108 JUST GROUP PLC Annual Report and Accounts 2019
INDEPENDENT AUDITOR’S REPORT CONTINUED
company, was performed by the Group and component teams based at the Company’s offices in London and Reigate. The work on 4 of the 5 components (2018: 6 of the 7 components) was performed by component auditors and the rest, including the audit of the parent company, was performed by the Group team. The group team performed procedures on the items excluded from normalised group profit before tax. Meetings were held with these component auditors. At these meetings, the findings reported to the Group teamwere discussed in more detail, and any further work required by the Group teamwas then performed by the component auditor.
4. OUR APPLICATION OF MATERIALITY AND AN OVERVIEW OF THE SCOPE OF OUR AUDIT Materiality for the group financial statements as a whole was set at £6.7 million (2018: £6.7 million) determined with reference to a benchmark of group IFRS profit before tax, normalised to exclude the effects of short-term investment fluctuations and economic changes (as disclosed under note 6 – Investment and economic profits/(losses)), of which it represents 4.4% (2018: 4%). Materiality for the parent company financial statements as a whole was set at £2 million (2018: £6 million), determined by reference to company net assets, of which it represents 0.15% (2018: 0.6%). We agreed to report to the Audit Committee any corrected or uncorrected identified misstatements exceeding £0.34 million (2018: £0.34 million), in addition to other identified misstatements below that threshold that warranted reporting on qualitative grounds. Of the group’s 27 (2018: 27) reporting components, we subjected 5 (2018: 7) to full scope audits for group purposes. For the residual components, we performed analysis at an aggregated group level to re-examine our assessment that there were no significant risks of material misstatements within these. The Group team instructed component auditors as to the significant areas to be covered, including the relevant risks detailed above and the information to be reported back. The group audit team approved component materiality, which was set between £2 million and £6 million (31 December 2018: between £2 million and £6 million), having regard to the mix of size and risk profile of the Group across the components. The work on 5 (2018: 7) components, including the audit of the parent The components within the scope of our work accounted for the percentages illustrated opposite.
Normalised Group IFRS profit before tax £194.8m (2018: Group net assets: £166.5m)
Group materiality £6.7m (2018: £6.7m) £6.7m Whole financial
statements materiality (2018: £6.7m)
Range of materiality at 7 components (£2m – £6m) (2018: £2m – £6m)
£0.34m Misstatements reported to the Audit Committee (2018: £0.34m)
Normalised Group IFRS profit before tax Group materiality
Group revenue
Group profit before tax
Group total assets
98% (2018: 99%)
99% (2018: 93%)
97% (2018: 94%)
Full scope for Group audit purposes 2018 Residual components Full scope for Group audit purposes 2019
99% 98%
93% 99%
94% 97%
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