Annual report 2010

10. Internal Control and Risk Management SystemOrganization of the internal controland risk management systemIn 2010, the Company continued to work toimprove and develop the internal control and riskmanagement system (hereinafter, “ICRMS”). TheBoard of Directors approved local regulationsaimed at developing internal control and riskmanagement: the Concept of Developing andImproving the Internal Control and Audit Systemand the Risk Management System, the RiskManagement Policy, the Internal Control Policy,the Guidelines for Organizing Internal Control andRisk Management. The development of ICRMS followsthe path toward establishing preventive controlprocedures and improving the risk managementprocedure.The processes of ICRMS involve the managers andemployees of JSC IDGC Holding and its SDCs at allmanagerial levels. The Board of Directors of theCompany sets direction for the development ofICRMS, approves local regulations underlying thesystem. Responsibility for the efficiency of ICRMSand the implementation of local ICRMS regulationsis entrusted to the Management Board andCEO. The establishment and implementation ofrisk-oriented control procedures and risk managementactivities as well timely risk identificationand assessment are entrusted to the managers ofcore functions. The efficiency of ICRMS is monitoredand assessed by the Internal Audit and RiskManagement Department.In the future, the Company plans to continue todevelop ICRMS, optimizing control environmentfor the Company’s business-processes, improvingrisk management processes and automating controlprocedures and risk management processes.The activities of JSC IDGC Holding are exposed toseveral risk groups.79