Annual Report 2010-2011 - Colombo Stock Exchange

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Risk Management Risk Exposure Group Objectives Risk Minimization Strategies 2. Asset Risk • To minimize risk from fire, theft and machinery and equipment breakdown. 3. Internal Controls • To maintain a sound system of internal control to safeguard shareholders’ wealth and Group assets. 4. Reputation Risk • To prevent the causes that damage our reputation. • To minimize the impact if, despite our best endeavors, a reputation crisis should occur. 5. Human Capital and Labour Risk • To ensure a smooth flow of operations without any undue disruptions. • To project our self as a human employer, successful in motivating, developing, retaining and attracting the best of human capital. 6. Technological Risk • To keep pace with the current technological developments and safeguard against obsolescence • Obtaining comprehensive insurance covers for all tangible assets. • Adoption of stringent procedures with regards to the moving of assets from one location to another. • Carrying out mandatory preventive maintenance programs. • Carrying out frequent employee training programs in areas such as fire prevention. • Carrying out of system audits and other control mechanisms such as inventory and cash counts throughout the Group by our central Internal Audit Department. • Having in place a budgetary process and a budgetary control mechanism on a monthly basis to ensure that the Group’s performance is in line with its targets. • Adopting stringent quality assurance policies with regard to goods bought out from third parties as well as the inputs, processes and outputs of own brand and in-house manufactured products. • Ensuring effective communication with various stakeholders including employees, bankers, media, regulators, customers, suppliers, shareholders and the community at large. • Providing the front line managers and the sales staff with adequate training in order to improve service standards as well as to educate staff on the importance of customer service. • Maintaining healthy relationships with trade unions through regular dialogue. • Entering into collective agreements with trade unions. • Improving employee benefits by way of financial incentives and welfare activities. • Improving the Human Resource function of the Group with regards to employee recruitment, performance appraisals and in-house as well as external training programs. • Continuous investment in new machines. • Investing in Research and Development activities throughout the year. • Investing in hardware and developing software inhouse. • Continuous improvement on safeguarding IT and related assets. Richard Pieris and Company PLC | Annual Report 2010/2011 42
Risk Management Risk Exposure Group Objectives Risk Minimization Strategies 7. Procurement Risk • To minimize risk associated with price and availability. 8. Inventory • To reduce stock obsolescence and manage stock holding costs. • Reducing the risk associated with theft and shrinkage 9. Risk of Competition • To maximize our market share and maintain market leadership in the respective industries. 10. Intellectual Capital Risk 11. Capital Investments Risk • To protect ourselves against possible violations, fraudulent usage and infringements on the Group’s copyrights. • To minimize risk of not meeting profit expectations. • Developing new products to improve quality and manage costs. • Establishing relationships with many global and local suppliers for raw materials and commodities in order to reduce over-dependency on a single supplier/ brand. • Ensuring effective category management to reduce the risk of non-availability of goods at our retail outlets. • Adoption of backward integration strategies. • Centralized purchasing division which has enabled us to create a reliable network of global suppliers. • Entering into forward contracts for raw material purchases. • Adopting a monthly declaration policy. • Identifying slow-moving stocks and effectively laying out a channel for these to be sold off. • Adopting security systems at the Retail outlets such as security tags with alarm systems, surveillance cameras and deployment of security to manage theft. • Ensuring high standards of quality in the eyes of the customer. • Increasing productivity and efficiency in order to ensure our prices remain competitive despite increasing wage, energy and transportation costs. • Carrying out Research and Development activities to identify needs. • Further strengthening our Arpico brand through aggressive advertising campaigns and target marketing. • Introducing pioneering products. • The introduction of a CRM program in our retail chain. • The provision of various value added services at our key retailing outlets. • Registering our brands and trade marks. • Successfully obtaining patents for manufactured radial tyres. • Furthering our Arpico brand image through promotions and advertising. • Adopting a stringent approval procedure for Capital expenditure based on the level of investment and the expected pay back. • Carrying out extensive feasibility studies for large scale investments. External expertise is obtained wherever required. 43 Annual Report 2010/2011 | Richard Pieris and Company PLC
Page 1: Richard Pieris & Company PLC Annual
Page 4 and 5: 4 Financial Highlights 5 Corporate
Page 6 and 7: Financial Highlights 2010/2011 2009
Page 8 and 9: Chairman’s Review Need Image Rich
Page 10 and 11: Chairman’s Review It gives me gre
Page 12 and 13: Chairman’s Review Retail The reta
Page 14 and 15: The Board of Directors [1] Dr. Sena
Page 16 and 17: Sector Review - Retail Retail The s
Page 18 and 19: Sector Review - Retail Special even
Page 20 and 21: Sector Review - Plantations The yea
Page 22 and 23: Sector Review - Plantations Organiz
Page 24 and 25: Sector Review - Tyre The Tyre Secto
Page 26 and 27: Sector Review - Plastics Plastics T
Page 28 and 29: Sector Review - Plastics traffic co
Page 30 and 31: Sector Review - Rubber The Group’
Page 32 and 33: Sector Review - Service and Other S
Page 34 and 35: Sector Review - Service and Other T
Page 36 and 37: Corporate Social Responsibility A C
Page 38 and 39: Financial Review Geographical Turno
Page 40 and 41: Financial Review Minority Interest
Page 42 and 43: Financial Review Capital Structure
Page 46 and 47: Risk Management Risk Exposure Group
Page 48 and 49: Our People Another key factor in th
Page 50 and 51: Group Structure PLASTISHELLS LIMITE
Page 52 and 53: Group Structure ASIAN ALLIANCE INSU
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Page 58 and 59: Corporate Governance The Board of D
Page 60 and 61: Report of the Remuneration Committe
Page 62 and 63: Statement of Directors’ Responsib
Page 64 and 65: Balance Sheet Group Company As at M
Page 66 and 67: Cash Flow Statement Group Company 2
Page 68 and 69: Statement of Changes in Equity Attr
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Notes to the Financial Statements C
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Ten Year Summary Net Turnover Rs. m
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Shareholder Information The Ordinar
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Group Real Estate Portfolio Freehol
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Glossary of Financial Terms Contd.
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Notes Contd. Richard Pieris and Com
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Notice of Meeting NOTICE IS HEREBY
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Form of Proxy Contd. INSTRUCTIONS A
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Richard Pieris & Company PLC 310, H
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Annual Report 2010-2011 - Colombo Stock Exchange

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