Audit and Risk Committee report

For the year ended 30 June 2011

Introduction

The Audit and Risk Committee presents its report for the financial year ended 30 June 2011. The Audit and Risk Committee is an independent statutory committee, whose duties are delegated to it by the Board. The Committee has conducted its affairs in compliance with a Board approved terms of reference, and has discharged its responsibilities contained therein.

Objectives and scope

The overall objectives of the Committee are:
  • To assist the Board in discharging its duties relating to the safeguarding of assets and the operation of adequate systems and control processes
  • To control reporting processes and the preparation of financial statements in compliance with the applicable legal and regulatory requirements and accounting standards
  • To provide a forum for the governance of risk, including control issues and developing recommendations for consideration by the Board
  • To oversee the internal and external audit appointments and functions
  • To perform duties that are attributed to it by the Act, the JSE and King IIl.
Committee performance:
  • 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 audit findings and their concerns arising out of their audits and requested appropriate responses from Management
  • Made recommendations to the Board of directors regarding the corrective actions to be taken as a consequence of audit findings
  • Considered the independence and objectivity of the external auditors and ensured that the scope of their additional services provided did not impair their independence
  • Received and dealt with concerns and complaints through “whistle-blowing” mechanisms that were reported to the Committee by the Group Internal Audit function
  • Reviewed a documented assessment, including key assumptions, prepared by management on the going concern status of the Company, and accordingly made recommendations to the Board
  • Reviewed and recommended for adoption by the Board the financial information that is publicly disclosed, which included:
    The Integrated Annual Report for the year ended 30 June 2011
    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
  • Reviewed the performance and expertise of the Chief Financial Officer and confirmed her suitability for the position
  • Satisfied itself that the internal audit function is efficient and effective and carried out its duties in an independent manner in accordance with a Board approved internal audit charter.

The Committee is satisfied that it has fulfilled its obligations in respect of its scope of responsibilities.

Membership

The membership of the Committee comprised solely of independent non-executive directors. In addition, the Chief Executive Officer, the Chief Financial Officer, Head of Group Internal Audit, the Risk Executive and the external auditors are also permanent invitees to the meeting. Details of membership of the Committee can be found here and the attendance record of the members is available here. The effectiveness of the Committee is assessed every two years. As required by the Act, the Committee is to be elected by shareholders at the forthcoming Annual General Meeting.

External audit

The Committee has satisfied itself through enquiry that the auditor of Impala Platinum Holdings Limited is independent as defined by the Act. Meetings were held with the auditor where Management was not present.

No material non-audit services were provided by the external auditors during the year under review.

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 2012 financial year. Mr Jean-Pierre van Staden is the designated auditor and, in terms of the rotation requirements of the Act, 2012 will be his third year as designated auditor of the Company. The Committee confirms that the auditor and designated auditor are accredited by the JSE.

Integrated Annual Report

The Audit and Risk Committee has evaluated the Integrated Annual Report, incorporating the annual financial statements, for the year ended 30 June 2011. The Audit and Risk Committee has also considered the sustainability information as disclosed in the Integrated Annual Report and has assessed its consistency with operational and other information known to audit committee members. The Committee has also considered the external assurance providers report and is satisfied that the information is reliable and consistent with the financial results. The annual financial statements have been prepared using appropriate accounting policies, which conform to International Financial Reporting Standards. The Committee has therefore recommended the Integrated Annual Report for approval to the Board. The Board has subsequently approved the report and the annual financial statements, which will be open for discussion at the Annual General Meeting.

Based on the results of the formal documented review of the Company's system of internal financial controls which was performed by the internal audit function and external auditors, nothing had come to the attention of the Audit and Risk Committee to indicate that the internal financial controls were not operating effectively.

JM McMahon
Chairman of the Audit and Risk Committee

25 August 2011