John Ramsay (Chair)
The Committee consists of four Non-Executive Directors. John Ramsay joined the Board and became a member of the Audit Committee on 1 January 2020 and became Chair of the Committee on the retirement of Alan Ferguson on 23 April 2020. Having this time before becoming the Chair of the Committee allowed John not only to focus on his induction to the Board and the Group, it also afforded the time for a comprehensive and structured handover of the Audit Committee Chair responsibilities.
The experience of each member of the Committee is summarised on pages 54 and 55 of the 2020 Annual Report and Accounts. John has over 30 years' experience from an international finance background and extensive experience as an Audit Committee Chair. The Board considers each member of the Committee is independent within the definition of the Code, has relevant financial experience, as well as a broad and diverse spread of commercial experience, including competence in operating within the chemical industry. Such consideration provides the Board with assurance that the Committee has the appropriate skills and breadth and depth of experience to ensure that it can be fully effective, and that it meets the Code requirements that at least one member has significant, recent and relevant financial experience and that the Committee as a whole is competent in the sector in which the Company operates.
The Chair of the Board, Keith Layden (a Non-Executive Director), the Group Chief Executive, the Group Finance Director, the Group Financial Controller, the Vice President of Risk and Assurance, who leads the internal audit function, and representatives from the external and internal auditors attend the meetings by invitation.
The Committee periodically, and the Chair more regularly, meet or speak separately with the Vice President of Risk and Assurance and the internal and external auditors without the Executives being present. While these discussions are invaluable, the Chair also meets with the external auditors, the Group Finance Director and the Group Financial Controller at least twice each year but typically before each Audit Committee meeting to discuss control and compliance issues generally and specifically the detail of the year end and half year results, accounting judgements and disclosures. This helps the Chair to better understand the key issues, technical matters and judgements and to make sure sufficient time is devoted to them at the subsequent meeting.
The Committee assists the Board in ensuring that the Group’s financial systems provide accurate and up-to-date information on its financial position.
The Key Responsibilities of the Committee are to:
- To monitor the integrity of the financial statements and results announcements of the Group and to review significant financial reporting issues and judgements
- To recommend external auditor appointment and removal, assess audit quality, negotiate and approve the audit fee, assess independence, monitor non-audit services and be responsible for audit tendering
- To review the adequacy and effectiveness of the Group’s internal controls and risk management systems, and the adequacy, effectiveness and output of the internal audit function
- To review the adequacy of the Group’s whistleblowing arrangements and procedures for detecting fraud
Looking ahead to 2021
In addition to routine business, the Committee has four focus areas for 2021. The Committee will:
- Maintain our focus on cyber security with a refreshed rolling annual assurance programme based on the NIST security framework
- Monitor Avanti and Iberchem integration programmes, including controls assessment against Croda risk and control standards
- Review the major capital projects assurance programme
- Assess the impact of anticipated regulatory changes on Croda's risk and control framework