Independence policies, safeguards and procedures

Safeguards and procedures

• Every audit opinion issued by Ryecroft Glenton (“the Firm”) is subject to technical review by a partner who is registered with ICAEW as a responsible individual (“RI”).
• We report annually to you our assessment of our objectivity and independence. This report includes a summary of non-audit services provided over the past year together with fees received in absolute terms and as a proportion of the audit fee. Where these may be perceived to compromise our independence because of the magnitude of fees arising from non-audit services, whether in absolute terms or as a proportion of the audit fee, we bring this to your attention and agree appropriate safeguards to address the perception that our independence and objectivity may be compromised. Where these exceed the audit fee agreed between us we also must agree appropriate safeguards with our ethics partner.
• We are not permitted to charge fees for the audit which are calculated on a contingent basis. Nor are we permitted to undertake non-audit services on a contingent fee basis (whether the fee is material to Ryecroft Glenton or not), where the outcome of the non-audit service is dependent on a future or contemporary audit judgement relating to a material matter in the financial statements.
• There is formal consideration and review of the appropriateness of continuing the audit before accepting reappointment.
• Where the audit engagement partner has acted for more than 10 years we subject the audit performed to an Engagement Quality Control Review carried out by an Independent Review Partner.
• In accordance with the Ethical Standard issued by the Financial Reporting Council, there is an assessment of the level of threat to objectivity and independence together with potential safeguards to mitigate these threats prior to acceptance of any non-audit engagement. This would include particular focus on threats arising from self-interest, self-review, management, advocacy, and over-familiarity. Where such threats are identified if possible safeguards are put in place such as an Engagement Quality Control Review performed by an Independent Review Partner. Alternatively we do not accept the non-audit engagement.
• The Firm’s policies and procedures are subject to external monitoring by the ICAEW’s Quality Assurance Directorate (QAD). The QAD is charged with monitoring statutory compliance of audits for all entities that are not “economically significant” e.g. listed companies. QAD reports to the ICAEW’s Audit Registration Committee who is charged with the registration of audit firms and RIs operating within them. Please note, the QAD does not publish individual inspection reports and we are not permitted to disclose details of their findings.
• As members of HCWA (a network of likeminded independent firms of Accountants) we are also subject to their bi-annual external monitoring and we participate in joint initiatives to improve our audit service.
• Where the entity qualifies as a small entity, we adopt the provisions available for audits of small entities if that entity has a person who is considered to be informed management and it has been agree that we may rely on that person and their knowledge and expertise that allows them to be treated as suitably informed.

Ethical and independence policies

Our detailed ethical and independence policies are issued to all partners and staff, who are required annually to confirm their compliance with these policies. Where relevant, we are also required to comply with the policies of other professional and regulatory bodies.

Amongst other things, these policies:

• state that no Ryecroft Glenton partner or immediate family member is allowed to hold a beneficial or financial interest in any of our audit clients;
• require that professional staff or any immediate family member may not work on assignments if they have a financial interest in the client or are a party to a transaction or if they have a beneficial interest in a trust holding a financial position in the audit client;
• state that no person in a position to influence the conduct and outcome of the audit or any immediate family member should enter into business relationships with any of our audit clients or their affiliates;
• prohibit any partner or professional employee or their immediate family members from obtaining gifts or hospitality from an audit client unless the value is clearly insignificant in terms of their frequency, nature and cost; and require us to create safeguards against potential conflicts of interest.

Remuneration and evaluation policies

Partners are evaluated on the roles and responsibilities they take within the firm including their technical ability and their ability to manage risk. Their remuneration is not linked to their performance on any one assignment or group of assignments.