The Board acknowledges its responsibility for maintaining and reviewing the effectiveness of the Group’s internal control system. Such system is implemented to minimize the risks to which the Group is exposed and used as a management tool for the day-to-day operation of business. The system can provide reasonable but not absolute assurance against misstatements or losses. The management is primarily responsible for the design, implementation, and maintenance of the internal control system to safeguard the Shareholders’ investment and assets of the Group. Budgets and forecasts on all capital and revenue items are prepared and reviewed by senior management. The management monitors the business activities closely and reviews monthly financial results of operations against budgets/forecast.
The Internal Audit Department is assigned with the tasks to carry out the analysis and independent appraisal of adequacy and effectiveness of the internal control system in respect of all material controls, including financial, operational and compliance aspects; alert the management on the audit review findings or irregularities and advise them on the implementation of necessary steps and actions to enhance the internal controls of the Group; and report results of internal audit reviews and agreed action plans to the Audit Committee and the Board on regular basis.
During the Year, the management had analyzed control environment, identified risks pertaining thereto, and implemented various controls therein. The approach of the review includes conducting interviews with relevant staff members, reviewing relevant documentation of the internal control system and evaluating findings on any deficiencies in the design of the internal control system, developing recommendations for improvement and assessing the effectiveness of implementation of such recommendations, where appropriate. The scope and findings of the review had been reported to and reviewed by the Audit Committee.
The following policies and procedures are also in place to enhance the internal control system:
i. Policies and checklists on control of rental revenue, lease terms and conditions, appointment of agency, asset security and performance review for leasing of Group’s premises;
ii. Internal procedures on the acquisition of properties;
iii. Regular reports on revenue, marker receivables’ ageing and debtors’ ageing and internal financial reports are prepared to the management which give a balanced and understandable assessment of the Group’s financial performance;
iv. Surprise physical count of cash, chips and client deposits held in casino and coupons for casino are performed by Internal Audit Department to safeguard the assets;
v. Regular review on operational systems of hotel and gaming business segments to ensure the service quality; and questionnaires are provided in different outlets to welcome customers’ feedbacks for our service improvement;
vi. Monthly updates on internal financial information are provided to director and senior management which give a balanced and understandable assessment of the Group’s performance, financial position and prospects in sufficient details;
vii. the Systems and Procedures on Disclosure of Inside Information to ensure, with the assistance of an internal work team (if required), that any material information which comes to the knowledge of any one or more officers should be promptly identified, assessed and escalated, where appropriate, for the attention of the Board. The Board shall make timely decisions on disclosure, if necessary and take appropriate measures to preserve confidentiality of inside information until proper dissemination of inside information;
viii. the policies and practices on compliance with legal and regulatory requirements which shall be reviewed and monitored regularly by the Corporate Governance Committee as delegated by the Board;
ix. the establishment of a CCT Compliance Committee to monitor, control and regularly review connected transactions and continuing connected transactions of the Company and ensure proper compliance with all relevant laws and regulations and the Listing Rules and disclosure requirements;
x. a whistle-blowing policy for employees of the Group to raise concerns, in confidence, about possible improprieties in financial reporting, internal control or other matters. Such arrangement will be reviewed by the Audit Committee which ensures that proper arrangement is in place for fair and independent investigation of the matters; and
xi. the Anti-money Laundering and Counter-terrorist Financing Policy and Procedure establishes the general framework for combating crime against money laundering and financing of terrorism. It provides guideline to prevent the Group’s employees and clients/customers/suppliers/vendors/contractors from being misused for money laundering, terrorist financing or other financial crime and has set out some indications of potentially suspicious transactions/activities for employees’ reference. The application and effectiveness of this policy and procedure will be monitored and reviewed regularly by Legal and Secretarial Department, Internal Audit Department and Human Resources Department.
The Board and the Audit Committee had conducted a review on the effectiveness of internal control system (including financial, operational, compliance controls, risk management functions) and the adequacy of resources, staff qualifications and experience, training programmes and budget of the Company’s accounting and financial reporting function. The Board considered that the Company has been maintaining a sound and effective internal controls to safeguard Shareholders’ investment and the Group’s assets.