Risk management and internal control

The Board of Hofseth BioCare shall ensure that the Company has sound internal control and systems for risk management that are appropriate in relation to the extent and nature of the Company’s activities. The internal control and the systems should also encompass the Company’s corporate values, ethical guidelines and guidelines for corporate social responsibility.

Risk management and internal control is performed through various processes within the Company, both though the Board of Directors work and the operational management of the Company.

The Board of Directors receives on a regular basis reports from management outlining the financial and operational performance of the Company.

In connection with the budget work and approval of the budget, the Board of Directors evaluates the internal control systems and the most important risk factors that the Company may be confronted with. In view of the Company’s growth strategy the Board of Directors pays particular attention to ensuring that the internal control systems apply to all aspects of the Company’s activities. The Board of Directors also considers the need for any further measures in relation to the identified risk factors.

In line with NUES, the Board of Directors has adopted guidelines that encompass the Company’s corporate and ethical values and corporate social responsibility, cf. Section 1 (Code of Ethics).

The preparation of interim reports and annual reports shall be in accordance with Norwegian and international principles for accounting and as further set out in the rules of procedure for Board of Directors.

The Board of Directors, through its Audit Committee and together with its independent auditor, carries out an annual review of the Company’s most important areas of exposure to risk and its internal control arrangements.

The Board of Directors provides an account in the annual report of the main features of the Company’s internal control and risk management systems as they relate to the Company’s financial reporting.