70
CDL
HOSPITALITY TRUSTS
For the financial year under review, the Chief Executive Officer and the Chief Financial Officer
provided assurance to the AC on the integrity of the quarterly unaudited financial statements
of the H-REIT Group, the HBT Group and the Stapled Group and the Board in turn provided a
negative assurance confirmation to the Stapled Securities Holders in respect of the unaudited
financial statements for the first, second and third quarter in accordance with the regulatory
requirements.
The Management provides monthly reports covering H-REIT Group and HBT Group’s financial
performance to all Directors, including the Chief Executive Officer.
Apart from the periodic updates provided by the Management, any member of the H-REIT
Manager Board or HBT Trustee-Manager Board may at any time seek further information from
and discuss the respective operations and performance with the Management.
Principle 11: Risk Management and Internal Controls
The H-REIT Manager Board and the HBT Trustee-Manager Board recognise that they have
overall responsibility to ensure proper financial reporting for the H-REIT Group, the HBT Group
and the Stapled Group and effectiveness of H-REIT’s and HBT’s system of internal controls,
including financial, operational, compliance and information technology controls and risk
management policies and systems.
Risk Management
The H-REIT Manager Board and HBT Trustee-Manager Board have each established a RMC
which comprises three members, the majority of whom are independent, including the chairman
of the RMC and another member who is the chairman of the AC.
The objective of the RMC is to assist the H-REIT Manager Board and HBT Trustee-Manager
Board in the discharge of their duties to maintain an effective control environment that reflects
both the established risk appetite and the business objectives.
The RMC reports to the Boards at least once a year on the nature and extent of the functions
performed by it and makes recommendations to the Boards on any matters within its scope of
duties as it may think fit. The RMC’s other duties within its written terms of reference include:
•
providing oversight of the risk management framework designed, established and
implemented by the Management for the identification, assessment, management and
monitoring of risks, and with the objective of embedding risk management into existing
management processes;
•
reviewing the overall risk appetite and tolerance as determined using the risk limits and/or
parameters established by the Management and approved by the RMC, which limits and/
or parameters are to be reviewed from time to time;
•
keeping under review the key strategic risks (and gaps) identified by the Management and
discuss with Management the risk acceptance and/or risk mitigation strategies taken in
respect of such risks;
•
reviewing H-REIT’s and HBT’s risk profile periodically and assist the Board in the review of
H-REIT’s and HBT’s risk strategy and key risk policies.
•
ensuring that Management puts in place procedures for accurate and timely monitoring
of large exposures and critical risks so that H-REIT and HBT is capable of responding to
current and prospective changes within both H-REIT’s and HBT’s business and industry
and the macroeconomic and financial environment.
Guideline 11.3(a)
In relation to the major
risks faced by the
Company, including
financial, operational,
compliance,
information technology
and sustainability,
please state the bases
for the Board’s view
on the adequacy and
effectiveness of the
Company’s internal
controls and risk
management systems.
Please refer to
paragraph under the
heading “Internal
Controls”.
CORPORATE GOVERNANCE
