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The Board regularly reviews the business risks of the
Trust and examines liability management and risks
including those relating to the India property sector. The
overall framework established by the Board to enhance
the soundness of the Trust’s fnancial reporting, risk
management, compliance, information technology and
internal control systems includes:
Formulation and implementation of an enterprise
risk management framework which comprises a risk
register and related internal controls to mitigate such
risks which is regularly reviewed by the Board;
Audits performed by an internal auditor in accordance
with the audit plan;
Process improvement initiatives undertaken by the
asset companies;
Implementation of formal policies and procedures
relating to the delegation of authority;
Involvement of experienced and suitably qualifed
employees who take responsibility for important
business functions; and
Segregation of key functions which may give rise to
possible errors or irregularities.
The AC assists the Board in examining the effectiveness
of the Trust’s risk management policies to ensure that a
robust risk management system is maintained. The AC
reviews and guides Management in the formulation of
risk policies and processes to effectively identify, evaluate
and manage any material risk. The AC reports to the
Board on material fndings and makes recommendations
in respect of any material risk issues.
To support the AC in its review of the internal controls.
Management completes a checklist verifying that
adequate internal controls were in place to monitor
fnancial, legal and other relevant risks at the end of the
fnancial year.
In the course of their statutory audit, the external auditor
had considered the risk assessment conducted by the
internal auditor. Any material non-compliance and internal
control weakness, together with the internal auditor’s
recommendations to address them, are reported to
the AC.
The Trust also has both a comprehensive insurance
coverage and a business continuity plan.
Internal audit
The internal auditors assist the AC in ensuring that
Management maintains a sound system of internal
controls by regular monitoring of key controls and
procedures and ensuring their continued effectiveness.
In the fnancial year under review, the internal audit
function of the Trust was carried out by KPMG.
Staffed by qualifed executives, KPMG has unrestricted
access to the AC. KPMG reports to the Chairman of the
AC and is guided by the Standards for the Professional
Practice of Internal Auditing.
During the year, KPMG adopted a risk-based auditing
approach covering fnancial, operational and compliance
controls. Internal audits were carried out on all the asset
companies of the Trust. Internal audit reports were
submitted to the AC for review and the summary of
fndings and recommendations were discussed at the AC
meetings.
The AC has reviewed the internal audit function in
the fnancial year under review and is satisfed of its
adequacy and independence from the activities it audits.
Directors’ opinion on internal controls
The Chief Executive Offcer and the Chief Financial
Offcer have provided their confrmation to the Board
that to the best of their knowledge, the system of risk
management and internal controls is adequate, the
fnancial records have been properly maintained and
the fnancial statements give a true and fair view of
the Trust’s and the Trustee-Manager’s operations
and fnances.
The Board recognises the importance of sound
internal controls and risk management practices to
good corporate governance. The Board affrms its
overall responsibility for systems of internal controls
and risk management of the Trust and its subsidiaries,
and for reviewing the adequacy and integrity of those
systems on an annual basis. The internal control and risk
management functions are performed by key executives
and are reported to the AC for review.
The internal control systems include the safeguarding of
assets, the maintenance of proper accounting records,
the reliability of fnancial information, compliance with
appropriate legislation, regulations and best practices,
and the identifcation and containment of business risks.
Such systems are designed to manage rather than to
eliminate the risk of failure to achieve business objectives
and provide only reasonable, and not absolute, assurance
against material misstatement of loss. The Board also
notes that all internal control systems contain inherent
limitations and no system of internal controls can provide
absolute assurance against the occurrence of material
errors, poor judgment in decision-making, human error
losses, fraud or other irregularities.
Corporate governance report