Georgia Healthcare Group PLC Annual Report 2018 Governance Audit Committee Report David Morrison Chairman of the Audit Committee Chairman’s Overview Key responsibilities On behalf of the Board, the Audit Committee encourages and Dear shareholders, seeks to safeguard high standards of integrity and conduct in financial reporting, internal control and (together with the Clinical For the financial year 2018, our Committee has: Quality and Safety Committee) risk management and internal • overseen the embedding of the new risk management audit. It also oversees the work of our external auditor. framework and reviewed reports from the Chief Risk Officer; • reviewed significant accounting policies and areas of significant The Committee reports to the Board on how it discharges judgement and any material assumptions, including a review its responsibilities and makes recommendations to the Board, of the implementation of new International Financial Reporting all of which have been accepted during the year. Standards (IFRS 9 and IFRS 16); • conducted an effectiveness evaluation of the External The Committee’s full Terms of Reference, which outline its Audit Process; primary roles and responsibilities, are available on our website at: • conducted the tender process for the provision of External http://ghg.com.ge/terms-of-references. Audit services; • reviewed EY’s External Audit plan for 2019 following the Composition and operations of the Audit Committee tender process; The composition of the Committee complies with the 2016 UK • reviewed the Internal Audit plan and the outcomes of Corporate Governance Code, which provides that the Committee internal audits; should comprise at least two Independent Non-Executive Directors. • reviewed the Company’s whistleblowing and anti-bribery The Board appoints the Chair of the Committee, who must be an and anti-corruption arrangements; independent Non-Executive Director. • reviewed the 2018 Annual Report and Accounts, including confirming that they were fair, balanced and understandable; The Audit Committee members and their meeting attendance for the • reviewed the half year results and the quarterly results; and year 2018 is set out in the Board and Committee meeting attendance • reviewed the viability and going concern statements; section on page 68. I wish to record the Committee’s gratitude to Dr Caroline Brown for The Board is satisfied that all members of the Audit Committee have the work she undertook for the Committee and the Company more recent and relevant financial experience and that the Audit Committee widely throughout 2018. Caroline’s role as an Advisor to the Board, as a whole has competence relevant to the sector in which the and as a member of the Committee, came to an end in December Company operates. As we reported in the 2017 Annual Report, the 2018 and we are very grateful to her for her valuable contribution Board appointed Dr Caroline Brown to serve as an advisor to the Board to the work of the Committee. and as a member of the Audit Committee effective as of 24 February 2018, succeeding Paul Goldfinch, who stepped down from the I now invite you to read more about our work in the following report. Committee at that time. Dr Caroline Brown is a Fellow of the Chartered Institute of Management Accountants and, like her predecessor Mr. Goldfinch, has deep experience of accountancy and audit. David Morrison Over 2018, the Committee has discussed how to take forward Chairman of the Audit Committee feedback from shareholders at the most recent Annual General 2 April 2019 Meeting in respect of the Committee’s composition, suggesting that the advisor role of Dr Brown was not a permanent solution. With that in mind, and changes to the UK Corporate Governance Code relating to the makeup of the Audit Committee, members recommended to the Board that the Committee terms of reference be amended with effect from 1 January 2019 to provide that the Committee be comprised solely of independent non-executive Directors. 76