Â鶹Éç World Service is responsible for commissioning and scheduling its own programmes and for making programmes for its language
services, but purchases English language programme-making and technical and support services from other divisions of the Â鶹Éç (the
Supplier Divisions). Â鶹Éç World Service also receives services from and supplies services to the Â鶹Éç’s commercial subsidiaries (the
Subsidiaries).
It was agreed by a joint Foreign and Commonwealth Office (FCO)/Â鶹Éç World Service Working Group that the Â鶹Éç would draw up
guidelines to govern the trading relationship between Â鶹Éç World Service and other parts of the Â鶹Éç, in order to ensure that Â鶹Éç
World Service maintains its distinctive voice and to preserve the clear separation between Grant-in-Aid and licence fee income.These
Trading Protocols were approved by the Governors’ Fair Trading Compliance Committee (FTCC) in 1997. Each of the Supplier Divisions
then drew up detailed agreements with Â鶹Éç World Service, specifying:
- the services to be provided
- criteria to ensure the quality of the services
- the cost of the services
The FTCC is responsible for monitoring and reviewing compliance with the Trading Protocols.The FTCC receives reports from
management on the effectiveness of the systems and procedures in place to ensure compliance with the Trading Protocols.
KPMG LLP (the external auditors) have reviewed a summary of the value of transactions and the related cash flows which have taken
place during the year between Â鶹Éç World Service and the Supplier Divisions and Subsidiaries. KPMG LLP have reported to the
Governors that, in their opinion, the information contained in the summary of transactions for the year ended 31 March 2006 has been
accurately extracted from the books and records of Â鶹Éç World Service and the Supplier Divisions and Subsidiaries, and has been
properly prepared on the bases of cost allocation and apportionment methods set out in the agreements between Â鶹Éç World Service
and the Supplier Divisions and Subsidiaries and, on this basis, there has been no material cross-subsidy between Grant-in-Aid and licence
fee funds or between Grant-in-Aid and the Â鶹Éç’s commercial subsidiaries.
Following regular reports to the FTCC by the Head of Fair Trading, and internal and external auditors, the Governors are satisfied that:
- the Trading Protocols reflect the requirements of the FCO/Â鶹Éç World Service Working Group
- agreements are in place which are consistent with the Trading Protocols
- there has been no material cross-subsidy between Grant-in-Aid and licence fee funds or between Grant-in-Aid and the Â鶹Éç’s
commercial subsidiaries
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Reports on compliance and regulatory matters |
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