50 / 132
48
EC World Real Estate Investment Trust ANNUAL REPORT 2016
The Manager adopts an Enterprise Risk Management (ERM) Framework which sets out the required environmental and
organisational components for managing risk in an integrated, systematic and consistent manner. The ERM Framework
and related policies are reviewed annually.
The Manager consistently seeks to improve and strengthen its ERM Framework. As part of the ERM Framework, the
Manager, among other things, undertakes and performs a Risk and Control Self-Assessment (RCSA) process. From
the RCSA process, the Manager maintains a risk register which identifies the material risks ECW Group faces and the
corresponding internal controls it has put in place to manage or mitigate those risks. The material risks will be reviewed
annually by the ARC and the Board.
The ARC also reviews the approach of identifying and assessing risks and internal controls in the risk register. The
system of risk management and internal controls is reviewed and, where appropriate, refined regularly by Management,
the ARC and the Board. Where relevant, reference is made to the best practices and guidance in the Risk Governance
Guidance for Listed Boards issued by the Corporate Governance Council.
Management has established an approach on how risk appetite is defined, monitored and reviewed for ECW Group.
ECW Group’s RAS addresses the management of material risks faced by ECW Group. Alignment of ECW Group’s risk
profile to the RAS is achieved through various communication and monitoring mechanisms put in place across the
various functions within the Manager.
More information on the Manager’s ERM Framework can be found in the Enterprise Risk Management section on pages
57 to 59 of this Annual Report.
The internal and external auditors conduct audits that involve testing the effectiveness of the material internal controls
for ECW Group addressing financial, operational, compliance and information technology risks. This includes testing,
where practical, material internal controls in areas managed by external service providers. Any material non-compliance
or lapses in internal controls together with corrective measures recommended by the internal and external auditors
are reported to and reviewed by the ARC. The adequacy and effectiveness of the measures taken by Management in
response to the recommendations made by the internal and external auditors are also reviewed by the ARC.
The Board has received assurance from the CEO and CFO of the Manager that:
(a) the financial records of ECW Group have been properly maintained and the financial statements for FY2016 give
a true and fair view of ECW Group’s operations and finances; and
(b) the system of risk management and internal controls in place for ECW Group is adequate and effective in
addressing the material risks faced by ECW Group in its current business environment including material financial,
operational, compliance and information technology risks.
Based on the ERM Framework established and the reviews conducted by Management and both the internal and external
auditors, as well as the assurance from the CEO and CFO of the Manager, the Board concurs with the recommendation
of the ARC and is of the opinion, that the system of risk management and internal controls addressing material financial,
operational, compliance and information technology risks established by the Manager is adequate and effective to
meet the needs of ECW Group in its current business environment for FY2016.
Corporate
Governance