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IFRS & Corporate Self-enforcementRussian Corporate Governance Roundtable meeting

Murray Easton, Controller TNK-BP

12 November 2004

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A Framework for Self Enforcement

Corporate Governance

ExternalAudit

ExternalMarkets

Regulatory Environment

Consolidation, Conversion & Disclosure

Accounting

Internal Approval

FS Preparation

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Basis of FS Preparation

RAS

‘Top-down’ ‘Bottom-up’

Subsidiary Accounting

Group Consolidation RAS

Corporate Control Convert

Financial Statements IFRS

IFRS

IFRS

Review

IFRSExtentof

Self-Enf

• shallower scope• higher risk

• deeper scope• lower risk

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Enforcement & Assurance

FS Approval

Board of DirectorsAudit CommitteeExecutive Mgt

FS Preparation

Accounting &

Reporting

Enforcement - procedures - compliance

Assurance - people - communication

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1. Implementation: • Planning & Preparation

• Education & Training

• Resources & Organisation

• Setting Corporate Expectations

• Role of Controller

• Internal Control Review

• Internal Audit

Enforcement - making it happen …

2. Expectations:

3. Compliance:

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1. Executive challenge: • Internal due diligence

• Business accountability

• Risk Management

• Data + Dialogue = Quality

• Internal Auditor

• Statutory Auditors

Assurance - making it happen properly

2. Other Sources: