Barclays 2004 Annual Report Download - page 42

Corporate governance
Accountability and audit
40
Accountability and Audit
Going Concern
The Directors confirm they are satisfied that the Company and
the Group have adequate resources to continue in business for the
foreseeable future. For this reason, they continue to adopt the ‘going
concern’ basis for preparing the accounts.
Internal Control
The Directors have responsibility for ensuring that management
maintain an effective system of internal control and for reviewing
its effectiveness. Such a system is designed to manage rather than
eliminate the risk of failure to achieve business objectives, and can
only provide reasonable and not absolute assurance against material
misstatement or loss. Throughout the year ended 31st December
2004, and to date, the Group has operated a system of internal control
which provides reasonable assurance of effective and efficient
operations covering all controls, including financial and operational
controls and compliance with laws and regulations. Processes are in
place for identifying, evaluating and managing the significant risks
facing the Group in accordance with the guidance ‘Internal Control:
Guidance for Directors on the Combined Code’ issued by the Institute
of Chartered Accountants in England and Wales. The Board regularly
reviews these processes through the Board Committees.
The Directors review the effectiveness of the system of internal control
annually. An internal control compliance certification process is
conducted throughout the Group in support of this review. The
effectiveness of controls is periodically reviewed within the business
areas. Quarterly risk reports are made to the Board covering risks of
Group significance including credit risk, market risk, operational risk,
and legal and compliance risk. Regular reports are made to the Board
Audit Committee by management, Internal Audit and the compliance
and legal functions covering particularly financial controls, compliance
and operational controls. Reports covering risk measurement
standards and risk appetite are made to the Board Risk Committee.
The key document for the Group’s internal control processes is the
record of Group Governance practices which describes the Group’s
governance and control framework and details Group policies and
processes. The record of Group Governance practices is reviewed
and approved on behalf of the Group Chief Executive by the Group
Governance and Control Committee. Further details of risk
management procedures are given in the Risk management section
on pages 44 to 85.
The system of internal financial and operational controls is also
subject to regulatory oversight in the United Kingdom and overseas.
Further information on supervision by the financial services regulators
is provided under Supervision and regulation on pages 90 and 91.
Statement of Directors’ Responsibilities for Accounts
The following statement, which should be read in conjunction with
the Auditors’ report set out on page 122, is made with a view to
distinguishing for shareholders the respective responsibilities of the
Directors and of the auditors in relation to the accounts.
The Directors are required by the Companies Act 1985 to prepare
accounts for each financial year which give a true and fair view of
the state of affairs of the Company and Group as at the end of the
financial year and of the profit or loss for the financial year.
The Directors consider that, in preparing the accounts on pages 124
to 224 and 228 to 237, and the additional information contained on
pages 27 to 39, the Group has used appropriate accounting policies,
consistently applied and supported by reasonable and prudent
judgements and estimates, and that all accounting standards which
they consider to be applicable have been followed.
The Directors have responsibility for ensuring that the Company and
the Group keep accounting records which disclose with reasonable
accuracy the financial position of the Company and the Group and
which enable them to ensure that the accounts comply with the
Companies Act 1985.
The Directors have general responsibility for taking such steps as are
reasonably open to them to safeguard the assets of the Group and to
prevent and detect fraud and other irregularities.
Signed on behalf of the Board
Matthew W Barrett
10th March 2005
Disclosure Controls and Procedures
The Group Chief Executive, John Varley, and the Group Finance
Director, Naguib Kheraj, conducted with Group Management an
evaluation of the effectiveness of the design and operation of the
Group’s disclosure controls and procedures as at 31st December 2004,
which are defined as those controls and procedures designed to ensure
that information required to be disclosed in reports filed or submitted
under the US Securities Exchange Act of 1934 is recorded, processed,
summarised and reported within specified time periods. As of the
date of the evaluation, the Group Chief Executive and Group Finance
Director concluded that the design and operation of these disclosure
controls and procedures were effective. No significant changes were
made in our internal controls or in other factors that could
significantly affect these controls subsequent to their evaluation.