In accordance with the FRC ‘Guidance on Risk Management, Internal Control and Related Financial Business Reporting’ the Board recognises that it is responsible for the Group’s risk management and internal control systems. These systems have been designed to manage rather than eliminate the risk of failure to achieve business objectives and can only provide reasonable and not absolute assurance against material misstatement or loss. The Audit Committee assists the Board in the effective discharge of its responsibilities for financial reporting, risk management and internal control, with the Audit Committee well-placed to challenge the performance of the Group‘s financial reporting, risk management and internal control systems to safeguard the interests of shareholders.
The Board has embedded a continuous process for identifying, evaluating and managing the Group’s significant risks, including risks arising out of Bodycote’s corporate and social engagement. The Board’s monitoring covers all significant strategic, financial, operational and compliance risks. It is based principally on reviewing reports from management and from Internal Audit (IA) to consider whether any significant failings or weaknesses are promptly remedied or indicate a need for more extensive monitoring. The Audit Committee assists the Board in discharging these responsibilities.
The emerging risk review, based around horizon scanning, has explored what the future might look like and seeks to identify early warning signals. Emerging risks are characterised by their high level of uncertainty both in terms of likelihood and potential impact and are therefore more difficult to manage or mitigate. The emerging risks that have been considered by the Board include geopolitical risk, more specifically, the unpredictable geopolitical landscape and uncertainty over future global events. More information on emerging risk reviews can be found on page 28 of the annual report.
The Board is satisfied that the Group maintains an effective system of internal controls and that there were no significant failings or weaknesses in the system. The system was in operation throughout 2023 and continues to operate up to the date of the approval of this report. The key elements of the Group’s system of internal control that is monitored by the Board include:
Bodycote has engaged BDO to monitor and assist in improving the Group’s internal control system. IA reviews are conducted on the basis of a risk-based plan approved annually by the Audit Committee.
During 2023, in compliance with Provision 29 of the Code, the Executive Committee performed an assessment of its risk management processes by holding risk reviews which were conducted via an internally facilitated risk workshop and an externally facilitated workshop with BDO. Management’s assessment, which has been reviewed by the Board, included a review of the Group’s key strategic, operational and emerging risks. As a result of the risk reviews, it was concluded that there would be no changes to the principal risks as at December 2023. Refer to pages 28 to 32 of the annual report for further information on principal risks and uncertainties affecting the Group.
In accordance with the FRC ‘Guidance on Risk Management, Internal Control and Related Financial Business Reporting’ the Board recognises that it is responsible for the Group’s risk management and internal control systems. These systems have been designed to manage rather than eliminate the risk of failure to achieve business objectives and can only provide reasonable and not absolute assurance against material misstatement or loss. The Audit Committee assists the Board in the effective discharge of its responsibilities for financial reporting, risk management and internal control, with the Audit Committee well-placed to challenge the performance of the Group‘s financial reporting, risk management and internal control systems to safeguard the interests of shareholders.
The Board has embedded a continuous process for identifying, evaluating and managing the Group’s significant risks, including risks arising out of Bodycote’s corporate and social engagement. The Board’s monitoring covers all significant strategic, financial, operational and compliance risks. It is based principally on reviewing reports from management and from Internal Audit (IA) to consider whether any significant failings or weaknesses are promptly remedied or indicate a need for more extensive monitoring. The Audit Committee assists the Board in discharging these responsibilities.
The emerging risk review, based around horizon scanning, has explored what the future might look like and seeks to identify early warning signals. Emerging risks are characterised by their high level of uncertainty both in terms of likelihood and potential impact and are therefore more difficult to manage or mitigate. The emerging risks that have been considered by the Board include geopolitical risk, more specifically, the unpredictable geopolitical landscape and uncertainty over future global events. More information on emerging risk reviews can be found on page 28 of the annual report.
The Board is satisfied that the Group maintains an effective system of internal controls and that there were no significant failings or weaknesses in the system. The system was in operation throughout 2023 and continues to operate up to the date of the approval of this report. The key elements of the Group’s system of internal control that is monitored by the Board include:
Bodycote has engaged BDO to monitor and assist in improving the Group’s internal control system. IA reviews are conducted on the basis of a risk-based plan approved annually by the Audit Committee.
During 2023, in compliance with Provision 29 of the Code, the Executive Committee performed an assessment of its risk management processes by holding risk reviews which were conducted via an internally facilitated risk workshop and an externally facilitated workshop with BDO. Management’s assessment, which has been reviewed by the Board, included a review of the Group’s key strategic, operational and emerging risks. As a result of the risk reviews, it was concluded that there would be no changes to the principal risks as at December 2023. Refer to pages 28 to 32 of the annual report for further information on principal risks and uncertainties affecting the Group.
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