AUDIT COMMITTEE REPORT

FOR THE YEAR ENDED 30 JUNE 2010

The Audit Committee Report has been prepared in terms of section 270A(f) of the Companies Act 1973, as amended.

The audit committee has complied with the requirements of the King II Report and has conducted its work in accordance with the terms of reference which have been approved by the board and is recorded in the Corporate Governance Report for the financial year ended 30 June 2010.

AUDIT COMMITTEE MEMBERS AND ATTENDANCE AT MEETINGS

The committee comprises of Ms Nomgando Matyumza, the chairperson, Ms Nonhlanhla Mjoli-Mncube and Mr James Ngobeni, all independent non-executive board members and Mr Malcolm McCulloch a non-executive board member.

A table setting out the attendance at the audit committee meetings appears on page 72. Their CVs appear on page 12.

The CEO, CFO, the external audit partner, the internal audit manager and other senior managers attend the audit committee meetings by invitation.

The committee performed the following activities during the year:

Internal controls

During the financial year under the review, the audit committee considered the effectiveness of the internal audit procedures and approved the one-year operational internal audit work plan. The committee also monitored the adherence of the internal audit department to its annual plan.

Both the internal and external audit management reports concerning the effectiveness of the internal control environment, systems adopted and processes conducted were reviewed and debated.

The committee dealt with all matters raised in the reports from both the internal and external auditors and requested appropriate responses and actions from management.

Furthermore, the audit committee reviewed the processes in place for reporting matters of concern relating to accounting practices, internal audit procedures and practices, the adequacy of the auditing of the group’s financial statements, the internal controls of the group and any related matters.

During the year the audit committee made appropriate recommendations to the board regarding the corrective actions that had to be adopted as a consequence of the audit findings.

The group fraud policy was reviewed by the committee who satisfied themselves that any instances of whistle-blowing were appropriately resolved.

The ethical conduct of the group, its executives and senior management was found to be acceptable during the year.

Statutory duties

In terms of the audit committee’s statutory duties, the committee ensured that any extra or non-audit services that were provided by the external auditors were such that their independence would not be impaired and were approved and ratified by the board.The audit charter together with the audit committee working plan was approved by the board.

The committee was satisfied and reported to the board that the group is operating as a going concern and further satisfied itself that the group has reported in accordance with International Financial Reporting Standards. The audit committee was also satisfied that the group had complied with the JSE Listing requirements.

The committee ensured that both the internal and external audit functions were conducted independently and, to ensure this process held separate meetings with both the internal audit department and the external auditors, BDO South Africa Incorporated.

The committee had ensured that in agreeing the audit fee for the year, that the audit environment would not be curtailed in anyway and the appropriate level of scope be adopted.

The committee reviewed the performance, appropriateness and expertise of the chief financial officer and confirms his suitability for appointment in terms of the JSE requirements.

The audit committee nominated for appointment and further approval at the annual general meeting, BDO South Africa Inc. as the external auditor and accepted Mr SD Shaw as the designated audit partner for the 2011 financial year.

The audit committee is therefore satisfied that the group has adhered and complied with all the statutory requirements for the year ended 30 June 2010.

NNA Matyumza
Audit committee chairperson

23 September 2010