Annual Report & Accounts 2010
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  • Report of the Auditors on the Group financial statements

    Independent auditors’ report to the members of
    Northumbrian Water Group plc

    We have audited the Group financial statements of Northumbrian Water Group plc for the year ended 31 March 2010 which comprise the Consolidated income statement, the Consolidated statement of comprehensive income, the Consolidated statement of changes in equity, the Consolidated balance sheet, the Consolidated cash flow statement and the related notes 1 to 28. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRS) as adopted by the European Union.


    This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.


    Respective responsibilities of directors and auditors

    As explained more fully in the Statement of directors’ responsibilities set out here, the directors are responsible for the preparation of the Group financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit the Group financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.


    Scope of the audit of the financial statements

    An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the Group’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the directors; and the overall presentation of the financial statements.


    Opinion on financial statements

    In our opinion the Group financial statements:

    • give a true and fair view of the state of the Group’s affairs as at 31 March 2010 and of its profit for the year then ended;
    • have been properly prepared in accordance with IFRS as adopted by the European Union; and
    • have been prepared in accordance with the requirements of the Companies Act 2006 and Article 4 of the IAS Regulation.

    Opinion on other matters prescribed by the Companies Act 2006

    In our opinion:

    • the information given in the Directors’ report and business review for the financial year for which the financial statements are prepared is consistent with the Group financial statements; and
    • the information given in the Corporate governance report with respect to internal control and risk management systems in relation to financial reporting processes and about share capital structures is consistent with the financial statements.

  • Matters on which we are required to report by exception

    We have nothing to report in respect of the following:


    Under the Companies Act 2006 we are required to report to you if, in our opinion:

    • certain disclosures of directors' remuneration specified by law are not made;
    • we have not received all the information and explanations we require for our audit; or
    • a corporate governance statement has not been prepared by the Company.

    Under the Listing Rules we are required to review:

    • the directors' statement, set out here, in relation to going concern; and
    • the part of the Corporate governance report relating to the Company's compliance with the nine provisions of the June 2008 Combined Code specified for our review.

    Other matters

    We have reported separately on the parent Company financial statements of Northumbrian Water Group plc for the year ended 31 March 2010 and on the information in the Directors' remuneration report that is described as having been audited.


    Debbie O'Hanlon (Senior statutory auditor)

    For and on behalf of Ernst & Young LLP

    Statutory Auditor

    Newcastle upon Tyne

    1 June 2010

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