PRINCIPLE 7: RECOGNISE AND MANAGE RISK The Board is responsible...

PRINCIPLE 7: RECOGNISE AND MANAGE RISK

The Board is responsible for satisfying itself annually, or more frequently as required, that management has developed and implemented a sound system of risk management and internal control.



7.1 Audit and Risk Committee
The Audit and Risk Committee consists of the following Non-Executive Members: Wrixon Gasteen (Chairman) Robert Hubbard Peter Moore
The Chairman of this Committee is an independent director.

7.3 No Internal Audit Function RECOMMENDATION EXPLANATION / REFERENCE
Rec 7.3 A Company should disclose if it has an internal audit function and if it does not, the process it employs for evaluating and continually approving the effectiveness of its risk management and internal control process.
The Company does not have an internal audit function, however there is a continual review process in place overseen by the Chief Financial Officer and the Audit and Risk Committee.



7.3 No Internal Audit Function
RECOMMENDATION EXPLANATION / REFERENCE Rec 7.3
A Company should disclose if it has an internal audit function and if it does not, the process it employs for evaluating and continually approving the effectiveness of its risk management and internal control process.

The Company does not have an internal audit function, however there is a continual review process in place overseen by the Chief Financial Officer and the Audit and Risk Committee.
7.4 Material Exposure The main risks which the Company is exposed to are those inherent in the industry in which it operates.
As with any oil and gas explorer and producer, the Company may be exposed to economic down turn or fluctuations in oil and gas prices, changes to government regulations or environmental operating risks.

These risks are managed through the internal control and risk management framework as set out above.

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