Report on Corporate

Governance (continued)

Risk management

All potential acquisitions are subject to appropriate due diligence.

The Board is responsible for identifying the major business risks faced by the

Group and for determining the appropriate course of action to manage such

risks.

The Board has conducted an annual review of the effectiveness of the system

of internal control for the year ended 30 June 2001 and has taken account of

material developments since the year end.

Compliance

The Listing Rules require the Board to report on compliance with the Code

statement

provisions throughout the accounting period.  The Company was admitted to

the Official List on 11 January 2000, and since that date has sought to

implement fully the provisions of the Combined Code.  Save for the

exceptions outlined below, the Company has complied throughout the

accounting period ended 30 June 2001.

A.5.1

The Board does not have a Nomination Committee and 

having regard to the small size of the Board and existing 

Board arrangements there are no present plans to establish 

such a committee.

Going concern

After making enquiries, the directors have formed a judgement at the time of

approving the annual accounts, that there is a reasonable expectation that

the Group has adequate resources to continue in operational existence for

the foreseeable future.  For this reason, the directors continue to adopt the

going concern basis in preparing the annual accounts.  This statement also

forms part of the Operating and Financial Review.

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