Financial Daily from THE HINDU group of publications
Monday, Jul 01, 2002
Financial Daily from THE HINDU group of publications Monday, Jul 01, 2002 |
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Corporate
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Restructuring Dabur revamps risk management set-up — PwC appointed single internal auditor Ratna Bhushan
NEW DELHI, June 30 DABUR India Ltd has restructured its risk management set-up and appointed PricewaterhouseCoopers (PwC) as its single internal auditor. "The management evaluated various options and decided that a single service provider would suit Dabur's needs better. After detailed discussions, PwC was chosen as the internal audit service provider,'' Mr Rajan Varma, Chief Financial Officer (CFO), Dabur India Ltd, said. PwC's term with Dabur India is for a period of two years, extendable by another two years. The company has formed a five-member core group to interact and implement the recommendations of PwC, headed by Mr Varma. While Dabur had appointed PwC last year for overseeing and training local auditors, the consultancy's scope of work was limited. "With this restructuring in place, the audit responsibility of the entire organisation is with PwC,'' Mr Varma said. The move marks a significant departure from the company's decentralised transactions-based approach. Earlier, Dabur had been working with over 20 local internal audit firms. Every quarter, each local auditor would send reports to the central office for compilation. While this approach generated faster response time and involved relatively lower audit costs, besides greater involvement of internal audit firms with auditees, the approach lacked standardisation of audit methodology and scope of audit, besides involving time and effort coordinating the work of so many audit firms, Mr Varma said. The restructuring is expected to help the company move to a process-based internal audit system, achieve a balanced mix of focus between transactions and processes, and value-added recommendations resulting in transactional level process improvements. "This will help in arriving at consistency in the audit approach and methodology and better quality of audit reports, effective use of technology including PwC's proprietary audit management tools such as TeamMate 2000 in carrying out internal audits, and better governance,'' Mr Varma said. According to Mr Varma, apart from conducting risk and process-based internal audits at Dabur India's offices, subsidiaries, associate companies and select suppliers and simultaneously achieving transactional coverage, PwC's mandate will include actively pursuing the implementation of audit recommendations, and independently assessing business risks and initiatives taken up by the management to mitigate such risks. PwC will interact regularly with the management and audit committee and keep them informed of significant control lapses. Along with Dabur India Ltd, the restructured set-up covers Dabur Foods, Dabur Nepal, Dabur Research Foundation, Dabur Finance, Adbur Ltd, Dabur Ayurvedic Specialities Ltd and Dabur Pharmaceuticals Ltd. Dabur India declared sales turnover of Rs 1,280 crore for the financial year ended March 31, 2002.
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