Audit and risk committee's report

IN TERMS OF SECTION 270A(1)(F) OF THE COMPANIES ACT, NO. 61 OF 1973, AS AMENDED ("THE ACT")

The Audit and Risk Committee comprised the following independent non-executive directors during the 2009 financial year and at the date of this report:

• MJ Leeming (chairman)
• RMW Dunne
• LM Nyhonyha

The Audit and Risk Committee reports that it has adopted appropriate formal terms of reference as its Audit and Risk Committee mandate, and has regulated its affairs in compliance with this mandate, and has discharged all of the responsibilities set out therein.

The Audit and Risk Committee considered the matters set out in Section 270A(5) of the Act, as amended by the Corporate Laws Amendment Act, and is satisfied with the independence and objectivity of KPMG Inc. as external auditors and Mr N van Niekerk as the designated auditor. The Audit and Risk Committee further determined the fees to be paid to KPMG Inc. and its terms of engagement and pre-approved any proposed contract with KPMG Inc. for the provision of non-audit services to the Company.

As required by the JSE Listings Requirement 3.84(h), the Audit and Risk Committee has satisfied itself that the chief financial officer has the appropriate expertise and experience.

The Audit and Risk Committee is satisfied that there was no material breakdown in the internal accounting controls during the financial year. This is based on the information and explanations given by management and the Group internal audit function as well as discussions with the independent external auditors on the results of their audits.

The Audit and Risk Committee has evaluated the financial statements of AECI Limited and the Group for the year ended 31 December 2009 and, based on the information provided to the Audit and Risk Committee, considers that the Group complies, in all material respects, with the requirements of the Act and International Financial Reporting Standards.

MJ Leeming

Chairman
Audit and Risk Committee

30 March 2010