DIPPED PRODUCTS PLC / ANNUAL REPORT 2008—2009

Audit Committee Report
Composition and role
The Audit Committee, appointed by and responsible to the Board of Directors, comprises three Non-Executive Directors. The
Chairman, Finance Director of Hayleys PLC and the Managing Director attend meetings of the Committee by invitation. The
Chairman of the Audit Committee is a senior Chartered Accountant. The role of the Committee, which has specific terms of
reference, is described in the Corporate Governance Report on page 35.
The names of the members and brief profiles of each member are given on pages 17 and inner back cover in this report. Their
individual and collective financial knowledge and business acumen and the independence of the Committee, are brought to bear
on their deliberations and judgments on matters that come within the Committee’s purview. Kelani Valley Plantations PLC the
other quoted company in the Group, that has independent non- executive directors constituted its own Audit Committee to
review their activities with effect from this financial year. Their terms of reference will be similar to the terms of the DPL Group
Audit Committee and reports from these committees will be forwarded to the DPL Group Audit Committee.
Meetings
The Audit Committee met 4 times during the year. The attendance of the members at these meetings is as follows:
Mr R Seevaratnam (Chairman) 4/4
Mr N B Weerasekera 4/4
Mr F Mohideen 1/1
Activities
The Committee carried out the following activities during the year:
the Committee reviewed the financial reporting system adopted by the Group in the preparation of its quarterly and
annual Financial Statements to ensure reliability of the process and consistency of the accounting policies and methods
adopted and their compliance with the Sri Lanka Accounting Standards. The methodology included obtaining statements
of compliance from Heads of Finance. The Committee recommended the Financial Statements to the Board for its
deliberations and issuance. The Committee, in its evaluation of the financial reporting system, also recognised the adequacy
of the content and quality of routine management information reports forwarded to its members.
the Committee reviewed the process to assess the effectiveness of the internal financial controls that have been
designed to provide reasonable assurance to the Directors that assets are safeguarded and that the financial reporting
system can be relied upon in preparation and presentation of the Financial Statements. The internal audit function of
local manufacturing companies is carried out by an independent firm of chartered accountants. Procedures relating to
continuous monitoring and reporting of key control elements in Group companies were brought to the notice of the
internal auditors and the Hayleys Group Management Audit & Systems Review Department in order to formulate the
action plans for the ensuing year.
the Committee obtained and reviewed statements on major Business Risks, mitigatory action taken or contemplated.
the Committee reviewed reports tabled by Group companies certifying their compliance with relevant revenue
regulations.
the Committee held meetings with the External Auditors to review the scope of the audit and the Audit Management
Letters of Group companies. Actions taken by the management in response to the issues raised, as well as the effectiveness
of the internal controls in place, were discussed. Remedial action was recommended wherever necessary.
the Committee reviewed the nature and value of non-audit work the External Auditors had undertaken, to ensure that it
did not compromise their independence. The Audit Committee has recommended to the Board of Directors that Messrs
KPMG Ford, Rhodes, Thornton & Co., be continued as Auditors for the financial year ending March 31,2010.
R Seevaratnam
Chairman
Audit Committee
May 6, 2009
38
D I P P E D P R O D U C T S P L C A N N U A L R E P O R T 2 0 0 8 – 2 0 0 9