Qantas 2011 Annual Report Download - page 27

25 ANNUAL REPORT 2011
for the year ended 30 June 2011
Corporate Governance Statement continued
b. Any non-audit services provided during the / nancial
year by KPMG as the external auditor did not compromise the
independence requirements of the Corporations Act  for
the following reasons:
– KPMG services have not involved partners or staff acting in a
managerial or decision-making capacity within the Qantas Group
or being involved in the processing or originating of transactions
– KPMG non-audit services have only been provided where
Qantas is satised that the related function or process will
not have a material bearing on the audit procedures
– KPMG partners and staff involved in the provision of non-audit
services have not participated in associated approval or
authorisation processes
– A description of all non-audit services undertaken by KPMG
and the related fees have been reported to the Board to ensure
complete transparency in relation to the services provided
– The declaration required by section C of the Corporations Act
 conrming independence has been received from KPMG.”
Qantas rotates the lead audit partner every ve years and imposes
restrictions on the employment of ex-employees of the external auditor.
Policies are in place to restrict the type of non-audit services which
can be provided by the external auditor and there is a detailed
quarterly review of non-audit fees paid to the external auditor.
At each meeting, the Audit Committee meets privately with Executive
Management without the external auditor, and with the internal and
external auditors without Executive Management.
THE BOARD MAKES TIMELY AND BALANCED DISCLOSURE
Qantas has an established process to ensure that it is in compliance
with its ASX Listing Rule disclosure requirements. This includes a
quarterly conrmation by all Executive Management that their areas
have complied with the Continuous Disclosure Policy, together with
an ongoing obligation to advise the Company Secretary of any
material non-public information arising in between conrmations.
The Continuous Disclosure Policy is summarised in the Qantas Group
Business Practices Document which is available in the Corporate
Governance section on the Qantas website.
THE BOARD RESPECTS THE RIGHTS OF SHAREHOLDERS
Qantas has a Shareholder Communications Policy which promotes
effective communication with shareholders and encourages
participation at general meetings. The Qantas Shareholder
Communications Policy is summarised in the Qantas Group
Business Practices Document which is available in the Corporate
Governance section on the Qantas website.
Qantas makes all ASX announcements available on its website.
In addition, shareholders who are registered receive email
notication of announcements.
The  Notice of Annual General Meeting will be provided
to all shareholders and posted on the Qantas website, and the
 AGM proceedings will be available for viewing by live and
archived webcast. For shareholders unable to attend, an AGM
Question Form will accompany the Notice of Meeting, giving
shareholders the opportunity to forward questions and comments
to Qantas or the external auditor prior to the AGM.
Auditor at AGM
The external auditor attends the AGM and is available to answer
shareholder questions on:
— The conduct of the audit
— The preparation and content of the Auditor’s Report
— The accounting policies adopted by Qantas in relation
to the preparation of the Financial Report
— The independence of the auditor in relation to the conduct
of the audit
THE BOARD RECOGNISES AND MANAGES RISK
Qantas is committed to embedding risk management practices to
support the achievement of business objectives and full corporate
governance obligations. The Board is responsible for reviewing
and overseeing the risk management strategy for the Group and
for ensuring the Group has an appropriate corporate governance
structure. Within that overall strategy, Management has designed
and implemented a risk management and internal control system
to manage Qantas’ material business risks.
Qantas is a complex business and faces a range of strategic,
nancial and operational risks inherent in operating in the aviation
industry. To manage these and other risks, the Board is responsible
for reviewing and approving the Qantas Group Risk Management
Framework (Framework). The Framework is underpinned by three
interrelated elements: governance, risk management and assurance.
The Board also reviews and approves the Qantas Group Risk
Management Policy (Policy), which sets out the minimum requirements
and roles and responsibilities for managing risk across the Qantas
Group. All employees have a responsibility to identify, report and/or
manage risk as it arises within the work environment. Summaries
of the Policy and other signicant risk policies are included in the
Qantas Group Business Practices Document available in the
Corporate Governance section on the Qantas website.
The Qantas risk management and internal control system aligns
to the principles included in the Australian/New Zealand Standard
on Risk Management (AS/NZS ISO :) and the Committee
of Sponsoring Organisations of the Treadway Commission (COSO)
framework for evaluating internal controls.
The Qantas Management System (QMS), which has been
implemented across the Group, provides a common standard for
identifying, assessing and managing material business risks across
the Group. QMS provides guidance for business units to adopt
regarding leadership, commitment and planning, process
management, risk management, assurance
and training and promotion.
Material risks and the effectiveness of risk management plans are
escalated to Executive Management, relevant Board Committees
and/or the Board as appropriate and are reported on as part of
the quarterly risk reporting process. During the quarterly risk reporting
process, each Qantas Group business unit prepares and submits
a detailed risk register outlining the key risks to achieving their
objectives and mitigating actions. Beyond reporting, the identication,
assessment and management of risks is also integrated into key
business decision-making and activities, such as strategy
development, projects and change initiatives.