Audit committee

John Warren
Chairman of the Audit committee

• Who is on the Audit committee?
• What is the role of the Audit committee?
• How does the Audit committee operate?
• Does the Audit committee review the performance of the external auditors?
• How frequently did the Audit committee meet during 2008?
• What activities did the Audit committee undertake during the year?
• Does the board evaluate the performance of the Audit committee?

Who is on the Audit committee?

During 2008, the committee comprised the following non-executive directors (all of whom are independent):

Date first appointed
John Warren (committee chairman since 27 April 2006)	01 Jan 06
Richard Greenhalgh	03 Mar 08
Owen O’Donnell	11 Sept 08
Bill Shannon	03 Apr 06

The board is satisfied that, taken as a whole, the committee has recent and relevant financial experience. Normally, the chairman, chief executive, finance director, company secretary and group financial controller attend committee meetings, as do representatives of the external auditors.

What is the role of the Audit committee?

In summary, the committee assists the board in reviewing the effectiveness of internal control systems, oversees the establishment, implementation and maintenance of the Company’s code of conduct and monitors the Group’s whistleblowing programme. The committee also reviews financial statements to be published externally before their submission to the board, in order to ensure that they present a fair assessment of the Group’s position and prospects. It also authorises any change in accounting policies. The Audit committee’s terms of reference are available on written request to the company secretary.

How does the Audit committee operate?

The committee meets at least three times a year and at least annually with the external auditors without management being present. The committee keeps under review the independence and objectivity of the external auditors and their effectiveness. In particular, the committee oversees the nature and amount of non-audit work undertaken by PricewaterhouseCoopers LLP each year to ensure that external auditor independence is safeguarded. All non-audit services above a value of £50,000 to be performed by the external auditors are required to be approved by the Audit committee in advance and the Group’s policy is that, where appropriate, non-audit work is put out to competitive tender.

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Does the Audit committee review the performance of the external auditors?

The committee reviews the effectiveness of the external audit process and the external auditors’ performance annually, taking into account the views of management, and feedback is provided to the auditors.

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How frequently did the Audit committee meet during 2008?

There were three meetings of the committee during the year under review

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What activities did the Audit committee undertake during the year?

In addition to more routine items of business, during 2008 the committee reviewed in detail the results of internal audits of Mecca Bingo clubs, which by the end of the year under review had improved. Additionally, the committee reviewed the risk identification, evaluation and management work that had been undertaken by the executive committee during the year. At two of its meetings during the year, the committee reviewed the work of management in relation to the identification of, and provision of assistance to, problem gamblers and reviewed the procedures in place for combating money laundering and internal fraud and theft.

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Does the board evaluate the performance of the Audit committee?

The Audit committee’s performance was evaluated through the completion of questionnaires. The results of this evaluation, which was carried out by the members of the committee and members of senior management who had dealings with the committee, were then reviewed by the board which concluded that the committee functions effectively.

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