Annual integrated report 2018

Audit and risk committee report This is the report of the audit and risk committee (committee) of Bidcorp appointed for the year ended June 30 2018 in compliance with the Companies Act and in terms of the JSE Listings Requirements. The committee has discharged its responsibilities as mandated by the board, its statutory duties in compliance with the Companies Act and the King IV principles applicable to audit and risk committees. The committee’s charter, which can be found on the company’s website, www.bidcorpgroup.com , is aligned with the above legislation, regulations and principles. Under the single chairmanship of Ms H Wiseman for group and divisional audit and risk committees, the board is satisfied that this committee makes a strong contribution to the group. Membership The committee members for the year ended June 30 2018 have been appointed by shareholders’ resolution passed at the annual general meeting held on November 9 2017; and is made up of a minimum of three independent non-executive directors, and chaired by an independent non- executive. The committee members comprise Ms H Wiseman (chairman), Messrs PC Baloyi and NG Payne in line with the charter requirements. The shareholders will be requested to approve the appointment of the chairman and members to the committee for the 2019 financial year at the annual general meeting scheduled for Tuesday, November 27 2018. The committee consists solely of independent non-executive directors who are all financially literate. The board considers the membership of the committee adequate and the members are sufficiently experienced to perform the duties in line with the charter requirements. The committee and its chairman are assessed annually. A brief profile of each of the members can be viewed on the board of directors’ CVs included on the company’s website. Attendance The committee met on eight occasions during the period under review and key members of management attend meetings of the committee by invitation. During the period, closed sessions were also held for committee members only, as well as with internal audit, external audit, risk, finance and management. Director August 18 2017 September 19 2017* September 26 2017* November 7 2017 February 16 2018 April 24 2018* May 11 2018 August 17 2018 H Wiseman (Chairman) ^ ^ ^ ^ ^ ^ ^ ^ PC Baloyi A ^ ^ ^ ^ ^ ^ ^ NG Payne ^ ^ ^ ^ ^ A ^ ^ ^ Attended in person, by video-conference or tele-conference. A Apologies * Special audit and risk committee meetings were called; inviting all board members to attend; in order to discuss matters relating to the external auditors, KPMG Inc. Purpose The purpose of the committee is to: • assist the board in discharging its duties relating to the safeguarding of assets, the operation of adequate systems, control and reporting processes, and the preparation of accurate reporting and financial statements in compliance with the applicable legal requirements and accounting standards; • oversee the activities of, and to ensure coordination between, the activities of internal and external audit; • provide a forum for discussing financial, enterprise-wide, market, regulatory, safety and other risks and control issues, and to monitor controls designed to minimise these risks; • review the Bidcorp annual integrated report in conjunction with the social and ethics committee, including the consolidated and separate financial statements, as well as its interim report and any other public reports or announcements containing financial information; • receive and deal with any complaints concerning the accounting practices, internal audit or the content and audit of its financial statements or related matters; and • annually review the committee’s work and charter to make recommendations to the board to ensure its effectiveness. Duties carried out The committee has successfully performed its duties during the financial year. In the fulfilment of these duties, the major areas of focus were revenue recognition, recoverability of trade receivables, valuation of inventory, customer discounts and supplier rebates, carrying value of goodwill, intangibles and investments, assets held for sale and discontinued operations, as well as other matters requiring significant judgement. The committee assessed risks associated with management override of controls, the ability of the group to continue as a going concern, review of related-party transactions, the overall presentation of the financial information to shareholders and review of the annual integrated report. The committee reviewed the material risks which could materially impact the ability of the group to deliver against its objectives and the related mitigation plans and considered these appropriate. 67 Bid Corporation Limited Annual integrated report 2018 This is Bidcorp ifc – 13 Leadership review 14 – 23 ESG reviews 24 – 47 Governance review 48 – 59 Financial statements 60 – ibc