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The Committee shall carry out the duties below

To ensure:

1. that due consideration is given to all laws and regulations, the provisions of the Code and published guidance (as amended from time to time), the requirements of the FCA’s Listing Rules, Prospectus Rules and Disclosure Guidance and Transparency Rules sourcebook and any other applicable rules, as appropriate;

2. that the external Auditor complies with relevant ethical and professional guidance on the rotation of audit partners, the level of fees paid by the Company compared to the overall fee income of the firm, office and partner and other related requirements;

3. that there are no relationships (such as family, employment, investment, financial or business) between the external Auditor and the Company (other than in the ordinary course of business);

4. the co-ordination of the activities of the internal and external Auditors;

5. that the Head of Internal Audit has the right of direct access to the Chair of the Board and to the Chair of the Committee;

6. the remit of the Internal Audit function is understood and ensure it has adequate resources and appropriate access to information to enable it to perform its function effectively and in accordance with the relevant professional standards;

7. that any activities within its Terms of Reference are investigated as necessary; and

8. that the Committee’s Terms of Reference are made publicly available;

To review

9. and challenge where necessary:

a. the application of significant accounting policies and any changes to them;

b. the methods used to account for significant or unusual transactions where different approaches are possible;

c. whether the Company has adopted appropriate accounting policies and made appropriate estimates and judgements, taking into account the external Auditor’s views on the financial statements;

d. the clarity of and completeness of the disclosures in the Company’s financial statements and the context in which statements are made; and,

e. all material information presented with the financial statements, including the strategic report and the corporate governance statements relating to the audit and risk management;

10. any other statements requiring Board approval which contain financial information first, where to carry out a review prior to Board approval would be practicable and consistent with any prompt reporting requirements under any law or regulation including the Listing Rules, Prospectus Rules and Disclosure Guidance and Transparency Rules sourcebook;

11. where requested by the Board, the content of the annual report and accounts and advise the Company’s Board on whether, taken as a whole, it is fair, balanced and understandable and provides the information necessary for shareholders to assess the company’s performance, business model and strategy, and whether it informs the Board’s statement in the annual report on these matters that is required under the Code;

12. the Company’s internal financial control systems that identify, assess, manage and monitor financial risks, and other internal control and risk
management systems;

13. annually, the external Auditor’s qualifications, expertise and resources, their independence and objectivity and the effectiveness of the external audit process, including a report from them on their own internal quality procedures taking into account relevant UK professional and regulatory requirements and also guidance from recognised bodies of good standing and the relationship with the external Auditor as a whole, including the provision of any non-audit services and the external Auditor’s compliance with applicable UK ethical guidance relating to the rotation of audit partners;

14. regularly with the external Auditor, including once without management present, once at the planning stage before the audit and once after the audit at the reporting stage to:

f. consider the annual audit plan and ensure that it is consistent with the scope of the audit engagement;

g. examine the findings of the audit with the external Auditor, which shall include but not be limited to the following:

(i) a discussion of any major issues which arose during the audit;

(ii) any accounting and audit judgements;

(iii) the levels of errors identified during the audit; and,

(iv) the appropriateness of management’s responsiveness to the findings and recommendations of the external Auditor;

h. assess the effectiveness of the audit;

i. and consider any representation letter(s) requested by the external Auditor before they are signed by management; and,

j. and consider the management letter and management’s response to the external Auditor’s findings and recommendations;

15. at least once a year, without the management being present (other than the Head of Internal Audit, where appropriate), their remit and any issues that have arisen out of the internal audits that have been carried out and:

k. assess the annual internal audit plan;

l. monitor the effectiveness of the Company’s internal audit function; and,

m. consider the ongoing need for an internal audit function and make recommendations to the Board thereafter, as appropriate;

16. promptly all reports on the Company from the internal auditors and monitor management’s responsiveness to the findings and recommendations of the Head of Internal Audit; and

17. at least annually the Committee’s Terms of Reference and the effectiveness of the Committee and to report to the Board in respect thereof, including any recommendations;

To monitor

18. the maintenance of a sound system of internal control and risk management; and

19. monitor and review the integrity of the financial statements of the Company, including its annual and interim reports, preliminary results announcements and any other formal announcement relating to its financial performance, particularly focusing upon:

a) any significant financial reporting issues;

b) any significant adjustments resulting from the audit; and,

c) the going concern assumption and major judgements which they contain.

To approve

20. the appointment and removal of the Head of Internal Audit;

21. approve and implement a policy on the engagement of the external Auditor to supply non-audit services ensuring there is prior approval of non-audit services, considering the impact this may have on independence taking into account the relevant regulatory and ethical guidance in this regard and reporting to the Board on any improvement or action required;

22. the Company’s arrangements and associated policy for colleagues to raise concerns, in confidence, about whistleblowing and possible improprieties in atters of financial reporting or other matters and ensure that such arrangements allow proportionate and independent investigation of such matters and appropriate follow up action;

23. the Company’s systems and controls for the prevention of bribery and corruption, including the policy and receipt of any reports on non-compliance;

24. the Group Tax Policy and Group Treasury Policy, including foreign currency and interest rate exposure;

25. any significant changes in accounting policies or practice and recommend these to the Board;

26. in annual and half-yearly financial statements, the Committee should exercise judgement in deciding which of the issues it considers in relation to the financial statement are significant, but should include at least those matters that have informed the Board’s assessment of whether the Company is a going concern and the inputs to the Board’s viability statement ; and

27. a statement for inclusion in the Annual Report describing the work of the Audit Committee, and to recommend this statement to the Board for its approval. The statement should include the following:

a. an explanation in the Annual Report, taking into account of the Company’s current position and principal risks, how it has assessed the prospects of the Company, over what period it has done so and why it considers that period to be appropriate. The statement should also set out whether the Board has a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the period of their assessment, drawing attention to any qualifications or assumptions as necessary;

b. a report on the frequency of attendance by members of meeting;

c. the significant issues that the Committee considered in relation to the financial statements, and how these issues were addressed;

d. confirmation that the Committee has completed its assessment of the Company’s emerging and principal risks, what procedures are in place
to identify emerging risks, and an explanation of how these are being managed or mitigated;

e. an explanation of how the Committee has assessed the independence and effectiveness of the external audit process and the approach taken to the appointment or reappointment of the External Auditor, information on the length of tenure of the current audit firm, when a tender was last conducted and the reasons why the Board has taken a different position; and,

f. if the external Auditor’s provide non-audit services, an explanation of how auditor objectivity and independence is safeguarded.