Gerontología Ambiental

Subject to the provisions of the Companies Act 2006, the company’s Articles of Association and to any directions given by special resolution, the business of the company shall be managed by the board which may exercise all the powers of the company.

Directors’ indemnity

In accordance with the company’s Articles of Association, the company has granted directors an indemnity, to the extent permitted by law, in respect of liabilities incurred as a result of their office. The company also purchased and maintained throughout the year Directors’ and Officers’ liability insurance in respect of itself and its directors.

Related party transactions

Internal controls are in place to ensure that any related party transactions involving directors or their connected persons are carried out on an arm’s length basis and are properly recorded.

Conflict of interest

The company’s Articles of Association permit the board to approve situations where a director has an interest that conflicts, or may possibly conflict, with the interests of the company. The board has established a formal system whereby the Nominations Committee considers and decides whether to authorise any such conflict or potential conflict, and whether to impose limits or conditions when giving authorisation. In reaching its decision, the Nominations Committee is required to act in a way it considers would be most likely to promote the success of the company.

Charitable and political donations

Through the Reed Elsevier Cares programme, which concentrates on education for disadvantaged young people, Reed Elsevier companies made donations during the year for charitable purposes amounting to £2.5m (2008: £2.1m) of which £0.5m (2008: £0.5m) was in the United Kingdom. Further information concerning the Reed Elsevier Cares programme is available from the Reed Elsevier Corporate Responsibility Report at www.reedelsevier.com/

CorporateResponsibility.

In the United States, Reed Elsevier companies contributed £46,000 (2008: £39,000) to political parties. There were no donations made in the European Union for political purposes.

Financial statements and accounting records

The directors are responsible for preparing the directors’ report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors are required to prepare the consolidated financial statements in accordance with International Financial Reporting Standards as adopted by the European Union and Article 4 of the IAS Regulation and have elected to prepare the parent company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the

In preparing the parent company financial statements, the directors are required to: select suitable accounting policies and then apply them consistently; make judgments and accounting estimates that are reasonable and prudent; state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

In preparing the group financial statements, IAS1 requires that directors: properly select and apply accounting policies; present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information; provide additional disclosures when compliance with the specific requirements in IFRSs are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity’s financial position and financial performance; and make an assessment of the company’s ability to continue as a going concern.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company’s transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Directors’ responsibility statement

The board confirms that to the best of its knowledge:

> the consolidated financial statements, prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board and as adopted by the European Union, give a true and fair view of the financial position and profit or loss of the group; and

> the Directors’ Report includes a fair review of the development and performance of the business and the position of the group, together with a description of the principal risks and uncertainties that it faces.

Neither the company nor the directors accept any liability to any person in relation to the Annual Report except to the extent that such liability could arise under English law. Accordingly, any liability to a person who has demonstrated reliance on any untrue or misleading statement or omission shall be determined in accordance with Section 90A of the Financial Services and Markets Act 2000.

Disclosure of information to auditors

As part of the process of approving the company’s 2009 financial statements, the directors have taken steps pursuant to section 418(2) of the Companies Act 2006 to ensure that they are aware of any relevant audit information and to establish that the company’s auditors are aware of that information. In that context, so far as the directors are aware, there is no relevant audit information of which the company’s auditors are unaware.

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Corporate governance

The company has complied throughout the period under review with the provisions of the Combined Code on Corporate Governance issued in June 2008 (the “UK Code”).

Details of how the principles of the UK Code have been applied and the directors’ statement on internal control are set out in the Structure and Corporate Governance report on pages 56 to 61. Details of the role and responsibilities, membership and activities of the Reed Elsevier Audit Committees, including the company’s Audit Committee, are set out in the Report of the Audit Committees on pages 79 and 80.

Going concern

The directors, having made appropriate enquiries, consider that adequate resources exist for the combined businesses to continue in operational existence for the foreseeable future and that, therefore, it is appropriate to adopt the going concern basis in preparing the 2009 financial statements. In reaching this conclusion, the directors have had due regard to the combined businesses’ financial position as at 31 December 2009, the strong free cash flow of the combined businesses, Reed Elsevier’s ability to access capital markets and the principal risks facing Reed Elsevier.

A commentary on the Reed Elsevier combined businesses’ cash flows, financial position and liquidity for the year ended 31 December 2009 is set out in the Chief Financial Officer’s Report on pages 38 and 39. This shows that after taking account of available cash resources and committed bank facilities that back up short term borrowings none of Reed Elsevier’s borrowings fall due within the next two years. Reed Elsevier’s policies on liquidity, capital management and management of risks relating to interest rate, foreign exchange and credit exposures are set out on pages 42 and 43. Further information on liquidity of the combined businesses can be found in note 19 of the combined financial statements. The principal risks facing Reed Elsevier are set out on pages 47 and 48.

Creditor payment policy

Reed Elsevier companies agree terms and conditions for business transactions with suppliers, including the terms of payment. Reed Elsevier does not operate a standard code in respect of payments to suppliers. The average time taken to pay suppliers was between 30 and 45 days (2008: between 30 and 45 days).

Articles of Association

A special resolution will be proposed at the 2010 Annual General Meeting of the company to approve a number of amendments to the company’s Articles of Association, primarily to reflect the implementation of the Shareholders’ Rights Directive in August 2009 and the remaining provisions of the Companies Act 2006 in October 2009.

Auditors

Resolutions for the reappointment of Deloitte LLP as auditors of the company and authorising the directors to fix their remuneration will be submitted to the 2010 Annual General Meeting.

By order of the board Registered Office

Stephen J Cowden 1-3 Strand

Secretary London