Internal controls are designed to ensure that we get the right things done, for the right reasons, the right way, and at the right time. They are designed to provide reasonable assurance that risks are appropriately managed, and objectives achieved.
This is done through a form of policies, procedures, operational guidelines, instructions, information systems and monitoring and reporting processes.
Who is responsible for ESB Networks’ System of Internal Control?
The ESB Networks DAC Board has overall responsibility for reviewing, on an annual basis, the Company’s system of internal controls (including financial controls) and monitoring of its effectiveness.
The system of internal control is designed to provide reasonable but not absolute assurance against the risk of material misstatement or loss. To ensure that the internal controls are in compliance with legislation and regulations, an organisational structure has been established with clear operating and reporting procedures, lines of responsibility, authorisation limits, segregation of duties and delegated authority.
ESB Networks Internal Control Framework
Our framework includes the following;
- ESB Networks DAC Board Code of Conduct |Download PDF that requires all ESB Networks DAC Board members and employees to
maintain the highest ethical standards in conducting business.
- Clearly defined organisational structure, with defined authority limits and reporting mechanisms to higher levels of management and to the ESB Networks DAC Board which support the maintenance of a strong control environment.
- An ESB Networks governance framework which includes risk analysis, financial control review and formal annual governance compliance statements from the ESB Networks Managing Director.
- A comprehensive set of policies and procedures relating to operational and financial controls.
- Large capital projects require the approval of the ESB Networks DAC Board in line with the delegated authority levels, and are closely monitored on an ongoing basis .
- Comprehensive budgeting systems with an annual budget approved by the ESB Networks DAC Board and the Board of ESB.
- A comprehensive system of financial reporting.
- An ESB confidential helpline service to provide staff with a confidential, and if required, anonymous means to report fraud or ethical concerns.
- Whistleblowing and Protected Disclosures Policy
- Anti-Bribery, Corruption and Fraud Policy
Internal Control Monitoring
These controls are reviewed systematically by ESB Group Internal Audit. In these reviews, emphasis is focused on areas of greater risk. The ESB Networks DAC Board, ensures that there is an effective system of internal controls in place which are regularly reviewed and monitored. The process to review the effectiveness of the system of internal control includes:
- A designated risk management function in ESB Networks.
- Review and consideration of the half-yearly risk review process and regular risk management updates.
- Review and consideration of certifications from management of satisfactory and effective operation of systems of internal control, both financial and operational.
- A review of the programme of ESB Group Internal Audit and consideration of their findings and reports.
- ESB Group Internal Audit also report biannually to the ESB Networks DAC Board on the status of issues raised previously from their own reports and reports from the external auditor.
- A review of reports of the external auditor which contain details of any significant control issues identified, arising from its work as auditor.