Goldis Berhad Annual Report 2009

STATEMENT OF INTERNAL CONTROL
The Board is responsible for the Group’s system of internal
control and for reviewing its adequacy and integrity. Its
review covers financial, operational and compliance
controls and risk management. The system of internal
control is designed to manage rather than eliminate the
risk of failure to achieve business objectives, and can only
provide reasonable and not absolute assurance against
material errors, misstatement, losses or fraud.
For joint ventures and associated companies, its respective
management has an existing monitoring function to assist
them in ensuring the system of internal control is functioning
as intended. The Management of Goldis Berhad believes
that the system of internal control of these companies is
adequate through regular performance reviews.
RISK MANAGEMENT
The Board recognises that risk management is an integral
part of the system of internal control and good management
practice that strengthens the business planning processes.
There is an on-going and systematic risk management
process undertaken by Management to identify, assess and
evaluate principal risks and to ensure that appropriate risk
treatments are in place to mitigate those risks affecting the
achievement of the Group’s business objectives.
Management reports regularly on the management of risks
to the Chairman/Group Chief Executive Officer, whose
main role is to assess, on behalf of the Board, the key risks
inherent in the business and the system of controls
necessary to manage such risks. Any significant changes in
the business and the external environment which may result
in significant risks will be reported to the Audit Committee
and Board accordingly.
OTHER KEY ELEMENTS OF INTERNAL CONTROL
SYSTEM
The other key elements of the Group’s internal control
system include:
Clearly defined lines of responsibility and delegated
authority
The Group has an organisational structure which clearly
defines the responsibilities and reporting lines including
relevant authorisation levels.
Management Meetings
The Chairman/Group Chief Executive Officer meets
periodically with the Group’s departmental heads to share
information, monitor the progress of various business units,
and to deliberate and decide upon operational matters, and
with the respective business unit Chief Executive Officer to
review the business unit financial performance, business
development, management and corporate issues.
Budget
The Annual Budgets and Revised Budgets are prepared by
each operating company in the Group and are submitted
to the Board for approval. It provides the Board with
comparative information to assess and monitor performance
of the Group.
Internal Audit
The Group Internal Audit Department reports directly to
the Audit Committee of the Group functionally to preserve
the independence of the function. The internal audit work
is focused on areas of priority as identified by risk analysis
in accordance with its annual audit plan as approved by
the Audit Committee.
Best Practices in Internal Control
An internal control best practice has been established for
key areas and has been distributed to each subsidiary for
adoption. Each subsidiary will review and ensure that the
internal control best practices are incorporated into their
existing Standard Operating Procedures.
Information and Communication
The Management Information Systems provide the Board
with relevant and timely reports for monitoring the financial
performance and the business operation of the Group.
MONITORING
The Board reviews the effectiveness of the system of
internal control of the Group at periodic Board meetings and
the system of internal control will continue to be reviewed,
enhanced and updated in line with the changes in the
operating environment.
The Board is pleased to report that there were no material
internal control system failures nor have any of the reported
weaknesses resulted in material losses or contingencies
during the financial year.
This statement was made in accordance with the resolution
of the Board of Directors passed on 25 March 2009.
Goldis Berhad (515802-U)
annual report 2009
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