Petoro - a driving force on the Norwegian continental shelf

SDFI and Petoro annual report 2013

Risk management and internal control

Risk management in Petoro supports the company’s strategy and goals. The board undertakes an annual review of the company’s most important risk areas and its internal control process. In this review, the board gives weight to the risks and opportunities which Petoro itself can influence through its own measures within the frameworks available to it. 
The most important operational risks are followed up in the management committees for the priority fields/joint ventures. Petoro works continuously on maturing and developing risk management in line with principles for integrated management and the development of the company’s risk picture. These principles build on the internationally recognised Coso/ERM framework for internal control, and on the company’s internal expertise.
Identification and management of risk and risk exposure form part of Petoro’s business processes. The company works with risk management to handle conditions which could affect its ability to reach specified targets and to implement chosen strategies, as well as those which could affect its ability to submit accurate accounts. Risk management is an important tool for reducing uncertainty in Petoro’s strategy and performance-monitoring processes, and for creating understanding of the risk picture across the business.

The internal control function at Petoro is charged with ensuring that the business is conducted in accordance with the established governance model and that requirements specified by the government are observed. This function forms an integrated element in Petoro’s management processes, and is responsible for ensuring that integrity and completeness are assessed for all management information and that management systems are effective.

The framework for internal control has been formulated to provide a reasonable level of assurance that goals will be met in the following areas:
  • purposeful and cost-effective operation
  • reliable reporting of accounts
  • compliance with applicable law and statutory regulations.
Petoro’s internal audit function is provided by an external audit company, which audits the internal control systems in accordance with its instructions and an annual plan approved by the board.
Guidelines have been adopted by Petoro to facilitate internal reporting of conditions in the business which are open to criticism. Whistleblowers who want to preserve their anonymity or who do not wish for other reasons to raise the matter with their superior can notify the internal auditor.