Milk, butter and cheese producer Dairy Crest Group, Britain’s largest dairy company, has announced it has chosen Deloitte as its external auditor for the year commencing 1 April 2017, ending a 20-year relationship with EY
In a statement to the stock exchange, Dairy Crest said: ‘This appointment will be subject to shareholder approval at the 2017 annual general meeting. The group's current auditor, Ernst & Young, is retiring by rotation and will carry out the audit for the year ending 31 March 2017.
The board would like to thank Ernst & Young for their contribution to the business over many years.’
In its 2016 annual report, Dairy Crest said its audit committee had discussed the implications of the new regulations requiring FTSE 350 companies to hold an audit tender every 10 years as well as the new EU regulations.
The committee noted that based on the EU transitional arrangements the final year that EY can be appointed as the group’s auditors is for the year ended 31 March 2020. At its meeting in March 2016, the committee considered the timing of a potential tender for the external audit. It concluded that the tender process should take place during 2016 to enable the appointment of a new external auditor in readiness for the start of the 2017/18 financial year on 1 April 2017. EY was not invited to tender.
EY has been the dairy company’s auditor since it floated in 1996. According to the latest annual report, the auditor was paid a total of £600,000 in 2015/16 of which £400,000 was for audit services and £200,000 for non-audit services. This was less than the £1m total paid to EY the previous year.
