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13
Annual Report 2012
Risk Management Process
Central to the Group’s risk management
process, which addresses fnancial, operational
and compliance risks, is the Enterprise Risk
Management Framework (“ERMF”) the Group
has adopted. The ERMF sets out a systematic
process to identify, evaluate, manage and
monitor risks that may have impact on its
operations. It is through this framework
that the Board of Directors and the Audit
Commitee are given the assurance that the
management has implemented adequate
controls to safeguard the Group’s assets and
enhance shareholders’ value.
The key components of the Group’s Risk
Management process are:
a. Risk Identifcation
b. Risk Evaluation and Mitigation
c. Process and Procedure Design
d. Internal Control Design
e. Management Review
f. Internal and External Audits
Key Risks Being Monitored
Listed below are the critical risks which are being closely monitored and managed.
“The internal risk management process is augmented by independent
audits conducted by external auditors covering diferent aspects of
fnancial, operational and compliance risk management.
Steps (a) to (d) are encapsulated in the ERMF
which is an on-going process that regularly
updates and enhances the overall control
environment. The main forum for step (e) is the
monthly management meeting. Signifcant and
critical risk issues are regularly reviewed and
monitored by the management team either
at the monthly management meetings or at
forums specifcally convened (e.g. Work Health
and Safety Commitee).
The internal risk management process is
augmented by independent audits conducted
by external auditors covering diferent aspects
of fnancial, operational and compliance
risk management. In addition to the annual
statutory audit conducted by the external
auditors, internal audits conducted in
accordance with the IIA standards are also
performed by external professional frms.
There are also regular audits conducted for
industrial accreditation as well as customer
quality controls performed by independent
parties to ensure compliance of the various
regulations, standards and guidelines.
RISK
MANAGEMENT
Financial Risks Operational Risks Compliance Risks
Liquidity Risk
Credit Risk
Foreign Currency Risk
Concentration of Customers
Work Health and Safety
Business Continuity
Industrial Accreditation
SGX, Legal and Tax Regulations
Risk Management /