Annual Report 2016 - Page 51

Annual Report 2016 South Staffordshire Water PLC’s approach to risk reflects its status as a regulated and licensed water undertaking providing an essential public service. As detailed above and in the Strategic Report, a strong risk management and control framework is in place to understand and manage identified risks. The non-regulated businesses operate principally in regulated environments and, as such, must also have strong risk control management. Risk management is discussed at Board level both in terms of the Group and its businesses on a regular basis. As detailed above, the Group’s individual businesses are required to monitor risk and its management with any significant changes in business risk and any subsequent procedures or controls to mitigate the risk being reported to the Audit Committee. Further details in respect of the Company’s risk management can be found in the Financial Review section of the Strategic Report on pages 37 and 38. External independent auditor The Board, assisted by the Audit Committee, reviews each year the external independent auditor’s performance, independence, effectiveness and fees including the level of non-audit services and fees. In evaluating the external independent auditor, the Audit Committee assesses the calibre of the external audit firm, the audit scope and plan which is agreed in advance with the Audit Committee and the level and nature of audit communications, including the reporting to the Audit Committee of the audit results. The responsibilities of the external independent auditor in the area of financial reporting are set out in their report in each year’s financial statements. Relations with shareholders The Board ensures that a regular and detailed dialogue with shareholders takes place. This is achieved through regular management and Board meetings that shareholders attend and through other less formal communication. Details in respect of the Company’s going concern can be found in the Long Term Viability statement presented on pages 38 and 39, and in the Directors’ Report on page 42. 49