Umsobomvu Youth Fund Annual Report 2006 - Nyda

Director, Mr Vishwaprea Suparsad, passed away suddenly in February 2006. Nominationsare currently being considered for recommendation to the shareholders to replace MrSuparsad on the Board of Directors. The composition of the Board at 31 March 2006 islisted in the Report of the Directors on page 44.The Charter of the Board of Directors sets out the responsibilities of the Board.The Board, in carrying out its tasks under its Charter’s terms of reference, may obtainsuch outside or other independent professional advice as it considers necessary tocarry out its duties pursuant to the UYF. The selection and appointment of professionaladvisors shall be in accordance with the Fund’s standard procurement policies andprocesses.The Charter of the Board of Directors is inclusive of guidelines on the selection andappointment of Directors and Director Evaluation and Board Effectiveness. The CompanySecretary ensures that the Board members receive adequate induction and Directortraining. The Directors have a duty to become fully acquainted with all the operationalissues of the Fund to allow them to properly discharge their duties.The Board of Directors delegates specific authorities to the Committees of the Board andto the Chief Executive Officer. Delegating authorities to Board Committees or Managementdoes not in any way mitigate or dissipate the Directors’ duties and responsibilities.The following matters are specifically not delegated:• All matters prescribed by law and the memorandum and articles of association;• The appointment of the Chief Executive Officer; and• Accountability of Risk Management.The Board has established a number of standing committees to efficiently advancethe business of the Board, and to adequately and properly discharge Directors’responsibilities. However, the Board is ultimately accountable and responsible for theperformance and affairs of UYF.The Board will appoint the Chairpersons of the Committees of the Board and determinethe composition of the Committees. The mandates of the Committees of the Board willbe approved by the Board.In terms of Section 49 of the PFMA, the Board is the accounting authority of UYF. Thefiduciary and general duties of accounting authorities are listed in Section 50. Theseduties have been annexed to the Charter of the Board of Directors.The following Board Committees operate within written Board Committee Charters:• Investment Committee• Audit Committee• Remuneration Committee• Youth Advisory Committee (non-fiduciary committee)Investment CommitteeThe Investment Committee met twice during the year ended 31 March 2006. ThisCommittee, as at 31 March 2006, under the Chairmanship of Mr Kgomoco Diseko,has a mandate to approve projects proposed by the Management Committee with atotal exposure in excess of R5m but less than R15m per project, and ensures that theinvestments/projects adhere to the objectives and criteria of the Fund.Projects with exposures in excess of R15m are recommended to the main Board for approval.The Committee, in the year under review, approved a total of R34 million (2005: R21million) in grant funding and investments.Audit CommitteeThe Audit Committee is chaired by Ms Dumo Motau, a non-executive Board memberof UYF, and its members consist of the Chief Executive Officer, other non-executiveDirectors and an independent specialist.The Audit Committee meetings are alsoattended (by invitation) by the ChiefFinancial Officer, the Risk Manager, certainManagement and senior staff, and theFund’s internal and external auditors.The Committee’s is responsible for theensuring that UYF’s audit, financial andrisk areas address appropriate policies,internal control, internal and externalaudit matters and other issues that maybe referred by the Fund. The Committeemeets quarterly throughout the yearwith Management as well as the internaland external auditors. The auditors haveunrestricted access to the Chairperson ofthe Committee.The Audit Committee reviews the annualfinancial statements and ensures thatthese have been properly prepared byManagement and reviewed by the externalauditors before recommendation to theBoard of Directors for approval.The Charter of the UYF Audit Committeedescribes the Committee’s terms ofreference, roles and responsibilities, andis reviewed annually and approved by theBoard.The Audit Committee is supported by theRisk Management Committee.Furthermore, the Treasury Regulationsgive the Audit Committee the explicitauthority to investigate matters within itspowers, as identified in the written termsof reference. The Audit Committee mustbe provided with the resources it needsto investigate such matters and shallhave full access to information. The AuditCommittee must safeguard all informationsupplied to it within the ambit of thelaw.Remuneration CommitteeThe Remuneration Committee of theBoard, chaired by Adv Richard Moloko,a non-executive Director, and comprisingan independent non-executive specialistand other Directors, is responsible forfacilitating the determination of all theessential components of remunerationand establishing remuneration credibilitywith key stakeholders. The financialreward offered by the Fund should besufficient to attract people of the requiredcalibre. Failure to attract the right peoplewill have a negative impact on theachievement of the mandated objectivesof the Fund. The Committee can and doeshave access to independent surveys andUmsobomvu Youth Fund 2006 Annual Report33