Currently viewing: About this report / Next: Our group structure

The Board of Directors is pleased to present the Integrated Annual Report of AfroCentric Investment Corporation Limited (“AfroCentric”) for the 2014 financial year. This report has been compiled with a view to providing our stakeholders with an integrated approach to the business, performance, governance and sustainability of our Group for the period under review and incorporates economic, social and environmental factors where appropriate.

Principles

In preparing this report, we took cognisance of the principles in the International Integrated Reporting Council (“IIRC”) Framework released in December 2013. This has promoted a more cohesive and efficient approach to corporate reporting. Our integrated annual reporting processes align to the integrated reporting requirements of the King Code of Governance Principles for South Africa 2009 ("King III Code"). AfroCentric has an Integrated Reporting Panel in place which reviews the design and the content of the report before it is published.

Furthermore, the report is prepared in accordance with International Financial Reporting Standards (“IFRS”), the Listings Requirements of the JSE Limited, the Companies Act, 71 of 2008, and the King Report and principles on Corporate Governance for South Africa.

Scope and boundaries

The scope of this report covers the AfroCentric Group of companies and its associates. A list of principal subsidiaries and associates is provided in our Group structure on pages 6 and 7. The report relates to the financial reporting period 1 July 2013 to 30 June 2014 and is available on our website, www.afrocentric.za.com, or on request from the AfroCentric Investor Relations Department. Refer to the contact details on the inside back cover.

Readers are referred to the glossary of terms used in this report on page 5.

We have used the icon to make reference to information in various sections of this report.

Stakeholder engagement

We have provided insight into the nature and quality of our relationships with key stakeholders, including how and to what extent we understand and take into account their legitimate needs and interests as well their respective contributions to our ability to create value. The three key stakeholder groups identified were shareholders, customers and employees.

Assurance

AfroCentric applies a combined assurance model, which seeks to optimise the assurance obtained from management and internal and external assurance providers. The combined assurance model which is based on three key components is summarised as follows:

Management provides the AfroCentric Board with assurance that it has implemented and monitored the Group’s risk management plan, and that it is integrated into day-to-day activities. Management is responsible for monitoring and implementing the necessary internal controls.

The Internal Audit function, overseen by the Group’s Audit Committee, assesses the effectiveness of AfroCentric’s system of internal control and risk management.

The Board has delegated certain authorities to the Board Committees in order to manage the affairs of the Board but this in no way absolves the Board, and its Directors, from the obligation to carry out their fiduciary duties and responsibilities. All Board Committees operate under written terms of reference ("the Charter") which is approved by the Board. Each quarter, all Committee Chairpersons report to the Board, either with a written report or verbally, on recent committee activities. Board Committees are permitted to receive independent, professional advice, as and when deemed necessary. There is full disclosure and transparency from these committees to the Board.

The Group receives external assurance on certain aspects of the business. For example, our external auditors, SizweNtsalubaGobodo Inc. (“SNG”) and PricewaterhouseCoopers Inc. (“PWC”), provide an opinion on the fair presentation of the Group’s annual financial statements.

The Group Audit Committee ensures that the combined assurance model introduced by the King III Code on page 109 is applied to provide a coordinated approach to all assurance activities and addresses all the significant risks facing the Group. The committee also monitors the relationship between the external service providers and the Group.

For more information on assurance, refer to the summarised corporate governance report on pages 98 to 109.

Determining materiality

Management’s interpretation of materiality determined the disclosure and topics to be covered in the report and their relevance to stakeholders with a view to providing concise, transparent and valuable information. The Group has adhered to the principles of integrated reporting and continually strives towards excellence in the integrated reporting process with a focus on measures of enhancement for future reporting.

Approval of this report

The AfroCentric Board has approved the 2014 Integrated Annual Report on page 112.

GLOSSARY