(formely M-Cell Limited) - Business Report 2003 - MTN Group

Risk management report
(continued)
connection to the Internet. It was also the first
operator to offer a high-speed circuit-switched
data (HSCSD) platform. Mobile data for the
business market is expected to become an
increasingly important contributor to the
revenues of mobile operators. These
innovations have enabled the Group to launch
pioneering data applications for the business
market.
Country risk
Country risk arises when events or
developments in foreign countries in which the
Group has invested threaten to erode or
destroy the value of those investments. Such
events could be the imposition of exchange
controls, political instability or insufficient
foreign exchange. Country risk of this nature
and exposure to political risk are thoroughly
explored and analysed during the preinvestment
feasibility or due diligence studies
and are factored into the equation of risk and
reward.
Management continually monitors economic
and political data and engages the services of
the London-based Control Risks Group to
assist in assessing country risk. The Group has
also taken out political risk insurance to cover
part of its total equity investment in the
various international operations.
Conclusion
Risk management is effectively aligned with
performance management in practically all
respects and should cover all operational
issues. The underlying objectives are to
maximise long-term shareholder value, to
protect the Group’s assets and people, and the
environment, as well as to enhance the Group’s
reputation and brand name.
INTERNAL AUDIT
The Board has established a Group internal
audit function which reports to the Group
Chief Executive Officer and Group Audit
Committee. All operating subsidiaries have
also appointed internal audit departments,
which report to their respective chief executives
and audit committees, while maintaining a
strong reporting line to Group internal audit.
Internal audit work is primarily risk based
and will be tailored to meet the assurance
requirements following completion of the
risk profile.
The internal audit function, acting under the
direction of the Board, enables the directors to
fulfil their responsibilities and maintain the
systems of control that reduce the risk of error
or loss. It acts independently to appraise the
effectiveness of internal systems of control in
the light of an intimate knowledge of the
Group’s financial and business objectives,
systems and procedures.
The internal audit function, acting under the
direction of the Group Audit Committee,
determines the audit plan on an annual basis,
based on the relative degree of inherent risk of
the Group’s operations. It seeks to enhance the
effectiveness of the internal audit process by
continually developing audit standards and
methodologies and by conducting ongoing
skills training and development programmes.
PAGE 52
MTN BUSINESS REPORT 2003