Tesco 2014 Annual Report Download - page 38

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Training
The Committee continually assesses the need for training and the
annual agenda provides substantial time for technical updates which
are generally provided by external experts. During the year, training
was provided on corporate governance developments and accounting
and tax developments. Training is also provided on an ongoing basis
to meet the specific needs of individual Committee members.
Internal and External Audit
It is essential for the Committee to be able to have an honest
and open relationship with both its external and internal auditors.
This relationship is developed and maintained through regular
private meetings with both PwC and the Head of Internal Audit.
Further information regarding the roles of both Internal Audit
and External Audit can be found below.
Internal Audit
The Internal Audit function is independent of business operations
and has a Group-wide mandate. It undertakes a continuous
programme to review the internal control and risk management
processes with particular reference to the Code. It operates a
risk-based methodology, ensuring that the Group’s key risks receive
appropriate examination each year. Its responsibilities include:
•Maintaining the Group Key Risk Register
•Facilitating oversight of risk management arrangements
across the Group through structured reviews with senior
management teams in the UK, Europe and Asia covering
our operating businesses and joint ventures
•Using the results of these reviews to assist the Executive
Committee to refresh and update the Group Key Risk Register
•Reviewing and reporting on the effectiveness of risk
management systems and internal controls to senior
management, the Executive Committee, the Audit
Committee and ultimately to the Board
External Audit
The Company’s external auditor PricewaterhouseCoopers LLP
(‘PwC’) contribute a further independent perspective on certain
aspects of the Company’s financial control systems arising from
its work, and report both to the Board and the Audit Committee.
PwC have served as the Company’s auditor since 1983 and the last
audit tender was carried out in that year. The partner engaged on
the audit is changed regularly. The current partner is due to rotate
after the year ended February 2017. The Audit Committee keeps
under review the ongoing legislative proposals on audit tendering
and rotation from the EU and the Competition Commission, now
the Competition and Markets Authority, and will implement them
in accordance with the suggested timescales.
The engagement and independence of PwC is considered annually
by the Audit Committee before it recommends its selection to the
Board. The Committee is satisfied that PwC remain independent
and are best placed to conduct the Company’s audit for 2014/2015.
The Committee therefore recommends that PwC be reappointed
as auditors.
The Company has a Non-audit Service Policy for work carried out
by PwC. This is split into three categories as explained below:
•Pre-approved work for external auditors – this is predominantly
the audit of subsidiary undertakings’ statutory accounts and is
audit-related in nature
•Work for which Committee approval is specifically required –
this includes transaction work and corporate tax services, and
certain advisory services
•Work from which the external auditor is prohibited
Other information
Governance Financial statementsStrategic report
Tesco PLC Annual Report and Financial Statements 2014 35