Oversight of the risk management system

Operational, financial reporting and regulatory compliance risks are continually assessed, monitored and managed at management level, and any specific areas of significant risk are dealt with at Board level.

Whilst the Board acknowledges that it is responsible for the overall internal control framework, it is also cognisant that no cost-effective internal control system will preclude all errors and irregularities.

To manage the Company's risk profile, the Board has established an internal control framework that can be described as follows:

• financial reporting accuracy and compliance with the financial reporting regulatory framework:
  • there is a comprehensive budgeting system with an annual budget approved by the Directors. Monthly financial results are reported against budget and revised forecasts for the remainder of the year prepared when necessary;
  • cash flow statements are also prepared on a regular basis;
  • half-yearly and annual statutory reports which are reviewed and audited respectively by the Company's external auditors and reported to the ASX;
• risk exposures relating to foreign exchange and interest rate fluctuations are managed in accordance with the Company’s Foreign Exchange and Interest Rate Risk Management Policy (Policy).  In accordance with the Policy, a Risk Management Committee has been established, comprising of Mr Charles Bass (also the Chair), the CEO and the CFO. The Risk Management Committee meet regularly to determine, with the assistance of external treasury advisers, appropriate foreign exchange and interest rate hedging strategies to manage these risks and ensure that such activities are conducted in compliance with the Company’s Policy;
• all business transactions of a material nature are properly authorised and executed; and
• the recruitment and retention of personnel with due experience, commitment and integrity.

The operational risk management procedures are reviewed on an ongoing basis to ensure they appropriately support corporate objectives.

Environmental regulation 

The Consolidated Entity is committed to ensuring that safe and sound environmental practices are carried out while undertaking exploration and mining activities and that such practices comply with the relevant statutory requirements under both Commonwealth and State legislation. The Board is not aware of any significant breaches of environmental requirements.