Annual Report for the year ended 31 December 2008

The Committee observed that during the year the internal control
framework continued to provide reasonable assurances that appropriate
internal controls are in place or are further strengthened where it was
identified that potential risks or weaker controls existed. A formal review
of all risk incidents takes place to ensure that additional mitigating
actions that have been identified are implemented. These, along with
Key Risk indicators, are reviewed by the Risk Committee and included
within the monthly risk report to the Board.
The Committee reported that, save for the matters identified above
relating to Williams de Broë limited, risks are adequately managed and
mitigated through the system of internal controls and that there were
no further material failings or weaknesses in the Group’s internal control
system during the period under review. Therefore, the Board confirms
that throughout the year ended 31 December 2008 and up to the
approval date of the Financial statements, there has been an on-going
process of identifying, evaluating and managing the significant risks
faced by the Group and that the Group has complied with the Turnbull
Committee’s guidance for Directors.
Committee Performance
Committee performance is reviewed as follows:
• The Audit and Remuneration Committees are subject to a rigorous
review by their own members. Each member completes a questionnaire
to assess the effectiveness of the relevant Committee. The results for
the 2008 annual review are collated by the Company secretary and
reviewed by the relevant Committee at the subsequent Audit Committee
meeting. The Chairman of the relevant Committee is responsible for
leading a discussion on the results at the subsequent Board meeting.
Both Committees are considered to be working effectively.
• The Nomination Committee is subject to a rigorous review by its own
members and is considered to be working effectively.
The following committees deal with the specific aspects of the Group's affairs:
Audit Committee
The Audit Committee is comprised of three independent Non-executive
Directors. Nicholas irens acts as Chairman of the Audit Committee, with
lord Maclaurin and Mark Nicholls as members. Attendance at Committee
meetings is set out on page 24. The biographies on pages 16 to 17 set
out the qualifications of all the members of the Committee during the
year. Nicholas irens, as a Chartered Accountant with recent and relevant
financial experience, was considered by the Nomination Committee to
be appropriate for the role of Chairman of the Audit Committee.
The Audit Committee met on five occasions during the course of 2008.
The Group's auditors and the Executive Directors may attend Committee
meetings by invitation. The Committee has a discussion with the
external auditors at each Audit Committee meeting. The discussions
take place without Executive Directors being present, to ensure that
there are no unresolved issues of concern.
The Terms of Reference for the Committee comply with the Combined
Code and are available for inspection at the Company's registered office
and at the Annual General Meeting. A summary of these Terms is on the
Group’s website: www.evgplc.com. in accordance with the Combined
Code, the Audit Committee's remit, which is set out in its Terms of
Reference, includes responsibility for:
• monitoring the integrity of the Financial statements and formal
announcements of financial performance and reviewing significant
financial reporting judgements contained therein;
• reviewing related information presented within the Financial
statements, including the Financial Review, and Corporate
Governance Reports relating to risk management and audit, and
reviewing other statements containing financial information prior to
Board approval;
• reviewing the scope and findings of the external audit at the interim
and final stages;
• reporting to the Board any identified matters requiring action or
improvement and recommendations of steps to be taken;
• reviewing the effectiveness of the Group's internal financial control
procedures, and internal control and risk management systems,
reviewing any reports on the effectiveness of systems and conclusions
of any testing carried out by external auditors;
• reviewing arrangements by which staff of the Group may, in
confidence, raise concerns about possible improprieties in matters of
financial reporting or other matters and ensure arrangements are in
place for the proportionate and independent investigation of such
matters and for appropriate follow-up action;
• making recommendations to the Board for shareholder approval
of the appointment, re-appointment and removal of the external
auditors, external auditors’ remuneration and terms of engagement.
The Audit Committee has primary responsibility for these
recommendations; and
• reviewing and approving the annual internal audit plan, considering
reports and recommendations presented by the internal audit function
on processes, systems and controls and monitoring the implementation
of internal audit recommendations by management.
The Audit Committee has primary responsibility for:
• reviewing on an annual basis external auditor’s independence,
objectivity and the effectiveness of the audit process taking into
consideration relevant uK professional and regulatory requirements;
• developing and implementing policy on the engagement of the
external auditors to supply non-audit services and reporting to the
Board and, identifying any matters which require action or
improvement;
• considering the major findings of any internal investigations and
management’s response; and
• monitoring and reviewing the effectiveness of the internal audit function.
Remuneration Committee
The Remuneration Committee comprises all the independent Nonexecutive
Directors. lord Maclaurin acted as Chairman until 29 May
2008 when peter Gibbs was appointed Chairman in his place. lord
Maclaurin continues to make a valuable contribution to the work of the
Committee. Martin Gray, Nicholas irens and Mark Nicholls were also
members of the Committee. Attendance at Committee meetings is set
out on page 24.
The Remuneration Committee met twelve times during 2008 as part of
the continuing review of the Group’s remuneration and reward structure,
which had been prolonged due to the need to fully consider various
guidelines and codes of practice issued by the Financial services Authority
which at the date of this report were under review and in order to comply
with the requirements of the various share incentive plans. The Executive
We have made very good progress
WiTh The inTegraTion and developmenT
of each of our businesses.
27