The Board acknowledges that it is responsible for the overall internal control framework, but recognises that no cost effective internal control system will preclude all errors and irregularities. To assist in discharging this responsibility, the Board has instigated an internal control framework that can be described under the following headings:
There is a comprehensive budgeting system with a budget approved by the directors. The Audit Committee reviews all final year-end draft financial reports with the CEO, the chief financial officer and auditors and recommendations on their adequacy to the Board prior to their release to members and other public forums. There is regular communication between management and external auditors. Pursuant to the TSX.V's corporate governance recommendations, the CEO and chief financial officer are required to state in writing that the Company's and consolidated entity's financial reports present a true and fair view, in all material aspects, of the Company's and consolidated entity's financial condition and that operational results are in accordance with relevant accounting standards.
All shareholders and investors have equal access to the Company's information that is public. All material and price sensitive information is disclosed to the TSX.V in accordance with the continuous disclosure requirements of applicable law and TSX.V Listing Rules. All material announcements provided to the TSX.V are posted to the Company's web site and SEDAR.
The Company Secretary has responsibility for overseeing the continuous disclosure practices of the Company and its controlled entities. His responsibilities include:
- Ensuring compliance with continuous disclosure requirements;
- Overseeing and coordinating the disclosure of information to the TSX.V, analysts, brokers, shareholders, the media and public; and
- Educating directors and staff of the Company's and consolidated entity's disclosure policies and procedures and raising awareness of the principles of the underlying continuous disclosure.
Company's and its controlled entities adopted policies on continuous disclosure include the following:
- The Company should keep to a minimum the number of directors and staff authorised to speak on the Company's behalf;
- The officer responsible for disclosure should be made aware of information to be disclosed in advance, including information to be presented at private briefings;
- Price sensitive information should be publicly released through the stock exchange before disclosing it to analysts or other outside the Company;
- Announcements should be posted on the Company's website following their announcement to the TSX.V;
- Only information that has been (or is based on information that has been) publicly released through the TSX.V should be disclosed to analysts, shareholders or others outside the Company;
- If price sensitive information is leaked or inadvertently disclosed, an announcement should be made to the TSX.V and posted on the Company's website; and
- If the Company becomes aware of a significantly widespread rumour which could be expected to have a material effect on the price or value of the Company's securities, an announcement should be made to the TSX.V which addresses the rumour (where commercially feasible).
Trading in Company securities by directors, officers and employees
The Company has established rules for the trading in Company securities by directors officers and employees to ensure compliance with TSX.V guidelines.
The CEO has been appointed to ensure that the following rules for the trading in Company securities are strictly adhered to by all directors, officers and employees:
- Trading in Company securities is only permitted following the notification of the intention to trade with the CEO;
- Trading in Company securities is prohibited at any time when in possession of unpublished information, which if generally available, might materially affect the price or value of those securities, or for a period of 2 business days following the making of a public announcement in relation to that inside information ("the due notice period");
- Active trading in Company securities, which involves frequent and regular trading in those securities with a view to derive profit related income from that activity, is prohibited; and
- Only in exceptional circumstances, can approval be obtained in advance from the CEO, to trade outside the due notice period.
Business risk management
The Board examines and considers areas of significant business risk and implements policy to minimise exposure to these risks. Areas of risk which are considered at Board meetings include:
- Asset protection/development;
- Performance of activities;
- Organisational behaviour;
- Human resources;
- Workplace safety;
- The environment; and
- Continuous disclosure obligations.
- Comprehensive practices are established such that:
- Capital expenditure above a certain size require Board approval;
- Financial exposures are controlled;
- Occupational health and safety standards and management systems are monitored and reviewed to achieve high standards of performance and compliance with regulations; and
- Business transactions are properly authorised and executed.