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Integrated annual report 2011 to the shareholders of Phuthuma Nathi Investments Limited

MultiChoice South Africa Holdings (Proprietary) Limited
Report of the audit committee

for the year ended 31 March 2011

 

The audit committee has pleasure in submitting this report, as required by sections 269A and 270A of the Companies Act No 61 of 1973, as amended (“the Act”).

Functions of the audit committee

The audit committee has adopted formal terms of reference, delegated to it by the board of directors, as its audit committee charter.

The audit committee has discharged the functions in terms of its charter and ascribed to it in terms of the act as follows:
  • Reviewed the year-end financial statements, culminating in a recommendation to the board to adopt them. In the course of its review the committee:
    • took appropriate steps to ensure the financial statements were prepared in accordance with International Financial Reporting Standards (IFRS) and in the manner required by the Act
    • considered and, when appropriate, made recommendations on internal financial controls
    • dealt with concerns or complaints relating to accounting policies, internal audit, the auditing or content of annual financial statements and internal financial controls, and
    • reviewed legal matters that could have a significant impact on the organisation’s financial statements.
  • Reviewed external audit reports on the annual financial statements.
  • Approved the internal audit charter for recommendation to the board.
  • Approved the internal audit plan and budget.
  • Reviewed the internal audit and risk management reports and, where relevant, recommendations being made to the board.
  • Evaluated the effectiveness of risk management, controls and governance processes.
  • Verified the independence of the external auditor and nominated PricewaterhouseCoopers Inc. as auditor for 2011 and noted the appointment of Mr K J Dikana as the designated auditor.
  • Approved audit fees and engagement terms of the external auditor.
  • Determined the nature and extent of allowable non-audit services and approved contract terms for provision of non-audit services by the external auditor.

Members of the audit committee and attendance at meetings

The audit committee consists of the non-executive directors listed below and meets at least three times per annum in accordance with the charter. All members act independently as described in section 269A of the Act. During the year under review four meetings were held. Details of attendance can be found here.

  Name of
committee member
    Qualifications
  D G Eriksson     Chartered Accountant(SA)
  F G Sampson     Bachelor of Science Bachelor of Business Management and Administration with Honours Master of Business Management and Administration
  S Dakile-Hlongwane*     Bachelor of Economics and Statistics Master of Development Economics
*Appointed with effect from 11 August 2010

All committee members, with the exception of Mrs S Dakile-Hlongwane who was appointed with effect from 11 August 2010, served on the committee for the full financial year.

Internal audit

The audit committee fulfils an oversight role on the group’s financial statements and the reporting process, including the system of internal financial control. It is responsible for ensuring the internal audit function is independent and has the necessary resources, standing and authority in the organisation to enable it to discharge its duties. Furthermore the committee oversees cooperation between the internal and external auditors and serves as a link between the board of directors and these functions.

Attendance

The internal and external auditors, in their capacity as auditors to the group, attended and reported at all meetings of the audit committee. The risk management function was also represented. Executive directors and relevant senior managers attended meetings by invitation.

Confidential meetings

Audit committee agendas provide for confidential meetings between committee members and the internal and external auditors.

Independence of external auditor

During the year under review the audit committee reviewed a representation by the external auditor and, after conducting its own review, confirmed the independence of the auditor.

Expertise and experience of finance function

The committee satisfied itself that the composition, experience and skills set of the finance function met the group’s requirements.

Discharge of responsibilities

The committee determined that during the financial year under review it had discharged its legal and other responsibilities as outlined in terms of its remit, details of which are included here. The board concurred with this assessment.

D G Eriksson
Chair: Audit committee

2 June 2011