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72 Annual Report 2012
• Strategic risk
• Operational risk
• Financial risk, classified into two major types: (1) Market risk and (2) Credit risk, or clearing and counterparty risk
• Compliance risk
Risk owners, being those who manage SET operations in different functions, are responsible for identifying and
assessing key corporate risks in accordance with specified criteria. SET’s risk is managed by risk owners, who identify and assess
risk in accordance with specified criteria, provide measures to manage the risk within an acceptable level, and monitor as well as
reports on the status of these risks. In addition, risk owners regularly review the adequacy and efficiency of mitigation measures to
ensure that SET can handle incidents in timely manner. Thus in SET’s introduction of its trading system SET CONNECT, the BoG,
Audit Committee and Risk Management Committee recommended steps to be taken to manage risk prior to launching the system.
Risk management Unit (RMU) coordinates and facilitates risk owners in implementing risk management activities by:
- Establishing a Business Continuity Plan, with regular reviews; updating BCP documents and conducting exercises
annually with all related participants in the Thai capital market. As disasters may occur at any time, SET
acknowledges the importance of preparing the staff and operations for both its main and alternate sites. SET also
conducted back-up system testing with member companies to ensure continuous securities trading system if any
disruption affected its main sites.
- Regularly monitoring and reporting on organizational risk status in all functions to the BoG and RMC for
acknowledgement. In addition, in 2012, the RMU monitored and reported on progress in implementing the
recommendations of Oliver Wyman, a consultant firm specializing in risk management, on SET’s Operations Master
Plan for 2012, which included sections on risk governance and clearing risk.
- Continually inculcating a risk management culture among SET executives and employees.
- Reporting on risk operations to the RMC no less than quarterly and Audit Committee quarterly.
Based on all of the above activities, the BoG concludes that SET has adequately conducted key corporate risk
management activities (For details on the SET Group’s risk management activities, please see the risk management policy sections).
(7) Financial reports
The BoG is responsible for the financial reports of SET Group, including the information disclosed in the annual report.
The financial report’s preparation and disclosure process was established to ensure that all information is correctly and adequately
disclosed in accordance with generally accepted accounting principles and standards and truly reflected SET’s actual financial
status and operating results. The financial report was audited by an independent external auditor and approved by the Audit
Committee prior to submission to the BoG.
SET Group applied accounting policies which were suitable for its business operations. In addition, SET took into account
the issues raised by the external auditor which might have impaired the internal control system and the reliability of the financial
statements and adopted its recommendations as appropriate in light of cost-benefit analysis. (The Audit Committee’s opinion as
stated in that Committee’s report).