Hi everyone, sorry to only get back on here now, we had unexpected visitors this evening.
Really, really touched by all your very kind and helpful responses - thank you so much.
I will definitely have a look at CEOP (thanks Ellie)
and 'think you know' (thanks Whoknows)
Sorry to hear that you are having your own issues with this DEM too - this technology stuff is such a nightmare!
I am kicking myself because after all exams/studying etc I had given dd more slack than usual wrt computer use (in terms of length of time she could go on line for). Was aware she was skyping someone whilst playing Star Stable (I was in room alongside fhs!) but she told me it was a school friend we both know (and I actually went in and out of room several times to put clothes away whole she was deep in conversation and laughing and chatting etc!!). Luckily I mentioned I was e-mailing said friend's mother about a play date later in the week and said I might say something about length of time both of our dd's were on-line together (hope my dd is not leading your dd astray by spending so much time on SS type of thing) and the expression on dd's face told me something was wrong.
Trouble is, I didn't say that as some sort of test; I wasn't remotely suspicious! 
I really can't believe it because dd understood the rule we have about only chatting to people who she (and we) know in rl. Really disappointed that she lied. She said she did so because "she was having so much fun" 
She knew she had done something wrong but of course doesn't really understand wider implications. Then when I called dh in and we started to explain I think the realisation dawned and she started to cry and get quite upset.
Dh then called Skype number and dd got the child and the child's mother on the line and dh spoke to them and they seem genuine enough thankfully but it is all a bit scary.
I was bloomin furious when I found out but tried to keep a lid on it because important to keep lines of communication open I think and then issue odious punishment later like picking up dog poo for a month 
DD and I have since gone through some NSPCC materials together but now she's older, it's difficult to explain why any child is in danger when chatting to strangers on-line, or browsing on-line, without actually explaining the context (ie grooming, other things you might see on Internet that are not appropriate etc). Not really sure how to go in to this without scaring her, hence posting tonight! So thank you again everyone!
Heigh ho, one lives and learns. Will certainly be taking the subject of Internet safety a lot more seriously from now on. We have parental controls, we had rules, but tbh they hadn't been updated since dd was about 8yrs old, so high time we focused on this a bit more.
Apologies again for hi-jack!
Blue and Ellie well done on the decluttering and the Flying front!
Hope you are feeling better Toffee
G'night all!!