WYG

The Board is responsible for reviewing and approving the adequacy and effectiveness of the Group's internal controls, including financial, operational and compliance controls and risk management. The system of controls is designed to facilitate the efficient and effective operation of the Group.

The directors are ultimately responsible for the system of internal control within the business. Such a system is designed to manage rather than absolutely eliminate the risk of material misstatement or loss.

The framework of the Group's system of internal control includes:

• an annual review of all business risks affecting the Group which also identifies procedures to manage and mitigate such risks. These risks are monitored and updated on a quarterly basis;
• a Group organisation structure with clearly designated responsibilities and levels of authority;
• a comprehensive budgeting and financial reporting system with an annual business plan approved by the Board. Operating results, cash flow, working capital levels and future workload are reported monthly. This data is reviewed and assessed by reference to ratios and internal targets;
• a standard set of contractual terms and conditions for all grades of staff within the Group;
• financial accounting and management information systems utilised throughout the Group to maximise efficiency and control; and
• a clearly defined hierarchy for the monitoring of submissions of offers on major projects. This includes detailed appraisal and specific levels of authority to ensure all significant proposals are approved at the highest level.

The Board has considered the need for a separate internal audit function and considers it not to be necessary given that the existing Quality Assurance function provides an appropriate method of monitoring the established systems across the Group. This decision is reviewed annually.