Strategic ReportStrategic ReportStrategic Report Financial Additional Overview Strategy Performance Governance Statements Information Audit Committee Report Upholding integrity, transparency and accountability Jonathan Muir Chairman of the Audit Committee I am delighted to provide my first report as Chairman of The Committee also worked with management and the Audit Committee (the “Committee”) on its activities. the external auditor to review the changes required in response to the introduction of new accounting standards, Generally, the Committee recommends the financial particularly IFRS 9 for financial instruments recognition statements to the Board and reviews the Group’s financial and measurement. reporting and accounting policies, including formal announcements and trading statements relating to the Towards the end of the year, the Committee agreed Company’s financial performance. It also oversees the new terms of reference to reflect the revised UK relationship with Ernst & Young LLP (“EY”), the Group’s Corporate Governance Code. In 2019, the Committee external auditor, and the role and effectiveness of the will expand its role to include corporate governance internal audit function. of the Bank as required by the National Bank of Georgia. During the year, we saw a number of significant The Committee reviewed and approved the internal changes, including: audit plan and execution for 2018. The Committee also •the impact of the Demerger of BGEO Group PLC into continued to ensure the integrity of the Company’s the Bank of Georgia Group PLC and Georgia Capital published financial information and reviewed the PLC, on financial statements, people and processes; judgements made by management and the assumptions •new accounting standards (including IFRS 9 and 16 and estimates on which they are based. effective from 1 January 2019); •changes to the UK Corporate Governance Code; I, and the Committee more widely, firmly believe that •the role of the Committee in corporate governance the Group has strong foundations in place in terms of as required by the National Bank of Georgia; and risk management and internal control processes and •a new Head of Internal Audit, Nino Gordeladze. structures and I look forward to the Committee playing a very active role in continuing to build upon these In response to these changes, and as well as its routine foundations over the course of 2019. business, the Committee monitored, reviewed and commented on the changes to control, people and I now invite you to read this year’s Committee report. reporting necessitated by the Demerger and satisfied itself on the various impacts on the Group including its Jonathan Muir internal controls, and reporting. In addition, as a direct Chairman of the Audit Committee impact of the Demerger, some changes were made 27 March 2019 to the Committee’s composition. I was appointed as the Chairman of the Committee and: •Cecil Quillen and Tamaz Georgadze were appointed on 24 February 2018; and •Andreas Wolf was appointed on 1 October 2018. Annual Report 2018Bank of Georgia Group PLC 121