Enterprise Ireland Annual Report and Accounts 2009

Statement on Internal Financial Control

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On behalf of the Board of Directors of Enterprise Ireland, I acknowledge our responsibility for the system of internal financial control in the agency and for putting in place processes and procedures for the purpose of ensuring that the system is effective.

The system can provide only reasonable and not absolute assurance that assets are safeguarded, transactions authorised and properly recorded, and that material errors or irregularities are either prevented or would be detected in a timely period.

The Board has taken steps to ensure an appropriate control environment is in place by:

  • Establishing formal procedures through various committee functions to monitor the activities and safeguard the assets of the organisation
  • Clearly defining and documenting management responsabilities and powers.
  • Developing a strong culture of accountability across all levels of the organisation

The Board has also established processes to identify and evaluate business risks. This is achieved in a number of ways including:

  • Identifying the nature, extent and financial implications of risks facing Enterprise Ireland
  • Assessing the likelihood of identified risks occurring
  • Assessing Enterprise Ireland's ability to manage and mitigate the risks that do occur
  • Working closely with Government and various agencies and institutions to ensure that there is a clear understanding of Enterprise Ireland's goals and support for the Agency's strategies to achieve those goals
  • Carrying out regular reviews of strategic plans both short and long term and evaluating the risks to bringing those plans to fruition
  • Setting annual and longer term targets for each area of our business followed by the regular reporting on the results achieved
  • Establishing and enforcing extensive standard procedures and provisions under which financial assistance may be made available to projects, including provisions requiring repayment if the project does not fulfil commitments made by the promoter
  • Establishing procedures to ensure that the schemes and programmes administered by Enterprise Ireland are in accordance with the legislation governing their operation and that appropriate risk management systems are in place

The system of internal financial control is based on a framework of regular management information, administrative procedures including segregation of duties, and a system of delegation and accountability. In particular it includes:

  • A comprehensive budgeting system with an annual budget which is reviewed and agreed by the Board of Directors
  • Regular reviews by the Board of Directors of periodic and annual financial reports which indicate financial performance against forecasts
  • Setting targets to measure financial and other performances
  • Clearly defined capital investment control guidelines
  • Formal project management disciplines

Enterprise Ireland has an internal audit department, currently staffed by a team made up of resources outsourced from a firm of accountants together with an experienced Enterprise Ireland manager. This department operates in accordance with the Internal Audit Charter approved by the Audit Committee of the Board. This committee meets on a quarterly basis to review reports prepared by Internal Audit and other departments. The Audit Committee reports regularly to the Board in relation to the matters that it has considered.

The internal audit function operates in accordance with the Framework Code of Best Practice set out in the Code of Practice on the Governance of State Bodies. A rolling three-year Internal Audit Strategic Audit Plan is approved by the Audit Committee and revised annually where required. The current work plan takes account of areas of potential risk identified in a risk assessment exercise carried out with management at the start of the current planning cycle. The Internal Auditor provides the Committee with quarterly reports on assignments carried out. These reports highlight deficiencies or weaknesses, if any, in the system of internal financial control and the recommended corrective measures to be taken where necessary. The Audit Committee receives a quarterly Management report on the status of issues raised by the Internal Audit. Internal Audit reviews this report regularly.

The Board's monitoring and review of the effectiveness of the system of internal financial control is informed by the work of the Internal Auditor, the Audit Committee which oversees the work of the Internal Auditor, the executive managers within Enterprise Ireland who have responsibility for the development and maintenance of the financial control framework and comments made by the Comptroller and Auditor General in his management letter.

I confirm that in the year to 31 December 2009, the Board conducted a review of the system of internal financial control.

On behalf of the Board of Enterprise Ireland:

Hugh Cooney Signature

Hugh Cooney,