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The Board has in place an on-going process for identifying,evaluating, monitoring and managing significant risks thatmay affect the achievement of business objectives ofthe Group. The processes which have been institutedthroughout the Group, except for associated companiesand joint ventures which are not under the control of theGroup, are updated and reviewed from time to time torespond to the changes in the business environmentthroughout the financial year under review. The Board isassisted by the Management in the implementation ofthe approved policies and procedures on risks andcontrols whereby Management identifies and assessesthe risks faced and then designs, implements and monitorsappropriate internal controls to mitigate and controlthese risks.The Board is of the view that the system of internalcontrols in place for the year under review and up to thedate of issuance of the financial statements is sound andsufficient to safeguard the shareholders’ investment andthe Group’s assets.RISK AND INTERNAL CONTROL FRAMEWORKThe Group has implemented policies on risk and internalcontrols to continuously identify, assess and monitorrisks by establishing a Group Wide Risk ManagementFramework and formulate an effective system of internalcontrols to mitigate the risks. The Group Wide RiskManagement Framework enables the identification,assessment and management of business risk in theoverall context of business management including theday-to-day operations, planning and strategic initiativesthroughout the Group, to provide assurance to theBoard and stakeholders. The effectiveness of the Group’srisk management policies and internal controls arereviewed on a regular basis and, where necessary,improved, both at the management level and at theBoard level. The major risks faced by the Group arelisted in Appendix 1 of this statement.The Board’s review of the Group’s internal control isbased on the criteria developed under the United StatesCOSO (Committee of the Sponsoring Organisation of theTreadway Commission) Internal Control IntegratedFramework, which is divided into five interrelatedcomponents of review that are designed to providereasonable assurance on the achievement of the Group’sobjectives. The following key internal control structuresare in place to assist the Board to maintain a properinternal control system:KEY INTERNAL CONTROL STRUCTURES OFTHE GROUP1.0 CONTROL ENVIRONMENTControl environment sets the tone for the Group byproviding fundamental discipline and structure. Keyelements of the Group’s internal control systeminclude:1.1 Integrity and Ethical Values• Code of Conduct and PracticeThe Senior Management and Board set thetone at the top for corporate behaviour andcorporate governance. All employees of theGroup shall adhere to the policies andguidelines as set out in the Code of Conductof the Group which was prepared in 2009(Code). The Code sets out principles toguide employees in carrying out their dutiesand responsibilities to the highest standardsof personal and corporate integrity whendealing within the Group and with externalparties. The Code covers areas such ascompliance with respective local laws andregulations, integrity, conduct in theworkplace, business conduct, protection ofthe Group’s assets, confidentiality andconflicts of interest.• Guidelines on Misconduct and DisciplineGuidelines have been put in place in 2009for handling misconduct and disciplinarymatters. These guidelines govern the actionsto be taken to manage the misconduct ofemployees who do not comply with theexpressed and implied terms and conditionsof employment.Axiata Group Berhad • 080