Page 48 - SAR141018_Forterra AR 2013

FORTERRA
ANNUAL REPORT 2013
CORPORATE GOVERNANCE
REPORT
46
ACCOUNTABILITY AND AUDIT
Principle 10: Accountability
The Board of the Trustee-Manager is responsible for providing a balanced and understandable
assessment of Forterra’s performance, position and prospects, through various public reports and
reports to regulators (where required), including its quarterly financial statements, annual report, as
well as announcements via SGXNet, press releases and corporate website. In turn, Management provides
the Board with reports encompassing financial results, market and operational information, which
present a balanced and understandable assessment of Forterra’s performance, position and prospects,
on a periodic basis. These reports, consist of detailed management accounts, budgets versus actual
accounts, cashflow reports, portfolio performance information and economic information relating to
the Chinese economy. In addition to this, ad-hoc reports are provided to the Board by Management
from time to time on matters considered to be of importance.
Principle 11: Risk Management and Internal Controls
The Board of the Trustee-Manager is responsible for the governance of risk and for setting the risk
tolerance levels of the Board. To ensure that a sound system of risk management and internal controls
are in place to safeguard the interests of Forterra and the Unitholders, as well as determining the nature
and extent of the significant risks which the Board is willing to take in achieving the strategic objectives
of Forterra; the Board, with the assistance of a third party engaged to review the internal control
system, has developed a Risk Governance and Internal Control Framework Manual (“Framework”)
covering financial, operational, compliance and IT controls. Management provides periodic update to
the Board according to the Framework on a quarterly basis. The Framework will be reviewed annually
by the Board as part of their assessment of the adequacy and effectiveness of the risk management
and internal control systems.
As part of the approval process of the 2013 Annual Report, the Board has received assurance from
the CEO and CFO:
(a) that the financial records have been properly maintained and the financial statements give a true
and fair view of Forterra’s operations and finances; and
(b) regarding the effectiveness of Forterra’s risk management and internal control systems.
The Board is assisted in assessing the internal controls by the Audit Committee whose responsibility,
inter alia, is to monitor and evaluate the compliance of principal internal control systems and procedures
and risk management systems established by Management of the Trustee-Manager and the Property
Manager and the effectiveness of these internal controls and risk management system. During the year
under review, the internal auditors reviewed the control activities relating to a key development site.
The external auditors reviewed and made reference to the findings by the internal auditors on their
external audit work.