Download full circular PDF - Anglo American Platinum

APPENDIX 8CORPORATE GOVERNANCE AND KING CODECORPORATE GOVERNANCE – DIRECTORS’ RESPONSIBILITIES IN RESPECT OF ANNUALFINANCIAL STATEMENTSThe Directors are required by the South African Companies Act to maintain adequate accounting recordsand to prepare annual financial statements that fairly present the state of affairs of the Group and theCompany as at the end of the financial year and the profit or loss for that year. Furthermore, in order toachieve fair presentation, the financial statements are drawn up to comply with International FinancialReporting Standards and South African Statements of Generally Accepted Accounting Practice. Thefinancial statements are the responsibility of the Directors and it is the responsibility of the independentauditors to report thereon.To enable the Directors to meet these responsibilities, the Board sets standards and implements systems ofinternal control aimed at reducing the risk of error or loss in a cost-effective manner. The controls include theproper delegation of responsibilities within a clearly defined framework, effective accounting procedures,and adequate segregation of duties, ensuring an acceptable level of risk. These controls are monitoredthroughout the Group and all employees are required to maintain the highest ethical standards in ensuringthat the Group’s business is conducted in a manner that in all reasonable circumstances is above reproach.Particulars relating to the Group’s internal controls and audit approach, embracing the role and function ofthe Audit Committee, are set out in the section on corporate governance in the Sustainable DevelopmentReport, dated 31 December 2003. The audit approach entails a thorough comprehension of the Group’sfinancial and business objectives, and analysis of the underlying systems and procedures.The focus of risk management in the Group is on identifying, assessing, managing, and monitoring all knownforms of risk across the Group. While operating risk cannot be fully eliminated, the Group endeavours tominimise it by ensuring that the appropriate infrastructure, controls, systems, and ethics are appliedthroughout the Group and managed within predetermined procedures and constraints.The Directors are of the opinion, based on the information and explanations given by management and theinternal auditors and on comment by the independent auditors on the results of their audit, that the internalcontrols are adequate to ensure:– The reliability and integrity of financial and operating information;– The compliance of established systems with policies, plans, procedures, laws, and regulations;– The safeguarding of the Group’s assets against unauthorised use or disposition;– The economic, effective, and efficient utilisation of resources; and– The accomplishment of established objectives and goals for operations or programmes.Nothing has come to the attention of the Directors to indicate that any material breakdown in the functioningof these controls, procedures, or systems occurred during the 2003 year. Accordingly, the financial recordsmay be relied upon for preparing the financial statements and maintaining accountability for assets andliabilities.In preparing the financial statements, the Group complied with International Financial Reporting Standardsand used appropriate accounting policies, supported by reasonable and prudent judgements andestimates. The Directors are of the opinion that the financial statements fairly present the financial positionof the Company and of the Group as at 31 December 2003 and the results of the operations and cash flowinformation for the year then ended. The Directors have reviewed the Group’s cash flow forecast for the yearto 31 December 2004 and, in the light of this review, the current financial position, and the expectedproceeds from this rights issue, they are satisfied that the Group has adequate resources to continue inoperational existence for the foreseeable future. For this reason, the Group continues to adopt the goingconcernbasis in preparing the annual financial statements.The Directors believe, as a result of the comprehensive structures and controls that are in place and theongoing monitoring of the activities of executive and operational management, that the Board maintainseffective control over the Group’s affairs. The internal auditors and the independent external auditors concurwith these statements by the Directors.93