BOARD OF DIRECTORS

Chairman and Chief Executive

Mr. Cheng Wai Chee, Christopher is the Chairman of the Board and Mr. Cheng Wai Sun, Edward is the Deputy Chairman and Chief Executive of the Group. While the Chairman of the Board is responsible for providing leadership for the Board, ensuring that all directors are properly briefed on issues arising at Board meetings and receive complete, reliable and timely information, the Chief Executive is responsible for the day-to-day management of the Group's business.

Functions and responsibilities of the Board of Directors

On 12 July 2005, the Company formalised in writing the functions and responsibilities reserved to the Board and the functions and responsibilities delegated to management as follows:

1. the Board shall approve the yearly budgets of the Company and its subsidiaries;
2. the Board shall monitor the operating and financial performance of the Company and its subsidiaries;
3. the Board shall oversee the processes for evaluation of the adequacy of internal controls, risk management, financial reporting and compliance;
4. the Board shall assume responsibility for corporate governance; and
5. the day-to-day operations of the Company and its subsidiaries is delegated to the management led by the Chief Executive.

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REMUNERATION COMMITTEE

The Remuneration Committee was formed on 12 July 2005. The Remuneration Committee's terms of reference specify that the committee must comprise of at least three members and the majority of whom are independent non-executive directors.

The duties and functions of the Remuneration Committee are:

1. recommendation of remuneration policy and structure for directors and senior management;
2. determination of remuneration packages of executive directors and senior management;
3. review and approval of performance-based remuneration for executive directors and senior management; and
4. recommendation of remuneration packages for non-executive directors.

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AUDIT COMMITTEE

The Audit Committee was formed on 9 March 1999. The terms of reference of the Audit Committee specify that the committee must comprise of at least three members and the majority of whom are independent non-executive directors.

The duties of the Audit Committee shall be:

1. to consider the appointment of the external auditor, the audit fee, and any questions of resignation or dismissal;
2. to discuss with the external auditor before the audit commences, the nature and scope of the audit, and ensure co-ordination where more than one audit firm is involved;
3. to review the interim and annual financial statements before submission to the Board;
4. to discuss problems and reservations arising from the interim and final audits, and any matters the auditor may wish to discuss (in the absence of management where necessary);
5. to review the external auditors management letter and management's response;
6. to review the Company's statement on internal control systems prior to endorsement by the Board;
7. to review the internal audit program, ensure co-ordination between the internal and external auditors, and ensure that the internal audit function is adequately resourced and has appropriate standing within the Company;
8. to consider the major findings of internal investigations and management's response; and
9. to consider other topics, as defined by the Board.

For details of Corporate Governance Report, please refer to the Annual Report.

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