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20
CONTINGENT LIABILITIES AND FACILITIES
Legal costs and litigation:
In the nature of the CSIR’s business, agreements with complex deliverables may be entered into. All necessary steps are
taken to manage the risks inherent to these transactions. If and when it is evident that there is a reasonable probability
that a dispute on a transaction could lead to costs against the CSIR, such costs will be disclosed.
21
22
FINANCIAL INSTRUMENTS
GROUP
CSIR
2011 2010 2011 2010
R’000 R’000 R’000 R’000
Facilities of subsidiaries guaranteed by the CSIR 20 000 20 000 20 000 20 000
CAPITAL COMMITMENTS
Property, plant and equipment 9 337 7 770 9 337 7 770
This capital expenditure is to be fi nanced from internal sources.
The Group has exposure to the following risks from its use of fi nancial instruments:
• market risk
• credit risk
• liquidity risk.
This note presents information about the Group’s exposure to each of the above risks and the Group’s objectives,
policies and processes for measuring and managing risk. Further quantitative disclosures are included throughout these
consolidated fi nancial statements.
The Board has overall responsibility for the establishment and oversight of the Group’s risk management framework.
The Group’s risk management policies are established to identify and analyse the risks faced by the Group, to set
appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems
are reviewed regularly to refl ect changes in market conditions and the Group’s activities. The Group, through its training
and management standards and procedures, aims to develop a disciplined and constructive control environment in
which all employees understand their roles and obligations.
The Audit and Risk Committee oversees how management monitors compliance with the Group’s risk management
policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced
by the Group. The Group Audit and Risk Committee is assisted in its oversight role by Internal Audit. Internal Audit
undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are
reported to the Audit and Risk Committee.
153
ANNUAL FINANCIAL STATEMENTS