Page 30 - SABN AR 2021

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Annual Report 2021
This report is provided by the Audit and Risk Committee (ARC), in compliance with section 94 of the Companies Act. The responsibilities of the ARC are detailed in its terms of reference, which are informed by the Companies Act as well as the Code of Corporate Practices and Conduct set out in King IVTM. The terms of reference are reviewed every three years and are approved by the Board of the SABN. The ARC confirms that it carried out its functions responsibly and in compliance with its terms of reference during the period under review. The ARC met four times during the year under review.
The SABN’s management, internal and external auditors as well as other assurance providers attend the ARC meetings in an ex officio capacity. At each meeting, as appropriate, management as well as the internal and external auditors meet independently with the ARC.
Roles and responsibilities
Combined assurance
The SARB Group adopted a combined assurance approach, in line with King IVTM, to increase the effectiveness of assurance activities by the functionaries within the three lines of assurance.
The ARC considered the adopted approach to be adequate to achieve the said objective of effective assurance activities across the Company.
Financial statements
The ARC reviewed the financial statements of the SABN and the external auditor’s report thereon, and recommended the approval to the Board. The ARC is satisfied with the going-concern status of the SABN.
Finance Department
The ARC considered, and is satisfied with, the expertise and experience of the Chief Financial Officer. The ARC is also satisfied with the expertise and adequacy of the resources within the Finance Department.
External audit
The ARC is satisfied with the independence of the external auditors of the SABN. This assessment was made after considering the independence letters from the external auditors, the ongoing monitoring and approval of non-audit services, and the formal partner rotation process.
The ARC, in consultation with SABN management, reviewed the external auditor’s proposed audit scope, approach and audit fees for the year under review.
The ARC is satisfied with the formal procedures that govern the provision of non-audit services by the external auditors. These are also monitored through the reporting of such activities at each ARC meeting.
Internal audit
The ARC noted the Internal Audit Charter, which defines the purpose, authority and responsibility of the internal audit function, as approved by the shareholder’s Audit Committee. The ARC also approved the annual internal audit plan.
South African Bank Note Company (RF) Proprietary Limited
The ARC is a committee of the Board. All its members, including the Chairperson, are independent non- executive directors. Further information regarding the qualifications and company-specific experience of the committee members appears in the ‘Board of Directors’ section of this Annual Report. The ARC assists the Board in fulfilling its oversight role regarding the SABN’s financial reporting processes, system of internal financial controls, and the process for monitoring compliance with laws and regulations as they relate to financial reporting. In addition, it performs its statutory responsibility in respect of the external audit, as required by the Companies Act.
Internal control (including financial controls)
The SABN’s internal control system is designed to ensure the integrity and reliability of financial information, compliance with all applicable laws and regulations, the accomplishment of objectives, the economy and efficiency of operations, and the safeguarding of assets. The ARC is satisfied that the SABN’s system of internal financial controls is adequately designed and operates effectively to form a sound basis for the preparation of reliable financial reports. This assessment is based on reports from risk management, external audit, internal audit and management.
Audit and Risk Committee report