Experian 2013 Annual Report Download - page 30
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Please find page 30 of the 2013 Experian annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.WHAT ADDITIONAL INTERNAL CONTROLS SUPPORT FINANCIAL REPORTING?
Detailed policies and procedures are in place to ensure the accuracy and reliability of financial reporting and the preparation of consolidated financial
statements. A comprehensive Group Accounting Manual (‘GAM’), including details of International Financial Reporting Standards (‘IFRS’) requirements, is
in place. The document is owned by the Group’s finance team and has been rolled out across the Group. All Experian companies are obliged to follow the
requirements of the GAM. The aims of the GAM are to:
• provide guidance on accounting issues; allow
for consistent and well-defined information
for IFRS reporting requirements;
• provide uniform measures for quantitative and
qualitative measures of Group performance; and
• increase the efficiency of the Group’s
reporting process.
DEPENDENCE UPON THIRD PARTIES TO PROVIDE DATA AND CERTAIN OPERATIONAL SERVICES
Performance indicator
EBIT and total revenue
growth
Strategic alignment
• New customer segments
• Expanding geographically
• Product innovation
Description of risk and potential impact
Our business model is dependent upon third parties to provide data,
intellectual property and certain operational services (service providers), the
loss of which could significantly impact the quality of, and demand for, our
products. We rely upon data and services from external sources, including
customers, strategic partners and various government and public record
services. Our service providers could withhold their data and terminate
services for a variety of reasons. If certain key service providers were to
terminate or be unable to provide their data and services, our ability to
provide our products and services could be impacted, and in some cases
result in us being unable to offer services, which may have a materially
adverse effect on our business, reputation and operating results.
Similarly, if one of our service providers, including third parties with
whom we have strategic relationships, were to experience financial and/or
operational difficulties, their services to us may suffer or they may no longer
be able to provide services to us at all. This could have a significant impact
on the delivery of our products and/or services, which may have a materially
adverse effect on our business, reputation and operating results.
How we manage this risk
Service providers are covered by legal contracts that contain appropriate terms
to ensure that the service providers have the right to provide Experian with
the data and services for the required purpose. Our global strategic sourcing
activities support the selection and negotiation of agreements with a diverse
network of service providers based on criteria such as delivery assurance
and reliability in order to minimise potential disruptions. There are a variety
of protections relating to critical service provider relationships. For instance,
there are contractual requirements to maintain appropriate business continuity
arrangements that we have the right to audit, long-term agreements, adequate
notice provisions for termination and/or renegotiation of terms, and economic
incentives to continue mutually advantageous relationships.
Change from 2012
Stable
2013 update
We continue to enter into long-term
contracts with data providers as well
as securing access to data sources
through acquisitions. We analyse the
data to make sure we are receiving
the best value and highest quality.
What are the risks and uncertainties?
PRINCIPAL RISKS
Throughout the year we have critically reviewed and evaluated the risks Experian faces. Our assessment of the most significant risks and uncertainties
that could impact Experian’s long-term performance is outlined in this section of the report. These risks are not set out in any order or priority and they
do not comprise all the risks and uncertainties we face. This list is not exhaustive and it is likely to change as some risks assume greater importance than
others during the course of the year.
LOSS OR INAPPROPRIATE USAGE OF DATA
Performance indicator
EBIT, employee engagement
and general litigation trends
Strategic alignment
• New customer segments
• Expanding geographically
• Product innovation
Further information
Corporate responsibility
section – use and protect
data properly
Description of risk and potential impact
Experian owns and/or processes a large amount of highly sensitive
and confidential consumer information including financial information,
personally identifiable information and protected health information. Data
security and integrity are critically important to Experian’s business. Cyber-
attacks and other breaches of security, lost, misappropriated or misused
data or the perception that confidential information is not secure may result
in a material loss of business, substantial legal liability or significant harm to
our reputation. Our partners or third-party contractors may also experience
security breaches involving the storage and transmission of our data and
other proprietary information.
How we manage this risk
We maintain physical security measures, technical controls and contractual
precautions to identify, detect and prevent the unauthorised access of our data.
Change from 2012
Stable
2013 update
Several highly publicised data
security breaches at other companies
have heightened consumer
awareness of this issue. We continue
to invest in IT security solutions, and
execute a sound security strategy
that allows for layered protections
across our technology infrastructure.
28 Experian Annual Report 2013 Business overview