ACN Incorporated in Australia. Risk Management Guidelines and Policy

Transcription

1 ACN Incorporated in Australia Risk Management Guidelines and Policy

2 Risk management guidelines and policy 1 Introduction recognise and manage risk This document sets out the risk management guidelines of the Company. The guidelines are intended to assist the Company to establish a sound system of risk oversight and management and internal control that will effectively: identify, assess, monitor and manage risk; and inform investors of material changes to the Company s risk profile. The Board and Senior Management will take a pro-active approach to risk management, ensuring that a Company wide system is in place which addresses all material internal and external risk factors facing the Company, which includes: financial; legal and regulatory; operating; and commercial risks, including health, safety and environment. 2 Risk management policy The Company has an Audit and Risk Management Committee (Committee) which is an integral part of the Company s governance structure. The Committee strives to ensure that the Board, directors and the management are aware of all material actual and potential risks facing the business and that a system to identify, monitor and assess those risks is implemented and regularly monitored and reviewed. 2.1 Role and responsibilities of the Committee The Committee is responsible for identifying the risks that face the Company. These will include both internal and external risks. The Board is responsible for: establishing the Committee and implementing the risk management system; overseeing the activities of the Committee; and at least annually, reviewing the effectiveness of the implementation of the risk management system. 2.2 Risk management The Board expects that the Committee will provide periodic reports of the results of the risk management process to the Board and relevant management. In particular the Board anticipates that the Committee will: research and review reference materials and background information relating to risk management in the Company s industry as a basis to assess whether or not the process used by the Company is appropriate and represents the best practices for the industry; research and review current developments, trends, industry information related to the business conducted by the Company and other sources of information to determine risk and exposure that may affect the Company; RISK MANAGEMENT GUIDELINES AND POLICY PAGE 1

3 (e) (f) (g) (h) (i) (j) review corporate policies, the Board and Audit Committee members meeting minutes to determine the Company s business strategies, risk management philosophy and methodology, appetite for risk and acceptance of risks; review previous risk evaluation reports by management, internal and external auditors; compile information to evaluate the effectiveness of risk litigation monitoring and communication of risks; review the adequacy and timeliness of recording of risk management results; review the completeness of management s risk analysis and actions taken to remedy issues raised by the risk management process; determine the effectiveness of management s self-assessment process; review risk related issues that may indicate weakness in risk management practices; and formulate a formal Board risk management policy for future use in assessing and monitoring and responding to risk. 2.3 Compliance and control The Committee is responsible for establishing and implementing a system for identifying, assessing, monitoring and managing material risk throughout the Company. 2.4 Risk management statement One critical component of the Company s risk management system is the management of financial risk. A critical control of financial risk is financial reporting. The integrity of the Company s financial reporting relies upon a sound system of risk management and control. Accordingly, the chief executive officer and chief financial officer, to ensure management accountability, are required to provide the statement in annexure 1 stating that the financial reports of the Company are based upon a sound risk management policy. 2.5 Internal control and risk management The Committee has overall responsibility for the Company s internal control environment, and must strive to ensure that: The Company has an integrated framework of control, based on formal procedures and appropriate delegation of authority and responsibility; There is a disciplined approach to identification and management of risk; Management has established and implemented a system for identifying, assessing, monitoring and managing material risk through the Company; and These systems include internal compliance and controls. The Board Oceana Gold Limited December 2004 RISK MANAGEMENT GUIDELINES AND POLICY PAGE 2

4 Annexure 1 Statement of confirmation financial report (including risk management) [OceanaGold letterhead] The Directors Oceana Gold Limited ACN Financial reports We submit for your approval the financial report for the financial [year/half year] of the Company that ended [insert date]. The Company has prepared the financial report in accordance with section [295 (annual)/303 (half-yearly)] of the Corporations Act 2001 (Cth). As managing director and chief financial officer respectively of the Company, we confirm, subject to the Qualifications and Assumptions (if any) noted below, to you that to the best of our information, knowledge and belief, each of us having made reasonable enquiries and reasonably relied on the auditor s report prepared under section [308 (annual)/309 (half-yearly)] of the Corporations Act: 1 the Company s financial records have been properly maintained in accordance with section 286 of the Corporations Act; 2 the Company s financial statements (including any notes to the financial statements required by the relevant accounting standards) comply with the relevant accounting standards as required by section 296 (annual)/304 (half-yearly)] of the Corporations Act; and 3 the Company s financial report presents a true and fair view in all material respects of the Company s financial position and performance in accordance with section [297 (annual)/305 (half-yearly)] of the Corporations Act. Risk management, internal compliance and control In the same capacity each of us confirms (subject to any assumptions of qualifications noted below) that the financial report is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the board, and that the Company s risk management and internal compliance and control system is operating efficiently and effectively in all material respects. Assumptions [insert if any] RISK MANAGEMENT GUIDELINES AND POLICY PAGE 3

5 Qualifications [insert if any] Director and Chief Executive Officer Name of Director and Chief Executive Officer Chief Financial Officer Name of Chief Financial Officer Date: RISK MANAGEMENT GUIDELINES AND POLICY PAGE 4