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BOARD COMMITTEES<br />
The Company has preserved four board committees (“Board Committees”) with defined terms of reference (which<br />
are available upon written request to the Company Secretary) – Audit Committee, Compensation Committee,<br />
Strategy Committee and Governance Committee. The terms of reference of Audit Committee and Compensation<br />
Committee reference those set out in the CG Code prevailing from time to time.<br />
Should need arise, the Board will authorize an independent board committee comprising the independent nonexecutive<br />
directors to review, approve and monitor connected transactions (including continuing connected<br />
transactions) that should be approved by the Board.<br />
Minutes of committee meetings are circulated to members of the relevant Board Committees for comment and are<br />
open for inspection by any director.<br />
The following lists out the membership, responsibilities and the summary of work that each Board Committee<br />
performed on behalf of the Board during the financial year:<br />
Audit Committee<br />
Membership<br />
All members of the Audit Committee (defined as “Committee” in this section) are non-executive directors, the<br />
majority of which including the Committee Chairman are independent non-executive directors. The members<br />
during the year were Professor Woo Chia-Wei, Mr. Ting Lee Sen, Mr. John W. Barter III, Ms. Ma Xuezheng and<br />
Mr. Nicholas C. Allen. Mr. Barter resigned as Committee Chairman concurrent with his resignation as director<br />
of the Company effective on February 4, 2010. In substitute, Mr. Allen who was appointed a member of the<br />
Committee on November 6, 2009 was elected Committee Chairman with effect from February 4, 2010.<br />
The Committee members possess diversified industry experience and the Chairman has the accounting or<br />
related financial management expertise.<br />
Responsibilities and summary of work<br />
The Committee is responsible for assisting the Board in providing an independent review of the financial<br />
statements and internal control system. It acts in an advisory capacity and makes recommendations to the<br />
Board. The Committee meets with external auditor and management of the finance and internal audit functions of<br />
the Company at least four times a year at quarterly interval and is authorized to obtain independent professional<br />
advice to support its function. In each of these regular meetings, a separate executive session was arranged<br />
for the Committee to meet with external auditor, Internal Auditor and General Counsel in the absence of<br />
management to discuss matters relating to any issues arising from the audit and any other matters such persons<br />
would like to raise.<br />
The Committee met four times during the year and has performed the following duties:<br />
• Review of the accounting principles and practices adopted by the Group<br />
• Review of the financial reporting matters including the quarterly, interim and annual financial statements,<br />
announcements, interim report and annual report before submission to the Board for approval<br />
• Discussion of yearly internal audit plan of the Group and quarterly review of internal audit and business control<br />
• Discussion of yearly audit plan of the Group and review of quarterly external audit progress report<br />
• Review of enterprise risk management<br />
• Overview of group’s tax model<br />
• Review of non-audit services provided by external auditor<br />
• Review of continuing connected transactions of the Group<br />
• Recommendation on re-appointment of external auditor<br />
2009/10 Annual Report <strong>Lenovo</strong> Group Limited 33