Background
The Committee presents its report for the financial year ended 30 June 2010. The Committee’s operation is guided by a formal detailed charter that is in line with the Companies Act in South Africa (the Act) and King II and is approved by the Board as and when it is amended.
It does so by evaluating the findings of internal and external audits, actions taken and the appropriateness and adequacy of the systems of internal financial and operational controls. The Committee reviews accounting policies and financial information issued to stakeholders. The chairman of the Audit and Risk Committee reports to the Board on the Committee's deliberations and decisions. The internal and external auditors have unrestricted access to the Committee.
The Committee has discharged all its responsibilities as contained in the charter.
The King Code of Governance for South Africa (King III) and its Code of Governance Principles was launched on 1 September 2009 and came into effect and replaced King II on 1 March 2010.
King III has adopted an ‘apply or explain’ approach. The Committee is in the process of reviewing its corporate governance practices with a view to complying with the requirements of the 2008 Companies Act and the King III recommendations and reporting thereon at the end of the next financial year.
Objective and scope
The overall objectives of the Committee are:
- To assist the Board in discharging its duties relating to safeguarding of assets and the operation of adequate systems and controls
- To control reporting processes and the preparation of fair presentation of the financial statements in compliance with the applicable legal requirements and accounting standards
- To provide a forum for discussing business risk and control issues and developing recommendations for consideration by the Board
- To oversee the activities of internal and external audit.
- To perform duties that are attributed to it by the Act, the JSE and King II
The Committee performed the following activities:
- Received and reviewed reports from both internal and external auditors concerning the effectiveness of the internal control environment, systems and processes
- Reviewed the reports of both internal and external auditors detailing their concerns arising out of their audits and requested appropriate responses from management
- Made appropriate recommendations to the board of directors regarding the corrective actions to be taken as a consequence of audit findings, as appropriate
- Considered the independence and objectivity of the external auditors and ensured that the scope of
their additional services provided did not impair their independence
- Reviewed and recommended for adoption by the Board the financial information that is publicly disclosed, which for the year included:
– The annual report of the year ended 30 June 2010
– The interim results for the six months ended 31 December 2010
- Considered the effectiveness of internal audit, approved the three-year operational strategic internal audit plan and monitored adherence of internal audit to its annual plan
The objectives of the Committee were met during the year under review. Where weaknesses in specific controls have been identified, management undertook to implement appropriate corrective actions to mitigate the weakness identified.
Memberships
During the course of the year, the membership of the
Committee comprised solely independent non-executive
directors. Details of membership to the Committee can be
found on page 137.
External audit
The Committee has satisfied itself through enquiry that the
auditor of Impala Platinum Holdings Limited is independent
as defined by the Act. The Committee, in consultation with
executive management, agreed to an audit fee for the 2010
financial year. The fee is considered appropriate for the work
that could reasonably have been foreseen at that time. Audit
fees are disclosed in note 28 to the financial statements. The
independence of the external auditor is regularly reviewed
and the approval of all non-audit related services are
governed by an appropriate approval framework.
Meetings were held with the auditor where management
was not present, and no matters of concern were raised.
The Committee has reviewed the performance of the
external auditors and nominated, for approval at
the annual general meeting PricewaterhouseCoopers Inc
as the external auditor for the 2011 financial year, with
Mr JP van Staden as the designated auditor. In terms of
the rotation requirements of the Act 2011 will be his
second year as designated auditor of the Company. The
Committee confirms that the auditor and designated
auditor are accredited by the JSE.
Financial director review
The Committee has reviewed the performance,
appropriateness and expertise of the chief financial officer,
Ms Dawn Earp, and confirms her suitability for appointment
as financial director in terms of the JSE Listings
Requirements.
Annual financial statements
The Audit and Risk Committee has evaluated the annual
report for the year ended 30 June 2010 and considers that
it complies, in all material aspects, with the requirements of
the Act and International Financial Reporting Standards.
The committee has therefore recommended the annual
financial statements as set out in the integrated annual
report for approval to the Board. The Board has
subsequently approved the financial statements which will
be open for discussion at the forthcoming annual general
meeting.
JM McMahon
Chairman of the Audit and Risk Committee
26 August 2010 |
