Lenovo 2015 Annual Report Download - page 74

72 Lenovo Group Limited 2014/15 Annual Report
CORPORATE GOVERNANCE REPORT
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, the Audit Committee Chair and other Board members as deemed necessary. 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.
In selecting the audits to perform each year, Internal Audit performs a risk assessment using information collected
from process owners, the enterprise risk management team, senior executives, the external auditor and the Board
along with an analysis of prior audit issues and other data. Internal Audit develops an audit plan that prioritizes areas
with significant risks or deemed to be strategic in nature to the business. The audit plan is reviewed by the Audit
Committee, which is also given quarterly updates on the performance of the plan and key findings. As necessary
throughout the year, the audit plan will be modified to reflect emerging risks or changes to business plans. Ad hoc
reviews of areas of concern identified by management or the Audit Committee may also be performed. During the
last year, Internal Audit issued multiple reports covering all significant operational and financial units worldwide. In
keeping with best practices, Internal Audit regularly monitors the status of management action plans resulting from
audit findings to ensure completion and reports progress each quarter to the Audit Committee. Audit Committee
reporting also includes identified key control issues to provide the Audit Committee full visibility to the status of
Lenovo’s control environment.
Furthermore, Internal Audit is responsible for investigating certain allegations of potential violations of the Code,
or any other company policies as appropriate. Internal Audit partners with Legal, Ethics and Compliance, Human
Resources, and other subject matter experts where necessary to ensure the appropriate expertise when performing
these investigations. Management and the Audit Committee are informed of the results of these investigations, any
resulting required actions, and status updates on actions.
Inside information
Regarding procedures and internal controls for the handling and dissemination of inside information, the Company:
(i) is aware of its obligations under the SFO and the Listing Rules and the overriding principle that inside
information should be announced immediately if it is the subject of a decision;
(ii) conducts its affairs with close regard to the applicable laws and regulations prevailing in Hong Kong;
(iii) has included in the Code a strict prohibition on the unauthorized use of non-public or inside information;
(iv) has established a Continuous Disclosures Policy and implemented guidelines for monitoring, reporting and
disseminating inside information to our shareholders, investors, analysts and media. These policies and
guidelines also identify who are the Company’s authorized spokespersons and their responsibilities for
communications with stakeholders; and
(v) has communicated to all relevant staff regarding the implementation of the Continuous Disclosures Policy and
the relevant trainings are also provided.