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94 | S P SETIA BERHAD GROUP | Annual Report 2014

• There is strategic planning, annual budgeting and target-setting process, which include forecasts for each area of business with

detailed reviews at all levels of operations.

• Actual performance compared with budget is reviewed with detailed explanation provided for any major variances.

• The President/Chief Executive Officer, Deputy President/Chief Operating Officer and Executive Vice Presidents meet on a monthly

basis with all Divisional Heads and Business Unit Heads to discuss on the Group’s financial performance, business development,

management issues and corporate issues.

• Standard Operating Procedures which include policies and procedures within the Group are continuously reviewed and updated.

• The Divisional Heads and Business Unit Heads are responsible for the identification and evaluation of significant risks applicable to

their areas of business together with the design and operation of suitable internal controls.

• Corporate values, which emphasise ethical behaviour are set out in the Group’s Employee Handbook.

The Group’s system of internal control does not apply to Associate Companies and Jointly Controlled Entities where the Group does not have

full management control over them. However, the Group’s interest is served through representations on the Board of the respective Associate

Companies and Jointly Controlled Entities.

Assurance From Management

The Board has also received reasonable assurance from the President/Chief Executive Officer and Chief Financial Officer that the Group’s risk

management and internal control systems are operating adequately and effectively, in all material respects, based on the risk management

framework adopted by the Group.

Review of The Statement by External Auditors

The external auditors have reviewed this Statement on Risk Management and Internal Control for inclusion in the annual report for the financial

year ended 31 October 2014. Based on their review, the external auditors have reported to the Board that nothing had come to their attention

that causes them to believe that the Statement on Risk Management and Internal Control is inconsistent with their understanding of the

processes the Board has adopted in the review of the adequacy and integrity of the risk management and internal control of the Group.


IV. Corporate Governance