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Audit Committee

Members

Colin Maitland (Chairman)
Graham Cole (Non Executive Director)

The following are the terms of reference of the Audit Committee (“the Audit Committee”) of Ashton Penney Holdings plc.

1.1. The Committee shall be appointed by the Board. The Committee shall be made up of two members.
1.2. Both members of the Committee shall be independent non-executive directors.
1.3. Only members of the Committee have the right to attend Committee meetings. However, other individuals such as the Chief Executive, Finance Director, other executive directors, the Company Secretary, representatives from the external auditors and representatives from the finance function may be invited to attend all or part of any meeting as and when appropriate.
1.4. Appointments to the Committee shall be for a period of up to three years, which may be extended for a further two three-year periods, provided the director remains independent.
1.5. The Board shall appoint the Committee Chairman who may be the Chairman of the Board or another, independent, non-executive director.

2.1. The Company Secretary or their nominee shall act as the Secretary of the Committee.

4.1. The Committee shall meet prior to publication of the preliminary and interim results of the Company and at such other times, as the Chairman of the Committee shall require. At least once a year the Committee shall meet the auditors without management being present.

5.1. The Secretary of the Committee shall convene meetings at the request of the Chairman of the Committee and circulate an agenda and other papers to be considered at least three working days in advance of the meeting, or at the request of the auditors if they consider it necessary.

6.1. The Secretary shall circulate minutes of meetings to all members of the Board after they have been agreed by the Committee. The Chairman of the Committee shall report orally to the Board on meetings of the Committee as necessary.
6.2. The Committee’s Terms of Reference will be made available upon request.
6.3. The Committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed.

7.1. The Chairman of the Committee shall attend the Annual General Meeting prepared to respond to any shareholder questions on the Committee’s activities.

8.1.1. The Committee shall monitor the integrity of the Company’s financial statements, including its Annual Report and Accounts, Interim Accounts, Summary Financial Statement, the full year and half year stock exchange announcements and any other formal announcement relating to its financial performance, reviewing significant financial reporting issues and judgements which they contain.
8.1.2. The Committee shall review and challenge where necessary the actions and judgements of management in relation to the interim and annual financial statements before submission to the Board, paying particular attention to:

8.1.2.1. critical accounting policies and practices, and any changes in them;
8.1.2.2. decisions requiring a major element of judgement;
8.1.2.3. the extent to which the financial statements are affected by any unusual transactions in the period and how they are disclosed;
8.1.2.4. the clarity of disclosures;
8.1.2.5. the significant adjustments resulting from the audit;
8.1.2.6. the going concern assumption; and
8.1.2.7. compliance with accounting standards.

8.2.1. The Committee shall monitor and keep under review the effectiveness of the Company’s internal controls and risk management system.
8.2.2. The Committee shall review the statements to be included in the Annual Report concerning internal controls and risk management.

The Committee shall review the Company’s arrangements for its employees to raise concerns, in confidence, about possible wrongdoing in financial reporting or other matters. The Committee shall ensure that these arrangements allow proportionate and independent investigation of such matters and appropriate follow up action.

8.4.1. The Committee shall consider and make recommendations to the Board to be put to shareholders for approval at the AGM in relation to the appointment, re-appointment and removal of the auditors.
8.4.2. The Finance Director is responsible for the overall day to day relationship with the auditors. The Committee shall oversee the relationship with the auditors including (but not limited to):

8.4.2.1. approval of audit fees and any other fees payable to auditors and, their relative significance to the auditors' business;
8.4.2.2. approval of their terms of engagement, including any engagement letter issued at the start of each audit and review the effectiveness of the audit; and
8.4.2.3. an annual assessment of the independence and objectivity of the auditors, the scope of any disclosed relationships or services, the appropriateness of partner rotation practices and take appropriate action to ensure the continuing independence of the auditors.
8.4.2.4. obtaining an annual report from the auditors on their own internal quality procedures.
In each case taking into consideration relevant UK professional and regulatory requirements.

8.4.3. The Committee shall review the findings of the audit with the auditor and review any representation letter(s) requested by the auditor before management signs them.
8.4.4 The Committee shall meet the auditor at least once a year, in management's absence, to discuss their remit and any concerns they may have.

9.1 Subject to any restrictions imposed by law, the Committee is authorised to seek any information it requires from any employee of the Company in order to perform its duties and all employees are directed to cooperate with any request made by the Committee.
9.2 The Committee is authorised to obtain, at the Company’s expense, outside legal, financial or other professional advice, when it reasonably believes it necessary to do so, on any matter within these terms of reference.