EasyJet 2011 Annual Report Download - page 50

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Corporate governance
Continued
The Board has reviewed the composition of the
Remuneration Committee during the year and is
satisfied that the Directors who are currently members
of this Committee are those who are best able to
contribute to the Committee’s objectives.
Shareholders are generally required to approve all
new Long Term Incentive Plans and significant
changes to existing plans. Further details of these
plans can be found in the Report on Directors’
remuneration and the full text of the terms of
reference for the Remuneration Committee is
available in the governance section of easyJet’s
corporate website, http://corporate.easyJet.com.
Audit Committee
The Audit Committee comprises four Non
Executive Directors, all of whom are independent.
At 30 September 2011, the Audit Committee
members were David Bennett (Chairman),
John Browett, Keith Hamill and Adèle Anderson.
This Committee meets at least three times per year.
The primary function of the Audit Committee is to
assist the Board in fulfilling its oversight responsibilities
by reviewing the financial reports and other financial
information in advance of publication, reviewing on a
continuing basis the systems of internal controls
regarding finance and accounting that management
and the Board have established and reviewing
generally the auditing, accounting and financial
reporting processes. The ultimate responsibility
for reviewing and approving the annual and other
accounts remains with the Board. The Audit
Committee has met three times during the course
of the year.
The terms of reference of the Audit Committee are
documented and agreed by the main Board. The full
text of the terms of reference is available in the
governance section of easyJet’s corporate website,
http://corporate.easyJet.com. The key terms set out
that the Audit Committee will:
–Serve as an independent and objective party to
monitor the quality and timeliness of the financial
reporting process and monitor the internal
financial control system
–Review and appraise the audit efforts of the
external auditors
–Provide an open avenue of communication
among the external auditors, financial and senior
management and the Board
–Confirm and assure the independence and
objectivity of the external auditors (in particular, in
the context of the provision of additional services
to the Company)
–Review and ensure the effectiveness of the risk
management processes of the Company
–Review and monitor the effectiveness of the
internal audit function and management’s
responsiveness to any findings and
recommendations; and
–Assess potential conflicts of interest of Directors
on behalf of the Board
The Audit Committee has the responsibility
for appointing the external auditors.
PricewaterhouseCoopers LLP were reappointed
auditors of the Group at the Annual General Meeting
held in February 2011. In order to preserve auditor
objectivity and independence,
PricewaterhouseCoopers LLP will not be asked to
provide consulting services unless this is in the best
interests of the Company. The Audit Committee’s
terms of reference set out that they are responsible
for the formal policy on the award of non-audit work
to the auditors. The Audit Committee has, during the
year, updated the policy, which can be found in the
governance section of easyJet’s corporate website,
http://corporate.easyJet.com. The auditors are asked
on an annual basis to articulate the steps that they
have taken to ensure objectivity and independence.
easyJet monitors the auditors’ performance, behaviour
and effectiveness during the exercise of their duties,
which informs, on an annual basis, the Audit
Committee’s decision to recommend reappointment.
This included this year obtaining a report on the
auditors own quality control procedures and a
consideration of their annual quality and transparency
report. In the financial year, easyJet spent £nil million
with PricewaterhouseCoopers LLP (2010: £0.1 million)
in respect of non-audit services. There are no
contractual obligations which restrict the choice
of external auditors.
Both internal and external auditors are given the
opportunity to meet privately with the Audit
Committee without any member of management
present. It is standard practice for the external auditors
to meet with the Audit Committee without the
Executive Directors being present at each Audit
Committee meeting.
The Board is satisfied that the Directors who are
currently members of this Committee are those who
are best able to contribute to the Committee’s
objectives. David Bennett has served as the Chairman
of the Committee during the year. David has
previously been an Executive Director of Abbey
National plc prior to which he was Chief Executive
Officer and Finance Director of Alliance and Leicester
plc, experience which the Board considers to be
recent and relevant for the purposes of undertaking
the role as Chairman of the Committee.
48
easyJet plc
Annual report
and accounts 2011