IBRC annual report for 2011 - Irish Bank Resolution Corporation ...

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Corporate governance statement continued• Commissioning and reviewing reports on key riskissues;• Review and oversight of management’s plans formitigation of the material risks faced by the variousbusiness units of the Group; and• Oversight of the implementation and review of riskmanagement and internal compliance and controlsystems throughout the Group.The Group Risk function provides a risk report to each meetingof the Committee which addresses the material risk types towhich the Group has exposure including credit, liquidity andmarket risk. The Group Compliance function also provides areport to the Committee’s meetings which addresses allmaterial compliance matters. In addition, the Group Legalfunction provides a regular review on all material litigationmatters involving the Bank. The Committee also receivesupdates from various Heads of Business functions on a regularbasis to enhance its understanding of the risks facing thosedifferent business units and the actions being taken to managethose risks.At the invitation of the Committee, there are a number ofadditional standing attendees at each meeting including theChief Financial Officer, Chief Risk Officer and the Head ofGroup Internal Audit.Nomination and Governance CommitteeMembers at 31 December 2011:Aidan Eames (Chairman), Mike Aynsley, Dr. Noel Cawley,Alan Dukes, Maurice Keane and Gary Kennedy.The Nomination and Governance Committee is responsible for:• Leading the process for appointments and renewalsto the Board and Board sub-committees andreviewing senior management succession plans,making recommendations to the Board, asappropriate;• Overseeing the process for appointments andrenewals of the Boards of subsidiary entities,including regulated subsidiaries; and• Monitoring developments in corporate governance,assessing the implications for the Bank, overseeingadherence by the Bank and its group of companiesto applicable governance requirements and advisingthe Board accordingly.Internal controlThe Directors acknowledge their overall responsibility for theGroup's system of internal control and for reviewing itseffectiveness, including having an appropriate process in placefor the preparation of Group Accounts. The Board hasdelegated to the Group Executive Committee the planning andimplementation of the system of internal control within anappropriate established framework which applies across theGroup. The system is designed to manage rather thaneliminate the risk of failure to achieve the Group's businessobjectives and provides reasonable but not absolute assuranceagainst material financial misstatement or loss. Such lossescould arise due to the nature of the Group's business inundertaking a wide range of financial services that inherentlyinvolve varying degrees of risk.The Group's system of internal control includes:• An organisation structure with clearly definedauthority limits and reporting mechanisms to seniorlevels of management and to the Board;• Divisional managers who, in conjunction with theGroup Risk and the Group Compliance functions,have responsibility for ensuring that risks areidentified, assessed and managed throughout theGroup. The Group Risk function together with theGroup Asset and Liability Committee providessupport to the Audit Committee and the Risk andCompliance Committee;• An independent Group Finance function, under theleadership of the Chief Financial Officer, which hasresponsibility for managing the process in respect ofthe preparation of group accounts, having regard toapplicable regulatory, legislative and financialaccounting requirements;• An annual budgeting and monthly financialreporting system for all Group business units whichenables progress against plans to be monitored,trends to be evaluated and variances to be actedupon;• A set of policies and guidelines relating to credit riskmanagement, asset and liability management(including interest, currency, and liquidity andfunding risk), compliance, operational riskmanagement, capital expenditure, computersecurity and business continuity planning; and• A Code of Conduct setting out the standardsexpected of all Directors, officers and employees ofthe Group.Procedures for monitoring the effectiveness of internal controlsinclude internal audit reports which are considered by theAudit Committee with an overview report provided by theHead of Internal Audit to meetings of the Committee,reporting by Group Risk and Group Compliance to the Risk andCompliance Committee meetings, and an annual assessmentby the Board of the effectiveness of internal controls.The Head of Group Internal Audit reports directly to theChairman of the Audit Committee and administratively to theGroup Chief Executive. The system of internal control isreviewed by Group Internal Audit. Emphasis is focused onareas of greatest risk as identified by risk analysis. The internalcontrol systems are subject to regulatory supervision by theCentral Bank of Ireland and overseas regulators.The Board confirms that there is a framework in place (which isdescribed in note 50) for identifying, evaluating and managingthe significant risks faced by the Group including compliancewith relevant law and regulation. This framework is regularlyreviewed and is in accordance with the Financial ReportingCouncil Revised Guidance on Internal Control (’the Turnbullguidance’).28
Corporate governance statement continuedIrish Bank Resolution Corporation LimitedAnnual Report & Accounts 2011The Directors confirm that they have reviewed theeffectiveness of the Group's system of internal controls for theyear ended 31 December 2011 and for the period up to andincluding the date of approval of the financial statements. Thereview undertaken covers all aspects of control includingfinancial, operational and compliance controls and riskmanagement. Any weaknesses identified from this review willbe addressed by the Directors.Going concernThe Directors confirm that they are satisfied that the Bank andthe Group have adequate resources to continue to operate forthe foreseeable future and are financially sound, as describedin note 1.2. For this reason, they continue to adopt the goingconcern basis in preparing the financial statements.Annual General MeetingFollowing the nationalisation of the Bank and the transfer of allshares to the Minister the provisions of the UK CorporateGovernance Code relating to shareholder relations andconduct at the Annual General Meeting are no longerapplicable.The Group uses its internet site (www.ibrc.ie) to provide thefull text of each annual and interim report for the five yearsprevious to the year of this report. The website also providesdetailed financial data, Bank information, information on creditratings and other press releases.Attendance at scheduled and unscheduled meetings during the year ended 31 December 2011.NameAlan DukesMike Aynsley (1)Maurice KeaneDr. Noel CawleyAidan EamesGary KennedyOliver Ellingham (2)Roger McGreal (3)Board -ScheduledBoard -Unscheduled Audit RemunerationRisk andComplianceNominationandGovernanceA* B* A* B* A* B* A* B* A* B* A* B*10 10 25 25 - - 5 5 - - 11 1110 10 25 25 - - - - 11 11 11 1110 10 25 23 10 10 5 5 11 11 11 1110 10 25 25 10 10 5 5 11 11 11 1110 10 25 24 10 10 5 5 11 11 11 1110 10 25 21 10 10 5 3 11 11 11 82 2 1 1 - - - - - - - -1 1 - - - - - - - - - -* Column A indicates the number of meetings held during the period the Director was a member of the Board or Committee and waseligible to attend. Column B indicates the number of meetings attended.(1) Mike Aynsley was appointed as a member of the Risk and Compliance Committee on 25 January 2011.(2) Oliver Ellingham was appointed as a Non-executive Director on 14 October 2011.(3) Roger McGreal was appointed as a Non-executive Director on 15 November 2011.29
Page 1 and 2: Irish Bank Resolution Corporation L
Page 3 and 4: ContentsIrish Bank Resolution Corpo
Page 5 and 6: Chairman’s statementIrish Bank Re
Page 7 and 8: Group Chief Executive’s reviewIri
Page 9 and 10: Group Chief Executive’s review co
Page 11 and 12: Business review continuedIrish Bank
Page 17 and 18: Board of DirectorsIrish Bank Resolu
Page 19 and 20: Corporate Responsibility continuedI
Page 21 and 22: Principal risks and uncertainties c
Page 23 and 24: Principal risks and uncertainties c
Page 25 and 26: Report of the DirectorsIrish Bank R
Page 27 and 28: Corporate governance statementIrish
Page 29: Corporate governance statement cont
Page 33 and 34: OpinionIn our opinion:• the Group
Page 35 and 36: Consolidated statement of comprehen
Page 37 and 38: Bank statement of financial positio
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Irish Bank ResolutionCorporation Li
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IBRC annual report for 2011 - Irish Bank Resolution Corporation ...

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