[Page 4 of 4 ]

 

Remit

The responsibilities of the committee are set out in its Terms of Reference and briefly comprise:

• monitoring the integrity of the financial statements including critical accounting policies and practices;
• reviewing the effectiveness of systems in place for identifying and mitigating emerging risks facing the business;
• assessing the effectiveness of systems for internal control and reporting;
• reviewing procedures for detecting fraud and ensuring that adequate arrangements are in place by which staff may, in confidence, raise concerns about possible improprieties in matters of financial reporting, financial control or otherwise;
• monitoring the effectiveness of the internal audit function and the company's responsiveness to the internal auditor's findings and recommendations;
• reviewing the effectiveness and independence of the external auditors.

 

BBC Worldwide has implemented a policy to ensure that other services provided by the external auditors do not impair their objectivity and the Audit Committee monitors this on a regular basis. The policy sets out the value of non-audit services that can be provided and the types of service for which the external auditors would not be appropriate. All non-audit services provided by the external auditors greater than £50,000 must be pre-approved by the BBC Audit Committee. This approval limit is reviewed annually. The Group auditors are also appointed as auditors of subsidiary, joint venture and associate undertakings wherever possible.

Matters relating to BBC Worldwide are also considered by the BBC's Audit Committee.

Meetings

The Audit Committee met three times during the year under its revised constitution, with all members attending each meeting. The Chief Executive, Chief Financial Officer, Head of BBC Business Assurance, external auditors, risk management team and other Executive Board members attend by invitation as appropriate. Both internal audit and external audit functions have the opportunity to meet with the Audit Committee in the absence of executive management at least once a year and have the ability to do so at any other time they consider necessary.

REMUNERATION COMMITTEE

Composition, remit and meetings

The BBC Remuneration Committee has responsibility for setting the remuneration package for BBC Worldwide's Chief Executive. The Remuneration Committee of BBC Commercial Holdings Ltd, the parent company for the BBC's commercial subsidiaries, has responsibility for setting BBC Worldwide Board remuneration policy, including the remuneration packages for BBC Worldwide's other Executive Directors.

The BBC Commercial Holdings Remuneration Committee comprises Zarin Patel and Etienne de Viliers. The Committee met twice during the year with both members attending each meeting.

The Committee has made no significant changes in Directors' remuneration policy over the year, although a new Long-Term Incentive Plan has been developed for senior management to support the company's objective of delivering long-term growth.

The Chief Executive recommends the remuneration packages for the other Executive Directors, for approval by the Remuneration Committee. The Chief Executive assesses the performance of the Executive Directors before recommending their annual remuneration awards.

The Chief Executive, the Chief Financial Officer, the Director of Human Resources and the BBC's Head of Reward provided assistance to the Committee during the year. The Committee appointed none of these advisers.

Non-executive Directors

BBC Worldwide aims to remunerate its independent Nonexecutive Directors in line with fees paid by other organisations of a similar size and complexity. The Non-executive Directors are not eligible for bonuses, long-term incentive schemes, pensions or other performance-related remuneration. The BBC Non-executives, Jana Bennett, Zarin Patel and Nicholas Eldred do not receive remuneration from BBC Worldwide.

Executive Directors

The Company's policy is to provide remuneration and other benefits sufficient to attract, retain and motivate Board members of the experience and calibre required. Performance-related variable remuneration (bonus and incentive plans) is expected to comprise a significant proportion of remuneration.

INVESTMENT COMMITTEE

Composition, remit and meetings

The BBC Worldwide (Programme) Investment Committee's responsibilities included approval of programme and product investments of between £0.5 million and £2.0 million, ensuring that programme investment decisions are consistent with BBC Worldwide's overall strategy and appetite for risk and assessing Post Investment Reviews.

During the year the committee comprised four Board Directors - David King, Mark Young, Wayne Garvie and Darren Childs. Following Mark Young's resignation in May 2007, Chris Weller joined the committee. All Board members receive the agenda prior to each meeting and are able to attend as appropriate. The committee meets fortnightly, with at least two members required on each occasion.

Approval levels

Authority to approve investment and expenditure is documented in BBC Worldwide's Investment and Expenditure Approval Guidelines, which are available to all staff. Investments valued at over £2.0 million in total, and any other single decision that will result in a commitment to costs of over £0.5 million, must be pre-approved by the BBC Worldwide Executive Board. The limit of £0.5 million enables the majority of operational decisions to be approved by local management boards and for the committee to focus on more significant or contentious decisions.