BT 2011 Annual Report Download - page 88

85BT GROUP PLC ANNUAL REPORT & FORM 20-F 2011
REPORT OF THE DIRECTORS
REPORT OF THE DIRECTORS BUSINESS POLICIES
US Sarbanes-Oxley Act of 2002
BT has securities registered with the US Securities and Exchange
Commission (SEC). As a result, we must comply with those
provisions of the Sarbanes-Oxley Act applicable to foreign issuers.
We comply with the legal and regulatory requirements introduced
pursuant to this legislation, in so far as they are applicable.
The
Audit & Risk Committee includes members Phil Hodkinson and
Nick Rose who, in the opinion of the Board, are ‘audit committee
financial experts’ and who are independent (as defined for this
purpose). The Board considers that the Committee’s members have
broad commercial knowledge and extensive business leadership
experience, having held between them various prior roles in major
business, Government, financial management, treasury and
financial function supervision and that this constitutes a broad and
suitable mix of business and financial experience on the Committee.
The code of ethics adopted for the purposes of the Sarbanes-Oxley
Act is posted on the company’s website at www.bt.com/ethics. The
code applies to the Chief Executive, Group Finance Director and
senior finance managers.
Disclosure controls and procedures
The Chief Executive and Group Finance Director, after evaluating
the effectiveness of BT’s disclosure controls and procedures as of
the end of the period covered by this Annual Report & Form 20-F,
have concluded that, as of such date, BT’s disclosure controls and
procedures were effective to ensure that material information
relating to BT was made known to them by others within the group.
The Chief Executive and Group Finance Director concluded that BT’s
disclosure controls and procedures are also effective to ensure that
the information required to be disclosed by the company in reports
that it files under the Exchange Act is recorded, processed,
summarised and reported within the time periods specified in the
rules and forms of the SEC.
The Chief Executive and Group Finance Director have also provided
the certifications required by the Sarbanes-Oxley Act.
Internal control over financial reporting
BT’s management is responsible for establishing and maintaining
adequate internal control over financial reporting for the group
including the consolidation process. Internal control over financial
reporting is designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial
statements for external reporting purposes in accordance with
IFRS. Management conducted an assessment of the effectiveness
of internal control over financial reporting based on the framework
for internal control evaluation contained in the Turnbull Guidance.
Based on this assessment, management has concluded that as at
31 March 2011, BT’s internal control over financial reporting was
effective.
There were no changes in BT’s internal control over financial
reporting that occurred during 2011 that have materially affected,
or are reasonably likely to have materially affected, the group’s
internal control over financial reporting. Any significant deficiency,
as defined by the US Public Company Accounting Oversight Board
(PCAOB), in internal control over financial reporting, is reported to
the
Audit & Risk Committee . PricewaterhouseCoopers LLP, which
has audited the consolidated financial statements for 2011, has
also audited the effectiveness of the group’s internal control over
financial reporting under Auditing Standard No.5 of the PCAOB.
Their report is on page 90.
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