Experian 2014 Annual Report Download - page 25

21 Strategic report • Protecting our business
Respond to
risks
• Defined Board and Board committees’ terms of reference
• Defined global and regional authorities
• Review significant business commitments through global and regional strategic project committees
• Oversee the risk management process through global and regional risk management committees
• Report on risk to the Audit Committee and Board
Defined
governance
structure
Identify
risks
Evaluate
current
control
environment
Monitor
Communicate
Additional financial reporting internal controls
We have detailed policies and procedures to ensure the accuracy and reliability of our financial reporting and the preparation of
consolidated financial statements. This includes our comprehensive Group Accounting Manual (‘GAM’), which contains the detailed
requirements of International Financial Reporting Standards (‘IFRS’). The Group’s finance team owns the GAM and we have rolled it out
across the Group, obliging all Experian companies to follow its requirements. The GAM’s aims are to: provide guidance on accounting
issues; enable consistent and well-defined information for IFRS reporting; provide uniform quantitative and qualitative measures of
Group performance; and increase the efficiency of the Group’s reporting process.
• Assess the potential effect of each strategic, operational and financial risk on the achievement of our
business objectives
• Identify and escalate new, emerging or changing risks, significant control gaps and risk acceptance
• Consider external factors arising from the environment in which we operate and internal risks arising
from the nature of our business, its controls and processes, and our management decisions
• Evaluate compliance with policies and standards addressing risk management, compliance, accounting,
treasury management, information security, fraud and whistleblowing
• Execute formal review/approval procedures for major transactions, capital expenditure and revenue expenditure
• Monitor budgetary and performance reviews tied to KPIs and achievement of objectives
• Apply a risk scoring system, based on our assessment of the probability of a risk materialising, and the
impact and velocity if it does
• Require executive management confirmations of compliance with Experian’s system of internal control,
policies, and corporate governance and corporate responsibility processes
• Have active risk remediation strategies including internal controls, insurance and specialised
treasury instruments
• Use formal review and approval procedures for significant accepted risks
• Board- and Group-level finance reports including financial summaries, results, forecasts and revenue
trends, investor relations analysis and detailed business trading summaries
• Regional-level detailed performance reviews
• Regional and executive risk management committee and Audit Committee risk reporting on the status of
principal/emerging risks, the progress of strategic projects/acquisitions and escalation of significant
accepted risks
• Global Internal Audit reporting to the Audit Committee on assurance testing and fraud/whistleblowing
investigation results
• Management, internal audit and third parties control reviews and follow-ups
• Global Internal Audit independent assessment of the adequacy and effectiveness of the system of
internal controls
• A variety of Audit Committee risk reporting addressing material/emerging risks, material litigation,
information security and regulatory compliance
• Audit Committee annual review of the effectiveness of Experian’s systems of risk management and internal
control; receipt of an annual report on the controls over relevant risks
PRINCIPAL FEATURES OF THE RISK MANAGEMENT AND INTERNAL CONTROL FRAMEWORK