EXTERNAL AUDITOR APPOINTMENT FOR FY21 We believe that our policy is still relevant and safeguards It is the Committee’s responsibility to akeecommendations auditor independence and objectivity effectively. In June to the Board in relation to the appointment, reappointment 2020, we adopted a formal policy on recruitment of former and removal of the external auditor, and to agree the audit fee. employees of the external auditor, which is also available on our website, to further promote this. We are pleased to In February 2021, the external auditor presented their confirm that we complied with all of these policies during strategy for the FY21 audit to the Committee. The Committee the year. reviewed and agreed with the external auditor’s assessment of risk. The Committee also reviewed and agreed the audit During the period we paid PricewaterhouseCoopers LLP approach and the approach to assessing materiality for the £40,000 for their review of the interim financial statements Group. (considered to be a non-audit service). No other non-audit services were provided by the external auditor. Fees paid to The fee proposed by PricewaterhouseCoopers LLP for PricewaterhouseCoopers LLP for audit work were £254,000. the statutory audit of the Group and Company financial statements and the audit of Group subsidiaries pursuant to AUDITOR ROTATION legislation was £254,000. A competitive tender is in the best interests of shareholders, and our auditor rotation policy is that we will tender the audit Taking into account the review of the FY20 audit and at least once every ten years; we will change auditor at least the proposed plan and fee, the Committee agreed that every 20 years; and we will invite at least one firm outside PricewaterhouseCoopers LLP be reappointed as auditor for the ‘Big Four’ to participate. This is in line with the current the FY21 audit for the fee proposed. Resolutions to reappoint EU Audit Directive. The latest date for the next tender will PricewaterhouseCoopers LLP as auditor and to authorise therefore be for the FY24 audit, which we are likely to conduct the Directors to agree their remuneration will be put to in FY23. The Committee is aware of the government proposal shareholders at the AGM. for shared audits of FTSE350 companies; if this becomes law we will take this into account in the tender process. SAFEGUARDING AUDITOR INDEPENDENCE AND OBJECTIVITY I can confirm that the Company has complied with The The Committee is awarethatthe use of audit firms for non Statutory Audit Services for Large Companies Market audit work is a sensitive issue for investors and corporate - Investigation (Mandatory Use of Competitive Tender governance analysts, as it could potentially give rise to a Processes and Audit Committee Responsibilities) Order conflict of interest and jeopardise the independence of the 2014 during the financial year. audit process. RISK MANAGEMENT AND INTERNAL CONTROL Following the issue of the EU Audit Directive in June 2016, we Effectiveness of risk management and internal reviewed our policy on the use of auditors for non-audit work control systems in September 2016. The full policy is available on our website, The Committee is responsible for assessing the scope and corporate.dunelm.com, but in summary from FY17: effectiveness of the systems established by management • Fees for non-audit services provided by the statutory to identify, assess, manage and monitor financial and non- auditor in any year may not exceed 70% of the average fees financial risks, and to considerthe level of assurance. The for the Group statutory audit in the three previous years. effectiveness of our risk management and internal control • The auditor is prohibited from providing certain non-audit systems are reviewed annually and this was carried out in services, including: almost all tax work; internal audit; September 2020 and September 2021. The conclusion of this corporate finance; involvement in management activities, review was that: including working capital and cash management and the • The systems established by management to identify, provision of financial information. assess, manage and monitor financial and non-financial • The external auditor may not be engaged to provide any risks and identify emerging risks have been improved year non-audit services without the agreement of the Audit and over year and are effective; and Risk Committee Chair. • The assurance on risk management and internal control POLICY systems is sufficient to enable the Board to satisfy itself that they are operating effectively. DUNELM GROUP PLC ANNUAL REPORT & ACCOUNTS 2021 135 GOVERNANCESTRATEGIC REPORT FINANCIAL STATEMENTSOTHER INFORMATION