Peachtree 2013 Annual Report Download - page 93

Independent auditors’ report to the members of The Sage Group plc
The Sage Group plc | Annual Report & Accounts 2013 91
Financial statements
Report on the Group financial statements
Our opinion
In our opinion the Group financial statements:
–give a true and fair view of the state of the Group’s affairs as
at 30 September 2013 and of the Group’s profit and cash flows
for the year then ended;
–have been properly prepared in accordance with International
Financial Reporting Standards (“IFRSs”) as adopted by the European
Union; and
–have been prepared in accordance with the requirements of the
Companies Act 2006 and Article 4 of the IAS Regulation.
This opinion is to be read in the context of what we say below.
What we have audited
The Group financial statements, which are prepared by The Sage
Group plc, comprise:
–the Consolidated balance sheet as at 30 September 2013;
–the Consolidated income statement and Consolidated statement
of comprehensive income for the year then ended;
–the Consolidated statement of changes in equity and Consolidated
statement of cash flows for the year then ended; and
–The Notes to the Group financial statements, which include
a summary of significant accounting policies and other
explanatory information.
The financial reporting framework that has been applied in their
preparation comprises applicable law and IFRSs as adopted by
the European Union.
What an audit of financial statements involves
We conducted our audit in accordance with International Standards
on Auditing (UK and Ireland) (“ISAs (UK & Ireland)”). An audit involves
obtaining evidence about the amounts and disclosures in the financial
statements sufficient to give reasonable assurance that the financial
statements are free from material misstatement, whether caused by
fraud or error. This includes an assessment of:
–whether the accounting policies are appropriate to the Group’s
circumstances and have been consistently applied and adequately
disclosed;
–the reasonableness of significant accounting estimates made
by the directors; and
–the overall presentation of the financial statements.
In addition, we read all the financial and non-financial information in the
Annual Report & Accounts (the “Annual Report”) to identify material
inconsistencies with the audited Group financial statements and to
identify any information that is apparently materially incorrect based
on, or materially inconsistent with, the knowledge acquired by us in the
course of performing the audit. If we become aware of any apparent
material misstatements or inconsistencies we consider the implications
for our report.
Overview of our audit approach
Materiality
We set certain thresholds for materiality. These helped us to determine
the nature, timing and extent of our audit procedures and to evaluate
the effect of misstatements, both individually and on the financial
statements as a whole.
Based on our professional judgment, we determined materiality for
the Group financial statements as a whole to be £16m. In arriving
at this judgement we had regard to profit before tax adjusted for
non-recurring loss on disposal charges.
We agreed with the Audit Committee that we would report to them
misstatements identified during our audit above £0.8m as well as
misstatements below that amount that, in our view, warranted reporting
for qualitative reasons.
Overview of the scope of our audit
The Group’s trading operations are made up of operating businesses
situated in a number of territories across the globe. The Group financial
statements are a consolidation of 24 reporting units, comprising the
Group’s operating businesses and head office function.
In establishing the overall approach to the Group audit, we determined
the type of work that needed to be performed at the reporting units by
us, as the Group engagement team, or component auditors within PwC
UK and from other PwC network firms operating under our instruction.
Where the work was performed by component auditors, we determined
the level of involvement we needed to have in the audit work at those
reporting units to be able to conclude whether sufficient appropriate
audit evidence had been obtained as a basis for our opinion on the
Group financial statements as a whole.
Accordingly, of the Group’s 24 reporting units, we identified 12 which,
in our view, required an audit of their complete financial information,
either due to their size, or their risk characteristics. As part of our
planning procedures, the Group team visited the UK, French and North
America teams (the three most significant units in the Group) in the year
ended 30 September 2013. Specific audit procedures on certain
balances and transactions were performed at a further one reporting
unit on request of the Audit Committee. This, together with additional
procedures performed at the Group level, gave us the evidence we
needed for our opinion on the Group financial statements as a whole.
91The Sage Group plc | Annual Report & Accounts 2013
GovernanceStrategic report Financial statements