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Internal audit

The Metalloinvest Board of Directors regards internal control and audit functions as essential to the Company’s sustainable development.

The internal audit system covers management at all levels and comprises:т:

  • the Board of Directors Audit Committee;
  • the Internal Audit Directorate and its regional branches (located in the Company’s business units).

In the interests of independence and neutrality, an independent director is elected to head the Board of Directors Audit Committee. The director of internal audit is functionally subordinate to the Board of Directors Audit Committee and administratively subordinate to the CEO, which also accords with the principle of independence and neutrality.

The mission of internal audit is to maintain and increase the value of the Company by carrying out objective internal audits based on a risk-based approach, making recommendations and exchanging knowledge.

Internal audit is therefore the business of providing independent and objective guarantees and advice for the purpose of improving the work of the Company.

Internal audit assists the Company in achieving its objectives by using a systematic and consistent approach to assessing and improving risk management, control and corporate governance processes.

These processes are assessed to ensure:

  • the proper identification and management of risks associated with the Company’s strategic goals;
  • the accurate recording of the Company’s financial and business activities in management and external financial reports;
  • the effectiveness of the Company’s financial and business activities;
  • the protection of the Company’s assets from misconduct by employees or third parties;
  • compliance of the Company’s activities with internal regulations, legislation and contractual obligations.

The processes are reviewed by internal audit, which recommends improvements and monitors their implementation.

Internal audit also employs its knowledge and experience to provide consultancy services to the Company’s structural divisions.

 Audits were conducted in the following areas in 2018:

  • management of operating efficiency;
  • risk management;
  • management of investment activity;
  • supply management;
  • cost accounting/reporting.

The objectives, powers and responsibilities of internal audit are set out in the internal audit regulations. An updated version of these regulations was adopted by the Board of Directors in 2018.

To improve the effectiveness and quality of internal audit, the following documents were also produced and adopted in 2018:

  • internal audit quality programme;
  • internal audit guidance.