STAMFORD TYRES CORPORATION LIMITED
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DRIVING IT UP
The Board is cognizant of its responsibility for maintaining a sound system of internal controls to safeguard the
investment of its shareholders and the assets and business of the Group. The internal audit function is outsourced
to an external professional firm. The Internal Auditor conducts regular audit of internal control systems of the
Group’s companies, recommends necessary improvements and enhancements, and reports directly to the AC.
The AC examines the effectiveness of the Group’s internal control systems. The many assurance mechanisms
operating are supplemented by the Internal Auditor’s reviews of the effectiveness of the Group’s material internal
controls, including financial, operational and compliance and information technology controls. Any material non-
compliance or failures in internal controls and recommendations for improvements are reported to the AC. The
AC reviews the effectiveness of the actions taken by Management on the recommendations made by the Internal
Auditors in this respect.
In addition, the Group has set up an executive Risk Management Committee (“RMC”) to oversee that
appropriate risk management policies are put in place and there are processes to evaluate the risks monitored
under the ERM framework. The RMC, comprising members of the Senior Management team, is responsible for
setting the direction of corporate risk management and monitoring the implementation of risk management
policies and procedures.
The RMC has established an enhanced risk management policy to provide guidance to Management on key risk
parameters. The significant risks in the Group’s business, including mitigating measures, were also reviewed by the
RMC and reported to the AC and the Board. Risk registers are maintained by the business and operational units
which identify the key risks facing the Group’s business and the internal controls in place to manage those risks.
These risks have been categorized as strategic, operational, financial or compliance risks and the main areas of
financial risk, faced by the Group are foreign currency exchange risk, interest rate risk, credit risk and liquidity risk.
The RMC together with the President and Group Financial Controller have confirmed to the AC and the Board
the adequacy and effectiveness of the risk management system and internal controls.
The AC, with the assistance of the Internal and External Auditors, reviews and reports to the Board on the
adequacy of the Company’s system of internal controls, including financial, operational, compliance and
information technology controls and taking into consideration the risk management perspective.
The AC may examine whatever aspects it deems appropriate of the Group’s financial affairs, its internal and
external audits and its exposure to risks of a regulatory or legal nature. It keeps under review the effectiveness of
the Company’s system of accounting and internal financial controls, for which the directors are responsible. It also
keeps under review the Company’s programme to monitor compliance with its legal, regulatory and contractual
obligations.
The Board has received written assurance from the President and Group Financial Controller:
(a)
that the financial records have been properly maintained and the financial statements give true and fair
view of the Group’s operations and finances; and
(b)
regarding the effectiveness of the Group’s risk management and internal control systems.
Corporate Governance
(Cont’d)
