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AFRICAN DAWN ANNUAL REPORT 2020

Corporate Governance continued

• Recommend the annual report to the Board for approval; and
• Determine the levels of assurance required on integrated and financial reporting. It should be noted that Afdawn’s focus again for the
year was on continually improving the annual financial statements. The integrated report will be a journey that the group will embark on
over the next few years.
• Finance function
• Consider the expertise and experience of the financial director;
• Consider the expertise, experience and resources of the Group’s finance function; and
• Consider the effectiveness of internal control over finance. External expertise was brought in to ensure that the skills were appropriate.

• Internal audit
Due to capital and resource constraints, the Group does not have a separate internal audit function. The oversight of internal controls remained
with the Audit and Risk Committee and the required testing and investigation was performed in-house by competent financial staff. A separate
internal audit division with qualified internal auditor will be formalised and implemented when the Group has the necessary capital and resources.
The internal audit tasks remain with the Audit and Risk Committee for the time being until the internal audit department will take responsibility
for all internal audit matters.

• External audit
• Act as a liaison between the external auditor and the Board;
• Obtain information in order to satisfy itself as to the competency of the external auditor and then nominate for appointment by
shareholders;
• Consider the scope of audit and non-audit services which the external auditor may provide to the Group;

• Review letters from auditor stating points of improvement or control deficiencies;
• Approve the fees of the external auditor and assess their performance; and
• Annually assess the independence of the external auditors.
• Risk management
There was no separate risk committee and the Audit and Risk Committee assumed the responsibility and tasks. The responsibilities include,
ensuring that management’s processes and procedures are adequate to identify, assess, manage and monitor, Company specific and Group risks.
The key focus areas are included in the Audit and Risk Committee reports;
• Financial / liquidity risks
• Information technology risk
• Human resources risk
• Operational risk
• Legal/compliance risk
• Strategic risk
• JSE Pro-active monitoring letters.

Managers are urged to identify, report and assist with mitigating controls and procedures to lower the risk to acceptable levels.
The Audit and Risk Committee is satisfied that they have fulfilled their responsibilities.

6. Risk Management
The Board is ultimately responsible for the management of risk. Due to the importance and need for good governance it is assisted by the Audit
and Risk Committee. The management of risk has included a pro-active approach through an implemented system of effective internal controls
maintained and constantly improved by competent ethical managers. The management of risk relies on well-established governance processes
and relies on both individual responsibility and collective oversight, supported by comprehensive reporting. The risk approach is one of strong
corporate oversight, with the executives having pro-active participation in managing the risks and are responsible for identifying and contributing
to mitigating strategies to manage risk to an acceptable level. Risk management is seen as the responsibility of each and every employee.

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