Vodafone 2016 Annual Report Download - page 49

Key objectives:
The provision of effective governance over the appropriateness
of the Group’s nancial reporting, including the adequacy
of related disclosures, the performance of both the internal
audit function and the external auditor and oversight over the
Group’s system of internal control including risk management and
compliance activities.
Responsibilities:
The Board has approved terms of reference for the Committee
which are available at vodafone.com/governance. These provided
the framework for the Committee’s work in the year and can
be summarised into four primary sets of activities. These are
oversight of the:
a appropriateness of the Group’s external nancial reporting;
a relationship with, and performance of, the external auditor;
a Group’s system of internal control, including risk management
framework and the work of the internal audit function; and
a Group’s system of compliance activities.
The 2016 nancial year has seen the Committee’s activities
and terms of reference reviewed and expanded to reect the
Group’s adoption of the 2014 UK Corporate Governance Code,
to cover:
a providing advice to the Board on the assessment, management
and mitigation of the principal risks facing the Group;
a monitoring the Group’s risk management system and its
effectiveness; and
a providing advice on how the Group’s prospects have
been assessed in order to make the new longer-term
viabilitystatement.
Audit and
Risk Committee
The Committee continued to focus its work on
the Group’s nancial reporting, nancial control and
risk management and compliance processes. The
Committee’s role was expanded this year to provide
assistance to the Board with assessing compliance with
elements of the 2014 UK Corporate Governance Code.
Board committees
Chairman and
nancial expert
Nick Land
Independent Non-Executive Director
Membership
The membership of the Committee has been selected with the
aim of providing the range of nancial and commercial expertise
necessary to meet its responsibilities. Given my experience, I continue
to be designated as the nancial expert on the Committee for the
purposes of the US Sarbanes-Oxley Act and the UK Corporate
Governance Code. There were no changes to the membership of the
Committee during the year, all of whom are Non-Executive Directors
of the Company.
How the Committee operates
The Committee met ve times during the year under its standard
schedule of meetings, an increase from the four meetings in the
last nancial year, a change reecting its increased responsibilities
particularly in relation to risk management. Meetings of the Committee
generally take place the day before a Board meeting to maximise
the efciency of interaction with the Board and I report to the Board,
as a separate agenda item, on the activity of the Committee and matters
of particular relevance to the Board in the conduct of its work.
The external auditor, PricewaterhouseCoopers LLP, is invited to each
meeting together with the Chief Executive, the Chief Financial
Ofcer, the Deputy Chief Financial Ofcer, the Group Financial
Reporting Director, the Group Audit Director, the Group Risk and
Compliance Director, and the Group General Counsel and Company
Secretary. The Committee also regularly meets separately with each
of PricewaterhouseCoopers LLP, the Chief Financial Ofcer and the
Group Audit Director without others being present.
In the year, the Board appointed an external company to perform
an independent review of the Committee which concluded that
the Board members considered the Committee to be fully effective
in meeting its objectives.
Financial reporting
The Committee’s primary responsibility in relation to the
Group’s nancial reporting is to review with both management and
the external auditor the appropriateness of the half-year and annual
nancial statements concentrating on, amongst other matters:
a the quality and acceptability of accounting policies and practices;
a material areas in which signicant judgements have been
applied or where signicant issues have been discussed with the
external auditor;
a the clarity of the disclosures and compliance with nancial reporting
standards and relevant nancial and governance reporting
requirements, including the 2014 UK Corporate Governance Code;
a any correspondence from regulators in relation to our nancial
reporting; and
a an assessment of whether the Annual Report, taken as a whole,
is fair, balanced and understandable and provides the information
necessary for shareholders to assess the Company’s position and
performance, business model and strategy. This assessment forms
the basis of the advice given to the Board to assist them in making the
statement required by the 2014 UK Corporate Governance Code.
Overview Strategy review Performance Governance Financials Additional information
Vodafone Group Plc
Annual Report 2016
47