45
Annual Report 2014
The ERMC has conducted four (4) meetings during the year at which discussions were held on the establishment of
new risk management policies, the existing risk management structure, the key risk exposures of the Group and the
action plans to mitigate such risks.
COSCO Shipyard Group continues to have a comprehensive strategic agreement with a leading Chinese insurance
institution to strengthen its risk management system and to enhance its operational structure. The said insurance
institution has established a team to provide the Group with different facades of insurance for domestic and
international trades; setting up a standardised claims and liabilities system; the evaluation of ship owners’ credit ratings,
the tracking of ship owners’ risk; and the evaluation of countries’ credit ratings. The Company believes all these efforts
are to help the Group to move towards the establishment of an all-encompassing risk management system.
AUDIT COMMITTEE
Principle 12
The Audit Committee (“AC”) comprises all independent directors of the Company, as follows:
Tom Yee Lat Shing (Chairman) Non-Executive Lead Independent
Wang Kai Yuen
Non-Executive Independent
Er Kwong Wah
Non-Executive Independent
Ang Swee Tian
Non-Executive Independent
The Board is satisfied with the composition of the AC and the AC members are appropriately qualified to discharge
their responsibilities. All members of the AC have recent and relevant accounting or related financial management
expertise or experience, as the Board interprets such qualification in its business judgment. By briefings given by
the External Auditors, the AC and Management are always kept abreast of changes to accounting standards and
issues which have a direct impact on financial statements. AC members will also attend trainings regarding the new
accounting standards as and when such need arises.
The AC performs the following functions:
a)
reviews with the external auditors, their audit plan, evaluation of the accounting controls, audit reports and any
matters which the external auditors wish to discuss;
b)
reviews with the internal auditors, their audit plan, the adequacy of the internal audit procedures and their
evaluation of the effectiveness of the overall internal control systems, including financial, operational, compliance
and information technology controls and risk management systems;
c)
reviews the quarterly and annual financial statements, including announcements to shareholders and the SGX-
ST prior to submission to the Board so as to ensure the integrity of the Company’s financial statements;
d)
reviews any significant findings and recommendations of the external and internal auditors and related
management response and assistance given by the management to auditors;
e)
reviews interested person transactions to ensure that internal control procedures approved by the shareholders
are adhered to;
f)
conducts annual review of the independence and objectivity of the external auditors, including the volume of
non-audit services provided by the external auditors, to satisfy itself that the nature and extent of such services
will not prejudice the independence and objectivity of the external auditors before confirming their re-nomination;
and
g)
reviews the qualifications of the candidate(s) for chief financial officer before recommending such appointment to
the Board.
Corporate Governance and Transparency
