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TEHO INTERNATIONAL INC LTD.
Annual Report 2016
REPORT
OF CORPORATE GOVERNANCE
ACCOUNTABILITYANDAUDIT
Accountability
Principle 10:
The board should present a balanced and understandable assessment of the
company’s performance, position and prospects.
For the financial performance reporting via the SGXNET to SGX-ST, and the annual report to
the shareholders, the Board has a responsibility to present a balanced and understandable
assessment of the Group’s performance, financial position and prospects to the public,
including interim and other price sensitive public reports and reports to regulators
(if required).
The Board ensures that the management maintains a sound system of internal controls to
safeguard the shareholders’ investments and the Group’s assets.
The management will provide all members of the Board with management accounts of the
Group’s performance, with explanatory details on its operations. Board papers are given
prior to any Board meeting to facilitate effective discussion and decision-making.
The Board also announces the Group’s half-year and full year results and performance
review via the SGXNET for the benefit of its shareholders.
Risk Management and Internal Controls
Principle 11:
The board is responsible for the governance of risk. The board should ensure
that management maintains a sound system of risk management and
internal controls to safeguard shareholders’ interests and the company’s
assets, and should determine the nature and extent of the significant risks
which the board is willing to take in achieving its strategic objectives.
The Company does not have a Risk Management Committee. However, the executive
directors and management regularly review the Group’s business and operational activities
to identify areas of significant business risks as well as appropriate measures to control
and mitigate these risks. Management reviews significant control policies and procedures
and highlights the significant matters to the Board and the AC. Furthermore, on AC’s
recommendation, the Board had appointed Ernst & Young Advisory Pte. Ltd. (the “Internal
Auditors”) to conduct a Risk Management Assessment of the Group.
The Board is responsible for the overall internal control framework and is fully aware of the
need to put in place a systemof internal controlswithin the Group to safeguard shareholders’
interests and the Group’s assets, and to manage risks.
On the recommendation of the AC, the Chief Financial Officer takes on the additional
duties of a compliance officer and to co-ordinate and oversee the works of the Company’s
professional service providers.
Enterprise Risk Management
The AC had engaged the Internal Auditors to undertake an initial Enterprise Risk
Management Review of the Group, which commenced in October 2013, to enable the Board
and management to understand the inherent industry, financial, operational, compliance and
information technology risks of the Group. Following the Group’s diversification into the real
estate business in the second half of FY2014, the scope of the Enterprise Risk Management
Review was expanded to cover the newly acquired companies in the Property Development
segment, namely TIEC Holdings Pte. Ltd. (acquisition completed in May 2014), and ECG
Property Services Pte. Ltd. and its subsidiaries (acquisition completed in November 2014).
As part of the Enterprise Risk Management Review, the Internal Auditors engaged key
members of management including the AC members and the CEO to carry out the following:
(a) Evaluate the current internal and external operating environment of the various
business units of the Group;
(b) Identify possible risks, potential contributing factors and consequences arising from
the crystalisation of those risks;
(c)
Determine the impact and likelihood of the identified risks;
(d) Identify improvement opportunities for control gaps; and
(e) Prioritise and rank the identified risks.
