Lenovo 2012 Annual Report Download - page 49

2011/12 Annual Report Lenovo Group Limited 47
Additionally, the Company’s Code of Conduct
demonstrates Lenovo’s commitment to an environment of
uncompromising integrity and ethical behavior. The Code
also helps employees determine when to ask for advice,
and where to obtain it. All Lenovo employees are required
to comply with the company’s Code of Conduct, which
is available in seven languages and is accessible on the
Company’s website as well as on Lenovo’s intranet, and
to participate in regular training to reinforce the Company’s
commitment to compliance and to conducting business
with integrity. Lenovo regards any violation of the Code
as a serious matter and is committed to following up on
all reported concerns. Furthermore, in keeping with best
practices, Lenovo has developed and implemented an Anti-
Bribery and Anti-Corruption Policy which reinforces the
message in the Code of Conduct and provides additional
specific guidance regarding compliance with rules and laws
related to bribery and corruption.
The internal control system of the Company covers
every activity and transaction. Within this framework,
management performs periodic, enterprise-wide risk
assessments and continuously monitors and reports
the progress of action plans to address the key risks.
Management also tracks and reports on the implementation
of strategic initiatives, business plans, budgets and
financial results. As part of the focus on financial integrity,
all relevant senior executives regularly verify the accuracy
and completeness of the quarterly financial statements and
compliance with key internal controls.
Lenovo recognizes the importance of self testing of key
controls by management in order to ensure that the
internal controls are working as intended or that necessary
actions have been taken to address control weaknesses.
To further assist management with monitoring controls
Lenovo has established a Global Business Process &
Controls organization. As part of its mission, the Global
Business Process & Controls organization helps to clearly
communicate control requirements across all organizations
and process owners, design processes, and evaluate
the operating effectiveness and efficiency of designed
processes and controls in order to help to mitigate risk.
While management is responsible for the design,
implementation and maintenance of internal controls,
the Board and its Audit Committee oversee the actions
of management and monitor the effectiveness of the
established controls. To assist the Audit Committee in its
oversight and monitoring activities, the Company maintains
an independent, worldwide Internal Audit function which
provides objective assurance to the Audit Committee that
the system of internal controls is effective and operating
as intended. The mission of Internal Audit is to provide the
Board and Lenovo management with:
• IndependentandobjectiveassessmentofLenovo’s
system of internal controls;
• GuidanceinmanagingandcontrollingrisksforLenovo
stakeholders;
• ProactivesupporttoimproveLenovo’scontrolposture;
and
• Independentinvestigationsregardingallegationsof
fraud and violations of Lenovo’s Code of Conduct and
other company policies.
To enable it to fulfill its mission, Internal Audit has
unrestricted access to all corporate operations, records,
data files, computer programs, property, and personnel. To
preserve the independence of the Internal Audit function,
the Head of Internal Audit reports directly to the Audit
Committee on all audit matters and to the Chief Financial
Officer on administrative matters. The Head of Internal Audit
is authorized to communicate directly with the Chairman of
the Board and other Board members. To help ensure the
quality of the Internal Audit function and provide assurance
that the Internal Audit function is in conformity with the
standards of the Institute of Internal Auditors, Internal Audit
has implemented a comprehensive and continuous quality
assurance program covering all Internal Audit activities. In
addition, the Audit Committee periodically commissions
an independent, external quality assurance review of the
Internal Audit function.