2007-2008 - Cgglobal.com

Internal Control Systems and their
Adequacy
Crompton Greaves has a proper and adequate
system of internal controls at all plants, divisions,
sales offices and the corporate headquarters
to ensure that its assets are safeguarded and
protected against loss from unauthorised use
or disposition and that transactions are reliably
authorised, accurately recorded and reported
quickly.
The internal control systems are defined
alongwith clear authority limits. These
systems are designed to ensure accuracy and
reliability of accounting data, for maintaining
accountability of assets, operational efficiency
and adherence to prescribed management
policy.
The Company’s internal controls are
supplemented by extensive internal audits
conducted across the entire financial year.
These are executed according to an annual
plan that is approved by the Audit Committee.
The internal audit findings are first presented
to Management; thereafter, along with the
Management’s observations, escalated to
the Audit Committee. In addition to the
usual transaction-based internal audits, the
Company’s internal audit department explores
avenues of cost control, identifies potential
financial leakages and recommends remedial
measures and deterrent actions. It also
undertakes risk based audits at its international
locations — the methodology of which is
in the process of being adopted for all the
Indian operations as well. The internal audit
departments — both in India and abroad —
regularly interact with the Company’s statutory
auditors.
In addition, prior approval is taken from the
internal audit department before effecting any
changes in authorisation in the SAP system.
The role, scope and functions of the internal
audit department are regularly reviewed by the
Audit Committee.
ASSEMBLY SHOP WITH INCREASED CAPACITY AT HT MOTORS DIVISION, MANDIDEEP
28 ANNUAL REPORT 2007–2008 CROMPTON GREAVES LIMITED