EMBRACING CHANGE

 
PASSION, PEOPLE, PRODUCT

 
PRODUCT AND PRICE

 
BEST AT FRESH

 
BEST AT AVAILABILITY

 
BEST AT CUSTOMER SERVICE

 
THE SAFEWAY BOARD

 
FINANCIAL REVIEW

 
THE ACCOUNTS

• Group profit & loss account
• Reconciliation of movements in shareholders' funds
• Balance sheets
• Cash flow statement
• Reconciliation of net cash flow to movement in net debt
• Analysis of movement in net debt during the year
• General accounting policies
• Notes to the accounts
• Report of the Directors
• Directors' responsibilities
• Report of the auditors
• Shareholder information
• Five year retail statistical summary
• Five year financial summary

OUR STORES

Company law requires the directors to prepare accounts for each financial year which give a true and fair view of the state of affairs of the Company and the group and of the profit for that year. In preparing the accounts the directors are required:

(a) to select suitable accounting policies and then apply them consistently;

(b) to make judgements and estimates that are reasonable and prudent;

(c) to state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the accounts: and

(d)to prepare the accounts on the going concern basis unless it is inappropriate to presume that the group will continue in business.

The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and the group and to enable them to ensure that the accounts comply with the Companies Act 1985. They are also responsible for safeguarding the assets of the Company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors confirm that these accounts comply with these requirements.
 
 

To the Shareholders of Safeway plc

We have audited the accounts on pages 34 to 46 which have been prepared under the historical cost convention and the accounting policies set out on page 38. We have also examined the amounts disclosed relating to the emoluments, share options, long-term incentive scheme interests and pension benefits of the directors which form part of the Directors’ report on pages 47 to 53.

Respective responsibilities of directors and auditors

The Company's auditors, Arthur Andersen, have indicated their willingness to continue in office for another year. A resolution to appoint them as auditors will be proposed at the forthcoming Annual General Meeting.

The directors are responsible for preparing the Annual Report including, as described above, preparing the accounts in accordance with applicable United Kingdom law and accounting standards. Our responsibilities, as independent auditors, are established in the United Kingdom by statute, the Auditing Practices Board, the Listing Rules of the Financial Services Authority, and by our profession’s ethical guidance.

We report to you our opinion as to whether the accounts give a true and fair view and are properly prepared in accordance with the Companies Act. We also report to you if, in our opinion, the Directors’ Report is not consistent with the accounts, if the Company has not kept proper accounting records, if we have not received all the information and explanations we require for our audit, or if information specified by law or the Listing Rules regarding directors’ remuneration and transactions with the Company and the group is not disclosed.

We review whether the Corporate Governance statement on page 48 reflects the Company’s compliance with the seven provisions of the Combined Code specified for our review by the Financial Services Authority, and we report if it does not. We are not required to consider whether the board’s statements on internal control cover all risks and controls, or form an opinion on the effectiveness of the company’s corporate governance procedures or its risk and control procedures.

We read the other information contained in the Annual Report, including the Corporate Governance statement, and consider whether it is consistent with the audited accounts. We consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the accounts.

Basis of audit opinion

We conducted our audit in accordance with Auditing Standards issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the accounts. It also includes an assessment of the significant estimates and judgements made by the directors in the preparation of the accounts, and of whether the accounting policies are appropriate to the circumstances of the Company and of the group, consistently applied and adequately disclosed.

We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the accounts are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion, we also evaluated the overall adequacy of the presentation of information in the accounts.

Opinion

In our opinion the accounts give a true and fair view of the state of affairs of the Company and of the group at 1 April 2000 and of the group’s profit and cash flows for the year then ended and have been properly prepared in accordance with the Companies Act 1985.

Arthur Andersen
Chartered Accountants and Registered Auditors
London
24 May 2000