ACCOUNTABILITY AND INTERNAL CONTROL

The directors are required in terms of the Act and the Listings Requirements of the JSE to prepare annual financial statements which fairly present the state of affairs of the Company and the Group as at the end of the financial year and of the profit or loss for that period, in conformity with International Financial Reporting Standards (IFRS). The Company's external auditors are responsible for examining and reporting to shareholders their opinion on the annual financial statements of the Company and its subsidiaries in order to determine whether the financial statements are in accordance with the Act, IFRS and the Listings Requirements of the JSE.

Following discussions with the external auditors the directors consider that, in preparing the financial statements, the Company has consistently used appropriate accounting policies supported by reasonable and prudent judgement and estimates. All applicable international accounting standards have been followed. The directors have formally reviewed the budgets and forecasts of the businesses and have concluded that the Group will continue in business for the foreseeable future and, accordingly, the going concern basis of accounting remains appropriate.

The directors are also responsible for maintaining adequate accounting records and they have general responsibility for ensuring that an effective risk management process is in place to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.

To enable the directors to meet these responsibilities, management sets standards and implements systems of risk management and internal control aimed at reducing the risk of error or loss in a cost-effective manner. The Company's internal audit function independently appraises the Group companies' internal controls and reports directly to the Audit and Risk Committee. In addition, the management of each operating business and corporate function submits an annual Letter of Assurance to the Audit and Risk Committee of the Company affirming that the internal controls in entities for which they have responsibility are adequate for their operations.

The directors are of the opinion, based on the information and explanations given by management, the internal auditors and the external auditors, that during the year there were no material breakdowns of internal controls and that these controls are adequate so that the financial records may be relied on for preparing the financial statements and maintaining accountability for assets and liabilities. The bad debt write-off at Chemical Initiatives highlighted certain areas for improvement in risk management, as well as the need to strengthen the internal control environment in this regard. The directors believe that assets are protected and used as intended with appropriate authorisation. The auditors concur with the above statements by the directors.