Just Annual Report and Accounts 2022

Just group PLC | Annual Report and accounts 2022

GROUP AUDIT COMMITTEE REPORT continued

Safeguarding independence and non-audit services The independence of the external auditor is essential to the provision of an objective opinion on the true and fair view presented in the financial statements. Auditor independence and objectivity are safeguarded by various control measures, including limiting the nature and value of non-audit services performed by the external auditor and partner rotation at least every five years. The Group has a policy in relation to the provision of non-audit services by our external auditor. All non-audit services provided by the external auditor are subject to review and approval by the Committee. The policy ensures that the Group benefits from the cumulative knowledge and experience of its external auditor while also ensuring that it maintains the same degree of objectivity and independence. During the year, the value of audit services to the Group was £3.7m (2021: £2.4m). The value of non-audit services during the year amounted to £0.7m (2021: £0.7m), comprising:

RISK MANAGEMENT AND INTERNAL CONTROL The Committee has responsibility to keep under review the system of internal financial controls that identify, assess, manage and monitor financial risks and other internal controls. In doing so the Group operates a three lines of defence model. The first line of defence is line management who devise and operate the controls over the business. The second line functions are Risk Management, Group Compliance and Actuarial Assurance, which oversee the first line, ensure that the systems of internal controls are sufficient and are operated appropriately, and measure and report on risk to the GRCC. The third line is Internal Audit, who provide independent assurance to the Board and its committees that the first and second lines are operating appropriately. The Group’s internal control systems comprise the following key features: • clear and detailed matters reserved for the Board and terms of reference for each of its committees; • a clear organisational structure, with documented delegation of authority from the Board to senior management; • a Group policy framework, which sets out risk management and control standards for the Group’s operations; • defined procedures for the approval of major transactions and capital allocation; and • a Group Internal Audit function that provides independent and objective assurance on the effectiveness of the Group’s risk management, governance and internal control processes. The Group has specific internal mechanisms that govern the financial reporting process and the disclosure controls and procedures around the approval of the Group’s financial statements. The results of the financial disclosure process are reported to the Committee to provide assurance that the Annual Report and Accounts is fair, balanced, and understandable, including the opportunity to challenge members of management and the external auditor on the robustness of those processes. It is the view of the Committee that the Group’s system of risk management and internal controls is currently appropriate to the Group’s needs.

£m

Audit-related assurance services (audit of regulatory returns)

0.5 0.2

Audit-related assurance services (other services)

Other assurance services

–

The ratio of non-audit services to audit services fees was 1:5:3. Non-audit services of £0.5m were provided during 2022 in relation to the audit of the Group’s Solvency II regulatory returns and a further £0.2m of non-audit services were provided in relation to the review of the Group’s interim report. Non-audit services for 2022 were similar to the previous year. These non-audit services are considered to be closely related to the work performed by the external auditor of the Group and the Committee determined that the services provided would not impact the independence of the external auditor. As part of the evaluation of the objectivity and independence of the external auditor, the Committee has received and reviewed written confirmation that PwC has performed their own assessment of independence within the meaning of all UK regulatory and professional requirements and of the objectivity of the audit engagement partner and audit staff and have also concluded that the independence is not impaired by the nature of the non-audit engagements undertaken during the year, the level of non-audit fees charged or any other facts or circumstances. The level of non-audit services offered reflects the external auditor’s knowledge and understanding of the Group. The Group has also appointed other accountancy firms to provide certain non-audit services in connection with internal audit, governance, tax and regulatory advice, and with regard to the implementation of IFRS 17. An analysis of auditor remuneration is shown in note 4 to the consolidated financial statements. The Committee has approved PwC’s remuneration and terms of engagement for 2022 and remains satisfied with the audit quality and that PwC continues to remain independent and objective.