Annual Report 2017

62 Annual Report 2017 3. Internal Audit and Internal Control Realizing the importance of efficient internal control | at all levels, the BoG has strongly supported management in setting up transparent working processes, restructuring and segregating duties with checks and balances, clearly specifying authority and putting things in writing. Monitoring system has also been set up. The BoG has appointed an Audit Committee to supervise and review SET’s internal control system to ensure conformity with international standards and the Internal Audit Department review internal control in various systems such as operation process, financial reporting and compliance with rules and regulations of the regulator to ensure that SET operations are based on the internal control guidelines and framework of The Committee of Sponsoring Organization of Tradeway Commission (COSO). The Internal Audit Department is an independent function that reports directly to the Audit Committee on audit matters. Administrative matters have to be reported directly to the SET president. Audit Committee members consider the appointment, transfer or removal, and evaluate the Head of the Internal Audit Department. In 2017, Chanapai Supphasuk was Head of the Internal Audit Department. The Internal Audit Department is independent in the access of necessary information for auditing. The Internal Audit Department audits and evaluates the adequacy, suitability and efficiency of the internal control system of various procedures and systems according to SET’s annual audit plan, developed by using a risk-based approach which reviewd annually to match with change of risks, to be approved by the Audit Committee. The audit findings and follow-up results on the management’s operation have been directly reported to the Audit Committee continuously. In 2017, SET carried out important activities and projects that supported the enhancement of effective internal control system and internal audit, which can be summarized as follows: • SET emphasized the importance of compliance with rules and regulations of the regulator and conformity with international standards. The internal Audit Department has reviewed the prepareness to ensure that SET operations comply with related rules, regulations and standards. • SET developed the computer system to support new businessses such as Fund Connext and Start-up platform, with emphasis on good internal control, with intensive testing. The Internal Audit Department was assigned to conduct a pre-implementation review of the new system before the launch. SET also recognizes the importance of security of Information Technology system and has been certified by ISO 27001 and ISO 20000. • The Internal Audit Department has continuously improved the quality of internal audit through training for general audit skills and specialized skills such as the trip to visit the Stock Exchange in Germany (to learn about internal audit and risk management, corporate governance and regulatory compliance); attending “Asia Pacific CACS 2017” seminar at United Arab Emirates and “Global IA Leadership summit” seminar in Singapore; including attending the seminars for ISO 27001 Lead Auditor and ISO 22301 Lead Auditor certification. The training involved 76.5 man-days. • SET carried out a Quality Assessment Review (QAR) to assess the effectiveness of Internal Audit’s activities based on the International Professional Practices Framework. The Internal Audit Department conducts “peer review” assessment every year and hires external independent appraisers every five years for efficiency in line with international standards. The last assessment by external independent appraisers was in 2016.