Governance
Financial Statements
Additional Information
Strategic Report
The key area of judgement that the Committee considered in reviewing the financial statements was the valuation of the Group’s investment properties. The valuation is conducted on a quarterly basis by external valuers and is subject to oversight by the Property Valuation Committee. It is a key component of the annual and half-year financial statements and is inherently subjective, requiring significant judgement. Members of the Property Valuation Committee, together with members of the Picton team, meet with the external valuer on a quarterly basis to review the valuations and underlying assumptions, including the year- end valuation process. The Chair of the Property Valuation Committee reported to the Audit and Risk Committee at its meeting on 30 April 2024 and confirmed that the following matters had been considered in discussions with the external valuers:
The Committee was satisfied that the 2024 Annual Report is fair, balanced and understandable. Mark Batten Chair of the Audit and Risk Committee
Activity The Audit and Risk Committee met four times during the year ended 31 March 2024 and considered the following matters: / External audit strategy and plan; / Audit and accounting issues of significance; / The Annual and Interim Reports of the Group; / Reports from the external auditor; / The effectiveness of the audit process and the independence of KPMG Channel Islands Limited; / Review of the Group’s Risk Management Policy and appetite; / Review of the risk matrix and mitigating controls; / Internal audit reports and programme; and / Stock Exchange announcements. Financial reporting and significant reporting matters The Committee considers all financial information published in the annual and half-year financial statements and considers accounting policies adopted by the Group, presentation and disclosure of the financial information and the key judgements made by management in preparing the financial statements. The Directors are responsible for preparing the Annual Report. At the request of the Board, the Committee considered whether the 2024 Annual Report was fair, balanced and understandable and whether it provided the necessary information for shareholders to assess the Group’s strategy, business model and performance.
Meetings of the Audit and Risk Committee are attended by the Group’s Finance Director and other members of the finance team, the internal auditor and the external auditor. The external auditor is given the opportunity to discuss matters without management present. Terms of reference The Committee’s terms of reference include consideration of the following issues: / Financial reporting, including significant accounting judgements and accounting policies; / Development of a comprehensive Risk Management Policy for the adoption by the Group; / Evaluation of the Group’s risk profile and risk appetite, and whether these are aligned with its investment objectives; / Ensuring that key risks, including climate-related risks, are being effectively identified, measured, managed, mitigated and reported; / Internal controls, controls testing and risk management systems; / The Group’s relationship with the external auditor, including effectiveness and independence; / Internal audit and assurance services, including review of any report and assessment of control weaknesses; and / Reporting responsibilities. Visit our website picton.co.uk
/ Property market conditions; / Yields on properties within the portfolio;
/ Letting activity and vacant properties; / Covenant strength and lease lengths; / Estimated rental values; and / Comparable market evidence. The Audit and Risk Committee reviewed the report from the Chair of the Property Valuation Committee, including the assumptions applied to the valuation and considered their appropriateness, as well as considering current market trends and conditions, and valuation movements compared to previous quarters. The Committee considered the valuation and agreed that this was appropriate for the financial statements. The external auditor has presented their findings to the Committee; no areas of concern were raised in respect of management judgements exercised in the preparation of the financial statements or matters that needed additional work.
Picton Property Income Limited / Annual Report 2024
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