Terms of Reference

Audit and Risk Committee (“the Committee”)

1. Purpose

The Audit and Risk Committee (the “Committee”) of Camellia plc (the “Company”) assists the Board of Directors of the Company (the “Board”) in fulfilling its responsibilities as follows:

Review and monitor the effectiveness of the risk management and internal controls of the Company and its subsidiaries (the “Group”)’;
Review and make recommendations to the Board on the integrity of the Company’s and Group’s financial reporting;
Monitor the Group’s internal audit and external audit functions and make recommendations to the Board; and
Carry out other financial, audit and controls oversight activities on behalf of the Board.

2. Operations of the committee

2.1. Membership

The Committee shall comprise at least two members. Members of the Committee shall be appointed by the Board on the recommendation of the Nominations and Governance Committee, in consultation with the Chair of the Committee (the “Committee Chair”).

All members of the Committee shall be independent non-executive directors, at least one of whom shall have recent and relevant financial experience, ideally with a professional qualification from one of the professional accountancy bodies. The Chair of the Board shall not be a member of the Committee.

Only members of the Committee shall be entitled to attend Committee meetings. However, the external auditor, Company Secretary, Chief Executive Officer and Chief Financial Officer will be invited to attend meetings of the Committee on a regular basis, and other non-members may be invited to attend all or any part of a meeting as and when appropriate and necessary.

The Board shall appoint the Committee Chair on the recommendation of the Nominations and Governance Committee. In the absence of the Committee Chair, the remaining members present, shall elect one of themselves to chair the meeting.

2.2. Secretary

The Company Secretary, or his or her nominee, shall act as the secretary of the Committee and will ensure that the Committee receives information and papers in a timely manner to enable full and proper consideration to be given to issues.

2.3. Quorum

The quorum necessary for the transaction of business shall be two members.

2.4. Frequency of meetings

The Committee shall meet at least three times a year at appropriate intervals in the financial reporting and audit cycle and otherwise as required.

Outside of the formal meeting programme, the Committee Chair will maintain a dialogue with key individuals involved in the governance of the Company, including the Chairman of the Board, the Chief Executive Officer, the Chief Financial Officer, the General Counsel and the external audit lead partner.

2.5. Minutes of meetings

The Secretary, or his or her nominee, shall minute the proceedings and decisions of all meetings of the Committee, including recording the names of those present and in attendance.

2.6. Annual General Meeting

The Committee Chair shall attend the Company’s Annual General Meetings.

3. Duties

The Committee should carry out the duties set out below.

3.1. Governance

The Committee shall:

Work and liaise as necessary with the Board and, when reviewing operating company matters the Committee shall work with the subsidiary Operating Company’s audit committee (and/or Board) and management, in conjunction with the shareholder representative.
Review annually the composition, terms of reference and performance of the Committee and Operating Company Audit and Risk Committees to ensure it/they is/are operating effectively and recommend any changes it considers necessary.

3.2. Financial reporting

The Committee shall monitor the integrity of the financial statements of the Company (i.e. the parent company statements of Camellia plc as well as the consolidated statements of the Group), including its annual and half-yearly reports, interim management statements, and any other formal announcement relating to the financial performance of the Group, reviewing and reporting to the Board on significant financial reporting issues and judgements, having regard to matters communicated to it by the External Auditors.

In particular, the Committee shall review and challenge where necessary:

the consistency of, and any changes to, significant accounting policies;
the methods used to account for significant or unusual transactions where different approaches are possible;
whether appropriate accounting standards have been followed, and appropriate estimates and judgements have been made; considering the views of the External Auditors;
the clarity and completeness of disclosure in the Company’s financial reports and the context in which statements are made
the potential impact of the implementation of the Company’s strategy and climate change on the financial statements, and
all material information presented with the financial statements, such as the business review and the corporate governance statements.

Where the Committee is not satisfied with any aspect of the proposed financial reporting, it shall report its views to the Board.

3.3. Narrative reporting

Where requested by the Board, the Committee shall review the content of the Company’s annual report and accounts and advise the Board on whether, taken as a whole, it is true, fair, balanced and understandable and provides the information necessary for shareholders to assess the Group’s performance, business model and strategy.

3.4. Risk Management

The Committee shall oversee and seek suitable assurance regarding:

the process to determine the Group’s overall risk appetite, tolerance and strategy, and the principal and emerging risks the Company is willing to take in order to achieve its long-term strategic objectives;
the principal risks the Group may be exposed to, including new and emerging risks and horizon risks;
the Group’s ability to reduce the likelihood of principal risks materialising and the impact on the Group of risks that do materialise;
the risk aspects of proposed changes to strategy and strategic transactions including acquisitions or disposals, ensuring that a due diligence appraisal of the proposition is undertaken, focusing in particular on implications for the risk appetite, tolerance and strategy of the Group, and taking independent external advice where appropriate and available; and
the adequacy and effectiveness of the Group’s processes and procedures to identify and manage risk, including the design, implementation and effectiveness of those systems.

The Committee shall:

ensure the Board is informed of the likelihood and the impact of principal risks materialising, and the management and mitigation of principal risks to reduce the likelihood of their incidence or their impact; and
review and approve the statements to be included in the annual report concerning risk management, including the assessment of principal risks and emerging risks, and the viability statement.
review periodically the risk reports relating to the Group’s key risks, including the responses from management to these key risks and assess the adequacy and effectiveness of the corrective actions taken;
review the appropriateness of the Group’s values and culture and reward systems for impact on the management of risk and internal controls.

3.5. Internal financial controls

The Committee shall:

keep under review the adequacy and effectiveness of the Group’s financial controls;
understand the scope of internal and external auditors’ review of internal controls over financial reporting and obtain reports on significant findings and recommendations together with management responses; and
review and approve the statements to be included in the annual report concerning financial controls.

3.6. Compliance, whistleblowing and fraud

The Committee shall review the Group’s:

whistleblowing arrangements, including independence, non-retaliation, adequate resourcing, appropriate access to information and freedom from restrictions.
procedures for detecting fraud and receive reports on serious or endemic non-compliance or fraud involving senior management;
systems and controls for the prevention of bribery and tax evasion and receive reports on non-compliance;
systems and controls for the prevention of money laundering and receive reports on non-compliance;

3.7. Internal Audit

The Committee shall review/approve[1]:

annual audit plans and all major changes to the plans previously submitted and reviewed;
the appointment of Chief Internal Auditors;
the Group’s model internal audit charter and model audit and risk committee terms of reference;
the Group’s internal audit model and procedures;
resourcing of the audit functions;
any arrangements, in advance of appointment, for the outsourcing of responsibility for internal audit, including:

1. the level of fees that is appropriate to enable an effective and high-quality internal audit to be conducted and the terms of engagement, including any engagement letter issued at appointment;
2. assessing annually the independence and objectivity of any outsourced arrangements for internal audit;
3. satisfying itself that there are no relationships (such as family, employment, investment, financial or business) between the auditor and the relevant company (other than in the ordinary course of business) which could adversely affect the internal auditor's independence and objectivity; and
4. monitoring the internal auditor's compliance with relevant ethical and professional guidance on the rotation of audit partner, the level of non-audit fees paid by the company compared to the audit fees earned by the firm.

vii: the ongoing effectiveness of the internal audit functions including, where appropriate, requesting, in collaboration with the operating company audit committees, the commissioning of independent reviews of the arrangements for internal audit. These reviews can include, but not be limited to:

1. conformance with The Institute of Internal Auditors (IIA’s) International Standards for the professional practice of internal auditing;
2. compliance with The Institute of Internal Auditors’ International Professional Practice Framework (IPPF) standards;
3. the appropriateness of the levels of staffing and skills within the individual internal audit functions;
4. the appropriateness of the reporting lines of the internal audit functions;
5. the effectiveness of the internal audit function in identifying issues, and the quality of the recommendations made to resolve the issues; and
6. the quality of the internal audit working papers produced and compliance with required standards.

3.8. External audit

3.8.1. The Committee shall:

manage and oversee the tender process for the appointment of the audit firm or audit firms as the Company’s External Auditors;
consider and make recommendations to the Board, to be put to shareholders for approval at the Company’s AGM, in relation to the appointment, reappointment and removal of the Company’s External Auditor(s);
if the Company’s external auditor resigns, investigate the issues leading to this and decide whether any action is required;
oversee the relationship with the external auditor(s) including (but not limited to):

a. recommendations on their remuneration, including both fees for audit and non-audit services, and that the level of fees is appropriate to enable an effective and high-quality audit to be conducted;

b. approval of their terms of engagement, including any engagement letter for the External Auditor’s annual audit of the Company’s consolidated and standalone financial statements and the scope of the audit;

c. assessing annually their independence and objectivity taking into account relevant professional and regulatory requirements and the relationship with the auditor as a whole, including the provision of any non-audit services;

d. approval of any non-audit services performed by the auditor;

e. review of any non-audit services provided by the auditor to operating companies;

f. review the appointment or removal of operating companies’ external auditor where it is different from the Company;

g. satisfying itself that there are no relationships (such as family, employment, investment, financial or business) between the auditor and the Company (other than in the ordinary course of business) which could adversely affect the auditor’s independence and objectivity;

h. agreeing with the Board a policy on the employment of former employees of the Company’s auditor, and monitoring the implementation of this policy;

i. monitoring the auditor’s compliance with relevant ethical and professional guidance on the rotation of audit partner, the level of non-audit fees paid by the Company compared to the audit fees earned by the firm;

j. assessing annually the qualifications, expertise and resources of the auditor and the effectiveness of the audit process, which shall include a report from the external auditor on their own internal quality procedures; and

k. evaluating the risks to the quality and effectiveness of the financial reporting process and consideration of the need to include the risk of the withdrawal of their auditor from the market in that evaluation.

v. meet regularly with the External Auditor (including once at the planning stage before the audit and once after the audit at the reporting stage) and at least once a year, without management being present, to discuss the auditor’s remit and any issues arising from the audit;

vi. review and approve the annual external audit plan and ensure that it is consistent with the scope of the audit engagement, having regard to the seniority, expertise and experience of the audit team; and

vii. review the findings of the audit with the External Auditors. This shall include but not be limited to, the following:

a. a discussion of any major issues which arose during the audit;

b. key accounting and audit judgements;

c. levels of errors identified during the audit; and

d. the effectiveness of the audit process.

3.8.2. The Committee shall also:

i. review any representation letter(s) requested by the External Auditor before they are signed by management;

ii. review the management letter and management’s response to the External Auditor’s findings and recommendations; and

iii. develop and implement policy on the supply of non-audit services by the External Auditor to avoid any threat to auditor objectivity and independence, taking into account any relevant ethical guidance on the matter.

3.9. Group Guiding Principles

i. The Committee shall review the Group Guiding Principles and other governance documents that are relevant to the Committee’s activities and recommend any changes.

ii. The Committee shall review any Operating Company policies or procedures that are materially different from the Group Guiding Principles.

3.10. Banking and Treasury

The Committee shall review and recommend any changes to the following:

i. Group Treasury policies

ii. Operating company treasury policies that are materially difference from the Company policy

iii. Material changes to any pension scheme;

iv. New banking relationships of the Group; and

v. New, material financing arrangements of the Group

3.11. Reporting Responsibilities

The Committee Chair shall report formally to the Board on its proceedings after each meeting on all material matters within its duties and responsibilities and on how it has discharged its responsibilities. This report shall include:

the significant issues that it considered in relation to the financial statements and how these were addressed;
its assessment of the effectiveness of the external audit process and its recommendation on the appointment or reappointment of the external auditor;
all significant risk management, internal financial control and compliance matters identified by the internal auditors; and
any other issues on which the Board has requested the Committee’s opinion.

The Committee shall make recommendations to the Board, or to the Board of an operating company, on any area within its remit where action or improvement is sought.

The Committee shall compile a report on its activities to be included in the Company’s annual report. The report should include an explanation of how the Committee has addressed the effectiveness of the external audit process; the significant issues that the Committee considered in relation to the financial statements and how these issues were addressed, having regard to matters communicated to it by the external auditor.

In compiling these reports, the Committee should exercise judgement in deciding which of the issues it considers in relation to the financial statements are significant but should include at least those matters that have informed the Board’s assessment of whether the Company is a going concern. The report to shareholders need not repeat information disclosed elsewhere in the annual report and accounts but could provide cross-references to that information.

4. Other matters

The Committee shall:

have access to sufficient resources in order to carry out its duties, including access to the Company secretariat for assistance as required;
be provided with appropriate and timely training, both in the form of an induction programme for new members and on an ongoing basis for all members;
give due consideration to laws and regulations, and the requirements of the AIM Rules for companies and any other applicable rules, as appropriate; and
investigate or commission the investigation of any issues or concerns it deems appropriate in collaboration with the relevant shareholder representative and / or the Chair of the Operating Company Audit Committee.

5. Authority

The Committee is authorised to:

seek any information it requires from any officer, manager or employee of the Company and external parties in order to perform its duties;
obtain, at the Company’s expense, independent legal, accounting or other professional advice on any matter it believes it necessary to do so;
call any employee to be questioned at a meeting of the Committee as and when required in collaboration with the relevant shareholder representative and / or the chair of the respective operating company audit committee; and
have the right to publish in the Company’s annual report, details of any issues that cannot be resolved between the Committee and the Board.

Approved 28 January 2026

[1] For Company matters, approval is required, for Operating Company matters, review by the Committee prior to approval by the operating company boards is required.