Full Annual Report 2006 - Singapore Technologies Engineering

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41 Corporate Governance Internal Controls (Principle 12) Internal Audit (Principle 13) The AC oversees and appraises the quality of the audit effort of the Company’s IA function. The Board, through the AC, the President and CEO and the CFO, considers that the Group’s framework of internal controls and procedures is adequate to provide reasonable assurance of the integrity, confidentiality and availability of critical information, and the effectiveness and efficiency of operations, safeguarding of assets and compliance with applicable rules and regulations. It is also satisfied that problems are identified on a timely basis and there is in place a process for best practices and follow up actions to be taken promptly to minimise unnecessary lapses and for the identification and containment of business risks. The IA supports the AC in reviewing the adequacy of the Company’s internal control system. Staffed by qualified auditors, IA has unrestricted direct access to the AC. The Head of IA’s primary line of reporting is to the Chairman of the AC, although he reports administratively to the CFO of the Company. IA plans its internal audit schedules in consultation with, but independently of, management and its IA Plan is submitted to the AC for approval at the beginning of each year. The AC also meets with IA at least once a year without the presence of management to gather feedback on management’s level of cooperation and other matters that warrant AC’s attention. All audit reports are submitted to the AC for deliberation with copies of these reports extended to the relevant senior management, for prompt corrective actions, as recommended. Furthermore, IA’s summary of findings, recommendations and updates on management’s actions taken are discussed at the quarterly AC meetings. There were no significant control issues highlighted by IA in 2006. During the year, IA briefed the AC on its plan to carry out surprise audits across the Group. The IA continued with its system of rating a company at the end of an internal audit for the purpose of differentiating the high risk issues which require more serious attention. As part of the Group’s effort to continually improve on its control framework, IA has also introduced a quarterly Control Self Assessment Declaration for all auditable entities to sign off and declare that Management has reviewed and complied with all the requirements and that there are no material matters or issues that have not been highlighted. On an ongoing basis, IA ensures that good practices are shared within the Group. Risk Management The Risk Review Committee, chaired by Mr Winston Tan, comprises LG Ng Yat Chung, Mr Lucien Wong, Mr Venkatachalam Krishnakumar, Mr Tan Pheng Hock and Mr Chang See Hiang, a co-opted member and Board Director of ST Aerospace. The Committee oversees the risk management framework and reviews key risk exposures, including business continuity management. The Committee met four times during the year to review the key risks and the measures put in place as well as the key risk indicators of each sector. Emerging risk perspectives facing the Group were also discussed. Budget and Finance Chaired by Mr Lucien Wong, the Budget and Finance Committee members include Mr Tan Pheng Hock, Mr Quek Poh Huat and Dr Tan Kim Siew. Budgets prepared by the respective subsidiaries are consolidated at the ST Engineering level and presented to the Budget and Finance Committee for review and recommendation to the Board for approval. During the year, the Budget and Finance Committee held three meetings to review the FY2006 budget assumptions and forecast. The Committee also met to review the 2007 Plan and recommended to the Board for approval.
THE WINNING SPIRIT ST Engineering AR 2006 42 Corporate Governance Business Investment and Divestment Committee The Business Investment and Divestment Committee comprises Mr Peter Seah as Chairman, Mr Tan Pheng Hock, LG Ng Yat Chung, Mr Winston Tan and Mr Quek Poh Huat. During the year, the Business Investment and Divestment Committee held two meetings to consider major investments by the Group. Communication with Shareholders (Principle 14) Greater Shareholder Participation (Principle 15) The Group has a comprehensive investor programme aimed at providing existing and potential investors with comprehensive and prompt information to enable them to have a better understanding of the Group’s businesses, direction and performance. ST Engineering maintains a regularly updated website which provides a chronology of the latest press releases and highlights of corporate events of each of its sectors and their respective capabilities. Board members attended the AGM and EGM in 2006 where shareholders present were given an opportunity to seek clarification or question the Board on issues pertaining to the resolutions proposed before they were voted on. The external auditors were also present at the AGM to assist the directors in answering questions on audit related matters from shareholders. The Group fully supports the Code’s principle to encourage active shareholder participation. More on Investor Relations can be found on pages 46 to 49. Financial and other information are made available on the Company’s website at http://www.stengg.com and these are regularly updated. In 2006, ST Engineering hosted more than 300 investor meetings, including participation in 11 international investor roadshows and conferences in 25 cities. ST Engineering is committed to timely disclosures to ensure that the investing community receives a balanced and updated view of the Group’s performance and businesses.
Page 1 and 2: THE WINNING SPIRIT ANNUAL REPORT 20
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99 Directors’ Report AS AT 31 DEC
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101 Directors’ Report AS AT 31 DE
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105 Balance Sheets AS AT 31 DECEMBE
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197 SGX Listing Manual Requirements
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199 Shareholding Statistics AS AT 5
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201 SECTORAL FINANCIAL REVIEW - AER
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205 SECTORAL FINANCIAL REVIEW - ELE
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221 Group Structure - Singapore Tec
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223 Group Structure - Singapore Tec
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225 CORPORATE INFORMATION BOARD OF
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SINGAPORE TECHNOLOGIES ENGINEERING
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Full Annual Report 2006 - Singapore Technologies Engineering

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