality were to be reduced to £125 million, full scope component audits would be required in the Netherlands and Egypt
which would add 7% of revenue and 4% of total assets to the overall full scope coverage.
Opinion on other matters prescribed by the Companies Act 2006
In our opinion:
a the part of the Directors’ Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006; and
a the information given in the Strategic Report and the Directors’ Report for the nancial year for which the nancial statements are prepared
is consistent with the nancial statements.
Matters on which we are required to report by exception
Adequacy of explanations received and accounting records
Under the Companies Act 2006 we are required to report to you if, in our opinion:
a we have not received all the information and explanations we require for our audit; or
a adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from
branches not visited by us; or
a the parent company nancial statements are not in agreement with the accounting records and returns.
We have nothing to report in respect of these matters.
Vodafone Group Plc
Annual Report 201494
Audit report on the consolidated and parent company nancial statements (continued)