Internal Control and Risk Management System > Internal Control and Risk Management System Model

The internal control and risk management system (hereinafter the "ICRMS") of JSC IDGC of the North-West is an element of the Company's corporate governance system which includes the whole range of control procedures, methods and mechanisms created by the Company's Board of Directors and executive bodies in order to ensure the effectiveness of internal control over financial and business activities of the Company.

In order to develop ICRMS in the Company the Board of Directors approved the following regulations:

  • Internal Control Policy;
  • Risk Management Policy;
  • Regulation of the Committee for Audit of the Board of Directors;
  • Corporate Code of Conduct.

The key objectives of ICRMS are:

  • effective achievement of the Company's strategic and shareholders' goals;
  • increase of the quality of the Company's corporate governance system;
  • increase of operational and investment activities of the Company.

The ICRMS improvement is carried out at all levels of the Company's management in the following control areas:

  • preliminary control (risk management system) includes identification, assessment and management of risks (threats and opportunities) for the purpose of effective achievement of shareholders' and strategic goals and identification and management of risks relating to economic and energy safety;
  • routine control includes regulation and standardization of business processes with determination of control procedures and responsibility of participants of business processes at various management levels;
  • follow-up control includes revision of accuracy of reports and statements, safety of assets, compliance of financial and business operations with the laws, Articles of Association, local regulations, internal audit of organization of business processes and ICRMS, control of compliance with the Corporate Code of Conduct, anti-corruption control.

The Company's regulations establish an «allocated» ICRMS model which allocates the responsibility as follows:

  • the Company's Board of Directors sets ICRMS development areas;
  • the Committee for Audit of the Board of Directors monitors the efficiency of ICRMS;
  • internal audit and risk management subdivision performs audit and direct assessment of the ICRMS efficiency, corporate governance system and follow-up control procedures. In addition, it carries out organization and coordination of preparation of reports on risks, ensures the provision of information on risks and internal control procedures in the Company to relevant stakeholders;
  • the Company's executive bodies are responsible for organization of effective procedures of routine and preventive control and enforcement of local regulations on ICRMS
  • officers (owners of business processes) are responsible for establishment and implementation of control procedures and risk management activities and timely identification and assessment of risks.

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