Annual Report and Accounts 2007/08

• Business & operating review
• Financial review
• Corporate social responsibility
• Corporate governance
  • Good governance and the Code of Best Practice
  • The Board of Directors
  • Board committees
  • Internal control
  • Appointment of auditors to non-audit engagements
  • Statement of Directors' responsibilities
  • Relations with shareholders
• Board of Directors

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Directors’ report

Corporate governance

Appointment of auditors to non-audit engagements

The Company’s external auditors are currently PricewaterhouseCoopers LLP (PwC), who were appointed in 2006. The Company’s auditors are re-appointed at the Annual General Meeting each year and their appointment is reviewed on a regular basis. If the Board feels it is appropriate, the audit process is put out to tender and other audit firms are then invited to tender for the audit. The selection of new auditors is then done via a strict and rigorous process.

The Board is aware of the need to maintain an appropriate degree of independence on the part of the auditors when engaged on non-audit assignments.

Non-audit assignments are categorised in three ways:

• Auditor Preferred Services – those engagements where there would be a loss of shareholder value if the auditors did not carry out the work
• Auditor Restricted Services – those engagements which the Audit Committee does not consider appropriate for the auditors to undertake
• Auditor Authorised Services – those engagements where it may or may not be appropriate to engage the auditors.

The appointment of the auditors to any assignments falling within the Auditor Authorised Services category requires prior approval of the Audit Committee. In the category of Auditor Restricted Services, an appropriate third party is selected by senior management, taking into account price and relevant experience.

The proportion by value of non-audit services provided by the auditors during the year was 32 per cent. At each meeting, the Audit Committee reviews the services being provided and secures the auditors’ confirmation that such services have not compromised, and are not expected to compromise, their professional independence.