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## CORPORATE GOVERNANCE CONTINUED 

## Financial Reporting 

The Board is provided with monthly reports from management on the financial performance of the Company. The monthly reports include details of all key financial measures reported against budgets approved by the Board. The Company’s financial report preparation and approval process for the 2004 financial year involved both the Managing Director and the Chief Financial Officer making the following certifications to the Board that: 

• the Company’s financial reports and accompanying notes represent a true and fair view in all material respects of the Company’s financial condition and operational results and are in accordance with relevant accounting standards; 

• the above statement is founded on a sound system of risk management and internal compliance and control which implements the policies adopted by the Board; and 

• the Company’s risk management and internal compliance and control system is operating efficiently and effectively in all material respects. 

## Board Committees 

The Board has established two Committees to assist it in carrying out its responsibilities, the Board Nomination and Remuneration Committee and the Audit and Risk Committee. 

Each Committee has its own written charter setting out its role and responsibilities, composition, structure, membership requirements and the manner in which the Committee is to operate. All matters determined by Committees are submitted to the full Board as recommendations for Board decision. 

## Board Nomination and Remuneration Committee 

The current composition of the Board Nomination and Remuneration Committee is the full Board. The Chairman is the Chairman of the Board. The Managing Director does not have voting rights. 

The Committee operates in accordance with its charter which is available on the company’s website. 

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The Board has charged the Board Nomination and Remuneration Committee with responsibility to: 

• assist the Board in ensuring that it is comprised of Directors with the appropriate mix of skills, experiences and competencies to discharge its mandate effectively; 

• establish procedures for the selection and recommendation of candidates suitable for appointment to the Board; 

• ensure that the Company has in place appropriate remuneration policies designed to meet the needs of the Company and to enhance corporate and individual performance; 

• reviews the succession planning for the Board and senior management and reports to the Board on such issues. 

## Audit and Risk Committee 

The existence of the Audit and Risk Committee is considered by the Company to be a key element of its corporate governance program and part of the Company’s commitment to best practice in the area of corporate governance. 

The Audit and Risk Committee consists of the following Non-Executive Independent Directors: 

R J Wright (Chairman) 

R D McIlwain 

D D McDonough 

All members of the Audit and Risk Committee are financially literate and have the requisite financial expertise. Some members have an understanding of the industry in which the Company operates. 

The Audit and Risk Committee operates in accordance with a charter which is available on the Company’s website. The Audit and Risk Committee supports the full Board and essentially acts in a review and advisory capacity. The Committee is considered to be a more efficient forum than the full Board for focusing on particular issues relevant to: 

• verifying and safeguarding the integrity of the Company’s financial reporting including the review, assessment and approval of the half-year financial report, the annual report and all other financial information published by the Company or released to the market; 

• establishing a sound system of risk oversight and management, and, internal control; 

• establishing a sound system of compliance with laws and regulations, internal compliance guidelines, policies, procedures and control systems and prescribed internal standards of behaviour. 

