It is the policy of the Board of Directors (Board) that the Company have an audit committee whose primary objective is to facilitate the proper execution of the responsibilities of the Board of Directors relating to accounting and reporting practices of the Company.
The Committee must comprise at least two members with at least one members having financial expertise. The chairperson of the committee shall be a non-executive director and shall not also be the Chairperson of the Company. Further, the chief executive officer and chief financial officer must state in writing to the Board that the company’s financial reports present a true and fair Asia Pacific Digital, in all material respects, of the company’s financial condition and operational results and are in accordance with relevant accounting standards.
The audit committee charter is as follows:
review and report to the Board on the annual and half year financial reports, the financial section of quarterly reports and all other financial information published by the Company prior to release to members and other public forums;
assist the Board in reviewing the effectiveness of the organisations internal control environment covering:
effectiveness and efficiency of operations;
reliability of financial reporting;
compliance with applicable laws and regulations;
monitoring of corporate risk assessment processes;
co-ordinate the audit with the external auditor including reviews of internal control measures;
review and approve any significant non-mandatory accounting policy change;
review the audit plan with the external auditor;
recommend to the Board the appointment, removal and remuneration of the external auditors, and review the terms of their engagement, the scope and quality of the audit and the auditors independence, and consider if appropriate, the rotation of audit partners; and
review the level of non-audit services provided by the external auditor and ensure it does not adversely impact on auditor independence.
The audit committee has authority, within the scope of its responsibilities, to seek any information it requires from any employee or external party.
The audit committee is to meet independently of the external auditor not less than twice a year and at such additional times as the Committee decides. The Chairman may convene a meeting at any reasonable time.
The audit committee is to meet with the external auditor not less than twice a year and review any significant disagreement between the auditor and management, irrespective of whether the matters have been resolved.
The external auditor has a clear line of direct communication at any time to either the Chairperson of the audit committee or the Chairperson of the Board. Any member of the audit committee is able, and obliged, to bring any matter to the immediate attention of the Board, if that committee member believes the matter has not been dealt with adequately by the committee, or is of significant importance that the Board should be informed directly.
The Board considers that the essential responsibilities of directors is to oversee Asia Pacific Digital’s activities for the benefit of its shareholders, employees and other stakeholders and to protect and enhance shareholder value.
The Board’s primary role is the protection and enhancement of long-term shareholder value. To fulfil this role, the Board is responsible for oversight of the management and the overall corporate governance of the Company including its strategic direction, establishing goals for management and monitoring the achievement of these goals.
The composition of the Board is determined using the following principles:
a minimum of three directors, with a broad range of business expertise;
the Chairman must be non-executive;
a majority of non-executive directors, with at least two being independent non-executive directors;
directors should bring characteristics which allow a mix of qualifications, skills and experience.
The Board operates within the broad principles and responsibilities described in the following charter:
contributing to the development of and approving corporate strategy;
appointing, assessing the performance of and, if necessary removing the Managing Director/Chief Executive Officer;
contributing to the performance assessment of members of the senior management team;
reviewing and approving business plans, the annual budget and financial plans including available resources and major capital expenditure initiatives;
overseeing and monitoring:
organisational performance and the achievement of strategic goals and objectives;
compliance with the Company’s code of conduct;
progress of major capital expenditures and other corporate projects including acquisitions, mergers and divestments;
monitoring financial performance including approval of the annual, half yearly and quarterly reports and liaison with the auditor;
ensuring there are effective management processes in place, including reviewing and ratifying systems of risk identification and management, ensuring appropriate and adequate internal control processes, and that monitoring and reporting procedures for these systems are effective;
enhancing and protecting the Company’s reputation;
approving major capital expenditure, capital management, acquisitions and divestments;
reporting to shareholders;
appointment of directors; and
any other matter considered desirable and in the interest of the Company.
To assist in the execution of its responsibilities, the Board has established an Audit Committee. A separate Audit Committee Charter has been introduced.
Business risk management processes are monitored by the Audit Committee and also constantly monitored by the directors as they have a very close association with the day to day operation of the Company.
The full Board currently meets approximately every month, and will meet a minimum of eight times a year. In addition strategy meetings and any extraordinary meetings are held at such other times as may be necessary to address any specific significant matters that may arise.
The agenda for meetings is prepared in conjunction with the Chairman and other executive directors. Senior executives are regularly involved in board discussions and directors have other opportunities for contact with all employees.
The Board conducts an annual review of its processes to ensure that it is able to carry out its functions in the most effective manner.
Directors must keep the Board advised, on an ongoing basis, of any interest that could potentially conflict with those of the company.
The Company’s Code of Conduct requires that we:
Act with honesty and integrity
Respect the law and act accordingly
Respect confidentiality and not misuse information
Value and maintain professionalism
Avoid conflicts of interest
Strive to be good corporate citizens
Have respect for each other.
It is the Board’s responsibility to ensure that all staff are aware of the Code of Conduct and to ensure that any individual who does not adhere to these ideals is dealt with appropriately by executive management. Appropriate action may be counselling, disciplinary action or termination of employment.
The Board is responsible for setting the tone of legal, ethical and moral conduct to ensure that the Company is considered reputable by the industry and other outside entities. This involves considering the impact of the Company’s decisions on the industry, colleagues and the general community.
We are all responsible for maintaining this Code of Conduct and have a responsibility to report breaches of the code to executive management or an appropriate Board member.
Act With Honesty and Integrity
We are to act honestly and with integrity in our dealings on behalf of the Company, and always act in good faith and in the best interests of the Company. The Company cares about results and equally how these results were obtained. We do not use coercive or misleading practices or falsify or wrongly withhold information. All staff are under an obligation to use the Company’s funds, offices, vehicles, data, records, communications, computing facilities, and any other Company property, only for the sole pursuit of the Company’s business and not for any private or improper purpose, unless specifically authorised to do so, in each instance, by a Director of the Company. The Company seeks to be known as an organisation that does what it says it will do.
Respect for the Law and Act Accordingly
Respect for the law means that we accept and comply with the spirit, as well as the letter, of the laws and regulations and business practices wherever the Company operates and without compromising our principles or code of conduct. We notify our supervisor, manager or a board member (as appropriate) on becoming aware of any breach of a law or regulation, or instances of unethical behaviour. We maintain an approach that preserves the integrity of any laws or regulations under which we operate.
Respect Confidentiality and Not Misuse Information
We must ensure the confidential information (be it personal or otherwise) contained in Company records that avails itself to employees is strictly maintained and not disclosed to any other party within the Company or otherwise without the approval of management. Further, it is our responsibility as employees not to misuse this information. Where appropriate, confidential technical or financial information may be disclosed such as where a confidentiality agreement has been signed by the receiving party. Personal information relating to individuals is not to be provided to other employees unless it is required to perform their job. Information regarding employees is not to be released to outside parties without the consent of the relevant employee or unless required by law. The Company has issued a policy on this subject titled “Communication with Shareholders”.
Value and Maintain Professionalism is conduct which fosters and preserves our reputation as individuals and the reputation of the Company.
We are obliged to conduct ourselves ethically and to achieve the highest quality in our work. In order to achieve this, all staff of the Company have a duty to use due care and diligence in fulfilling the functions of their individual position and are responsible for improving skills, knowledge and competency required for their individual position and level of responsibility. We as employees must use the powers of office for a proper purpose, in the best interests of the company as a whole and must not take improper advantage of our position. We all have an obligation to be independent in judgment and actions and to take all reasonable steps to be satisfied as to the soundness of all decisions taken. We will not engage in conduct likely to bring discredit upon the company. We are also committed to equal opportunity in employment and will not tolerate harassment or unlawful discrimination. We are all considered part of a team and all team members are required to strive for a safe and efficient workplace.
Avoid Conflicts of Interest
We do not place ourselves in situations where our private interests could conflict directly or indirectly with our obligations to the Company. It is the responsibility of all employees to disclose any personal interest they may have in a project, company or other matter where the employee is involved in the assessment, negotiations or other activity relating to that matter. All employees and directors of the Company are required to obtain consent before accepting any directorship or other appointment to enable an assessment to be made as to whether such appointment could cause a conflict of interest which may affect objective judgment. The Company has issued a policy on this subject entitled “Policy on Dealing in Securities”.
Strive to be good Corporate Citizens
A good corporate citizen strives to act responsibly on matters such as sustainable development, health, safety, environmental and community responsibilities. These matters are integral to the way the Company conducts its business.
Have Respect for Each Other
This means we embrace diversity, enriched by openness, sharing, mutual trust, teamwork and involvement. Harassment in any form is unacceptable. Actions that constitute harassment are regarded as serious misconduct.
It is the policy of the Company to communicate effectively with its shareholders by giving them ready access to balanced and understandable information about the Company, making it easier for them to participate in general meetings.
The Company Secretary has been nominated as the person responsible for communications with the Australian Stock Exchange (ASX). This role includes responsibility for ensuring compliance with the continuous disclosure requirements of the ASX Listing Rules and overseeing and co-ordinating information disclosure to the ASX, analysts, brokers, shareholders and the public.
All information disclosed to the ASX is placed on the Company’s website as soon as it is disclosed to and acknowledged by the ASX. When analysts are briefed on the Company’s activities, the material used in the presentation (if not previously released) is released to the ASX and placed on the Company’s web site. Procedures have been established for reviewing whether any price sensitive information has been inadvertently disclosed, and if so, this information is also released to the market.
All shareholders receive a copy of the Company’s annual report. Copies of the Company’s quarterly and half yearly reports are provided to the ASX and placed on the web site. Copies of these reports are sent to any shareholder or interested party requesting a copy.
All recent reports and announcements since the Company was listed on the ASX are available on the Company’s web site.
This purpose of this document is to summarise the policies and processes of the Board of Asia Pacific Digital in relation to the release of ASX announcements (and media releases) to ensure compliance with the ASX Listing Rule disclosure requirements and to ensure accountability for that compliance. In particular this policy includes vetting and authorisation processes designed to ensure company announcements are timely, factual, complete and expressed in a clear and objective manner.
(a) Induction of Directors and Other Key Personnel All directors and senior management of Asia Pacific Digital are to be briefed on the following issues:
The type of information that needs to be disclosed.
The roles and responsibilities of directors, officers and employees of Asia Pacific Digital in the disclosure context, in particular, who has the primary responsibility for ensuring that the company complies with its disclosure obligations and who is primarily responsible for deciding what information is disclosed.
Safeguarding confidentiality of corporate information to avoid premature disclosure.
Media contact and comment.
Measures for seeking to avoid the emergence of a false market in the company’s securities.
External communications such as analyst briefings and responses to shareholder queries. The induction will be conducted by the Company Secretary.
(b) Documents to be provided
All directors and key personnel of Asia Pacific Digital are to be provided with a copy of the Guidance Note 8 of the ASX Listing Rules, which highlights the general principles and obligations set out in Chapter 3 of the ASX Listing Rules – Continuous Disclosure.
(c) The Law
The Company must comply with the law regarding continuous disclosure;
The general continuous disclosure rule is contained in the Australian Stock Exchange (“ASX”) Listing Rule 3.1. In effect, Asia Pacific Digital is obliged (subject to specific exceptions) to advise the ASX of any information that a reasonable person would expect to have a material effect on the price or value of Asia Pacific Digital’s securities;
Section 674 of the Corporations Act makes a failure to comply with Listing Rule 3.1 an offence under the Corporations Act if the failure is intentional or reckless;
The ASX has issued two sets of guidance notes to assist public listed companies in complying with Listing Rule 3.1.
The Australian Securities and Investments Commission (“ASIC”) has also issued a set of guidance principles to assist companies in complying with continuous disclosure obligations. These guidance principles are also attached.
The two sets of guidance notes/principles referred to above (“ASX/ASIC Guidance Notes”) do not have the force of law. However, Asia Pacific Digital should comply with the ASX/ASIC Guidance Notes as far as practicable.
All directors are to enter into a Director Disclosure Agreement with the Company (as set out in Guidance Note 22 of the ASX Listing Rules). The Company Secretary is to maintain records of signed copies of these agreements.
(e) Board Meetings
Continuous Disclosure matters will be on the agenda of all Board Meetings providing an overview of all issues relating to both the Company and the directors.
Release of ASX Announcements
(a) Vetting and Authorisation Processes The Company’s protocol in relation to the review and release of ASX announcements (and media releases) is as follows:
All key announcements are to be circulated to and reviewed by all members of the Board.
All members of the Board are required to provide the Chairman (or in his absence the Company Secretary) with verbal or written approval of each announcement, prior to its release.
Any relevant parties named in the announcement should also be given the opportunity to review the announcement prior to its release, to confirm all information is factually correct.
The Chairman (and in his absence the Company Secretary) is to be given the final signoff before release to the ASX.
(b) Release of Announcements
All announcements are to be released electronically, by the Company Secretary.
(c) After Release
After confirmation of the release has been obtained from ASX, the Company Secretary is to circulate the release to all members of the Board.
All announcements released are to be posted on the Company’s website as soon as practicable.
The Company Secretary is to maintain a register and copy of all announcements released.
Specific Issues in Relation to Continuous Disclosure
Company Spokesperson and Media Enquiries
(a) Asia Pacific Digital shall keep to a minimum the number of spokespersons who have authority to speak on behalf of the Company.
(b) In regard to queries from the media, the primary spokesperson for Asia Pacific Digital is the Chairman/CEO, assisted where appropriate by the EGM and the Company Secretary.
(c) The Chairman/CEO is the primary spokesperson in responding to enquiries from institutional and other large shareholders and from stockbrokers and analysts.
(d) The Company Secretary is the primary spokesperson in responding to enquiries from small shareholders.
(e) The Chairman/CEO, and Company Secretary shall each take responsibility to ensure that they are kept up to date with the status of public disclosure of information relating to Asia Pacific Digital. In addition, the Company Secretary will ensure that copies of the following documents are distributed on a timely basis to the Chairman/CEO and EGM and on a monthly basis, to the Board:
Asia Pacific Digital’s ASX announcements;
major media articles relating to Asia Pacific Digital;
major analysts’ reports on Asia Pacific Digital;
any other relevant materials.
(f) This Guideline refers to “primary spokesperson”. Where that spokesperson is not available to answer any particular enquiry, then one of the other of the Chairman/CEO, EGM or Company Secretary shall take on the responsibility for that enquiry as appropriate.
(a) Private briefings to analysts/institutions/stockbrokers are encouraged by Asia Pacific Digital to enhance a greater understanding of the Company. However, these private briefings must not involve the disclosure of price-sensitive information. If any new information is provided in the presentation, a copy must be lodged with the ASX prior to that meeting.
(b) If price-sensitive information is inadvertently disclosed at a private briefing, then the information must be announced to the ASX as soon as practicable.
(c) If an analyst asks a question at a private briefing which touches on a price-sensitive area, then the Asia Pacific Digital spokesperson can only use publicly available information in their answer. Where this is not possible, then the spokesperson should decline to answer the questions or take it on notice and answer it after a general disclosure to the ASX has been made.
(d) Where appropriate, Asia Pacific Digital spokesperson should conduct an internal debriefing procedure after every private briefing to ensure that price sensitive information has not been inadvertently disclosed.
Review of Draft Analysts’ Reports
(a) The Company may sometimes be requested to review draft analysts’ reports on Asia Pacific Digital prior to publication. These draft reports may contain financial projections.
(b) Any review of such draft reports by officers of Asia Pacific Digital will be restricted to: i. Amending factual errors; and/or ii. Reviewing underlying assumptions.
(c) Under no circumstances should the Asia Pacific Digital officer expressly or impliedly approve or disapprove the financial projections outside the information that is publicly available.
Use of the Asia Pacific Digital Website
(a) Asia Pacific Digital should use its website as much as practicable to give the public access to:
Asia Pacific Digital’s most recent Annual Report and half and full year financial statements.
Asia Pacific Digital’s announcements to the ASX (except announcements of a procedural nature that have no material effect on Asia Pacific Digital). These may include presentations used to brief analysts.
Any other information relating to Asia Pacific Digital that is considered appropriate.
(b) The Company Secretary will ensure that no inappropriate information is placed on the website. The Company Secretary will be responsible for maintenance of the website.
(c) Access to the website by investors or potential investors should be made as simple as possible. In particular, no password will be required to access this information.
ASX Queries/Market Rumours
(a) Any information relating to market rumours or leaks relating to Asia Pacific Digital must be advised to the Company Secretary as soon as possible. The Company Secretary will then take steps to ascertain as far as practicable the veracity of the leak or rumour and the degree that the leak or rumour exists in the market place.
(b) The Company Secretary must consult with the Chairman/CEO in assessing whether it is appropriate for Asia Pacific Digital to respond to the leak or rumour. If considered appropriate, the leak or rumour will be responded to by Asia Pacific Digital through an announcement to the ASX.
(c) If the ASX verbally queries Asia Pacific Digital on a leak or rumour, the Company Secretary will forthwith advise the Chairman/CEO of the query. If the ASX sends a formal written request to explain a leak or rumour, then the Company Secretary will forthwith copy that request to all directors.
(d) The Chairman/CEO, in consultation with the Company Secretary, EGM and, where appropriate, other directors will oversee the response to an ASX enquiry. Given that such enquiries usually require a quick response, some flexibility is needed in this Guideline to ensure a timely response is provided to the ASX.
Amendment of These Guidelines
These Guidelines have been adopted by the Board of Asia Pacific Digital. Any amendment to these guidelines can only be approved by the Asia Pacific Digital Board.
The Company Secretary has the responsibility of reviewing these Guidelines on an annual basis to ensure compliance with the law and corporate governance best practice.
1.1 This policy imposes constraints on Directors and Senior Executives of Asia Pacific Digital Limited (“Company”) dealing in securities of the Company. It also imposes disclosure requirements on Directors.
2.1 The objectives of this policy are to:
(a) minimise the risk of Directors and Senior Executives of the Company contravening the laws against insider trading;
(b) ensure the Company is able to meet its reporting obligations under the ASX Listing Rules; and
(c) increase transparency with respect to trading in securities of the Company by Directors and Senior Executives. To achieve these objectives Directors and Senior Executives should consider this policy to be binding on them in the absence of specific exemption by the Board.
3. Dealings in Securities – Legal and other Considerations
3.1 Sections 1042B to 1043O of the Corporations Act 2001 prohibit persons who are in possession of price sensitive information in relation to particular securities that is not generally available to the public from:
a. dealing in the securities; or
b. communicating the information to others who might deal in the securities. The central test of what constitutes price sensitive information is found in section 1042A. It provides that the insider trading and continuous disclosure rules apply to information concerning a company that a reasonable person would expect to have a material effect on the price or value of securities in the company (“price sensitive information”).
3.2 Directors and Senior Executives of the Company will from time to time be in a situation where they are in possession of price sensitive information that is not generally available to the public. Examples are the period prior to release of annual or half-yearly results to Australian Stock Exchange Limited (“ASX”) and the period during which a major transaction is being negotiated.
3.3 The risk of contravention of insider trading laws in relation to information concerning public companies was substantially reduced in 1994 with the introduction of the continuous disclosure regime. Under that regime, public companies are required to disclose regime. Under that regime, public companies are required to disclose all price sensitive information immediately to ASX, except in limited circumstances. The tests of what constitutes price sensitive information under the insider trading laws and under the continuous disclosure requirements are effectively identical. As a consequence, at least in theory, there is no risk of Directors and Senior Executives contravening insider trading laws as all relevant information will already have been disclosed.
3.4 There are a number of limitations and qualifications to the above. They include:
a. the ASX Listing Rules and the Corporations Act 2001 permit companies to not disclose certain information, for example in the situation where an acquisition is being negotiated and remains confidential;
b. in the case of a Director, information may be known to a particular Director but not yet by the Company as a whole (ie. the Board);
c. the Company may not have yet complied with its continuous disclosure obligations in relation to a particular event or circumstance – there will always be some element of delay in doing so; and
d. Directors and Senior Executives will generally have a better feel for the performance of the Company than the public. In these situations there is still potential for contravention. There is also the potential for an appearance of contravention even if there has not been actual contravention. This could reflect badly on the Company as well as on the Director or Senior Executive concerned.
3.5 Another circumstance that must be guarded against is where one or more Directors and Senior Executives are aware of an event or circumstance and the remaining Directors and Senior Executives are not yet aware. In such a circumstance it is important that no Director or Senior Executive deals in securities because:
a. there is a risk that they will be found to have been guilty of insider trading even if they had no intention of committing a contravention; and
b. of the potential for such circumstances to reflect badly on the Company. For these reasons, the advice of the Chairman should be sought prior to any dealings taking place, and steps should be taken to ensure that the Chairman is appraised of all relevant considerations by the Continuous Disclosure Manager appointed under ASX Listing Rule 1.1, condition 12.
4. Policy – Dealings in Securities
4.1 Directors and Senior Executives can deal in securities of the Company in the following circumstances:
a. they have satisfied themselves that they are not in possession of any price sensitive information that is not generally available to the public;
b. they have contacted the Chairman or in his absence, the Company Secretary and notified them of their intention to do so and the Chairman or Company Secretary indicates that there is no impediment to them doing so; and
c. where the Chairman wishes to deal is securities, he has contacted the Lead Director, or in his absence, the Company Secretary and notified them of their intention to do so and the Lead Director or Company Secretary indicates that there is no impediment to them doing so.
4.2 The Chairman will generally not allow Directors and Senior Executives to deal in securities of the Company as a matter of course in the following periods:
a. within the period of 1 month prior to the release of annual or half yearly results;
b. within the period of 1 month prior to the issue of a prospectus; and
(c) there is in existence price sensitive information that has not been disclosed because of an ASX Listing Rule exception. Directors and Senior Executives should wait at least 2 days after the relevant release before dealing in securities so that the market has had time to absorb the information. In specific circumstances however, such as financial hardship, the Chairman may waive the requirement of a Director or Senior Executive to deal in securities outside the above periods on the condition that the Director or Senior Executive can demonstrate to him that they are not in possession of any price sensitive information that is not generally available to the public.
4.3 Directors and Senior Executives must not at any time engage in short-term trading in securities of the Company.
4.4 Directors and Senior Executives must not communicate price sensitive information to a person who may deal in securities of the Company. In addition, a Director or Senior Executive should not recommend or otherwise suggest to any person (including a spouse, relative, friend, trustee of a family trust or directors of a family company) the buying or selling of securities in the Company.
5. Directors – Notification of Dealings in Securities – Legal and other Considerations
5.1 ASX Listing Rules 3.19A and 3.19B require the Company to notify dealing in securities by Directors within 5 business days. Three appendixes are included in the Listing Rules for the purpose of this notification, being 3X Initial Director’s Interest Notice, 3Y Change of Director’s Interest Notice and 3Z Final Director’s Interest Notice.
5.2 Section205G of the Corporations Act 2001 requires a Director of a listed company to notify ASX within 14 days of acquiring or disposing of a relevant interest in any securities of the Company. This is an obligation of the Director, not the Company. There is no prescribed form for such notifications. ASIC has granted relief from the requirements of section 205G where notifications are made by the Company under Listing Rules 3.19A and 3.19B.
5.3 Senior Executives are required to notify the Chairman, or in his absence, the Company Secretary of any dealings in securities within 5 business days.
6. Directors – Policy – Notification of Dealings in Securities
6.1 Directors must notify the Company Secretary immediately on acquiring or disposing of a relevant interest in any securities in the Company.
6.2 Directors have entered into an agreement with the Company under which they are obliged to notify changes in interests in shares and other relevant matters.
Explanation of Terms
For the purposes of this policy:
“deal in securities” means buy or sell shares, options or other securities in the Company, or enter into transactions in relation to shares, options or other securities in the Company. It includes procuring another person to do any of these things;
“price sensitive information” has the meaning given in paragraph 3.
For the purposes of paragraph 4, directors “dealing” includes associates of directors dealing in securities, and it is incumbent on each director to ensure that an associate does not deal in circumstances where the dealing could be attributed to the director concerned.
Asia Pacific Digital Limited ACN 000 386 685 (Company)