The board has continued implementing various aspects of compliance with King II during the financial year, as more fully detailed below.

THE BOARD

Structure of the board
QLeisure has a unitary board with a non-executive chairman. The directors bring a wide range of experience, diversity, insight and independence of judgment on issues of strategy, performance resources and standards of conduct, to the board.

Independence of the board
The roles chairman and chief executive officer are separate. The non-executive directors do not have service contracts and their remuneration is not tied to the company’s performance. Directors are entitled to ask questions of any personnel and have unrestricted access to all company documentation, information and property.

Role and Function of the Board
The board’s main responsibilities include strategy, acquisition and disinvestment policies, risk management, financing and corporate governance. In addition, the board is accountable for relations with stakeholders and is responsible for creating, protecting and enhancing the company’s wealth and resources, timely and transparent reporting and for acting at all times in the best interests of the company and its shareholders. It is the responsibility of the board to ensure a sound system of internal control to safeguard stakeholders’ interests and the company’s assets.

Appointments to the board
No formal procedure exists for appointment to the board or for the delegation of the functions of the board. Future appointments to the board will, however, are considered by the board as a whole. The chairman and chief executive officer are responsible for reviewing the content and implementation of the authorised delegation of functions and will report thereon to the board.

Board and committee meetings and attendance thereof
Directors’ board packs are prepared and distributed before each board meeting, so as to ensure that the directors are fully informed of the issues at hand and to give full consideration to all the matters under discussion.

Two board meetings were held during the financial year ended 31 August 2008 and one after the year end until the date of this report. One audit and risk committee meeting has been held during the year and one after year end. Minutes are kept of all Board and committee meetings.

The attendances of the directors as at 31 August 2008 for the year under review, taking into account their dates of appointment and/or resignation, were as follows:

Appointment of Audit, Risk and Remuneration Committee
The board established a combined audit and risk committee comprising three members namely Mr Martin Deon van Rooyen (Chairman), Mr Jack Colin Human and Mr Mark Henry Weetman, all of whom are non-executive directors. Mr Martin Deon van Rooyen has since resigned from the board and Mr Sandile Swana has been appointed as chairman of the audit and risk committee. The other two directors remain on as committee members.

Audit and Risk Committee
The company’s audit and risk committee, which will meet at least twice per year, will consist of a minimum of two non-executive directors. The company secretary is in attendance at the meetings.

The committees’ responsibilities will include reviewing the scope, quality, independence and objectivity of the statutory audit, ensuring the integrity of the company’s accounting and financial reporting system, evaluating the effectiveness of the management functions of the company and ensuring that appropriate systems are in place for monitoring risk, financial control, compliance with the law and codes of conduct and promoting the overall effectiveness of corporate governance within the group. The external auditors will be invited to attend the Audit Committee meetings and have unrestricted access to both the committee and its chairman. The committee will advise on the appointment of the external auditors, the handling of non-audit functions by the auditors and fees in respect of non-audit services.

The audit committee has been given explicit authority to investigate any matter under its terms of reference and will have access to all resources and information it requires in order to act on this authority. The audit committee will furthermore be responsible for monitoring all contracts entered into by the company in which any of the directors are either beneficially or indirectly beneficially interested so as to ensure that all such contracts are fair and reasonable and in the best interests of the company. The risk committee will be responsible for ensuring that all risks associated with the group’s operations are effectively managed in support of the creation and preservation of stakeholder value.

Remuneration Committee
The company felt that, at present, it does not require a remuneration committee as the company is currently managed by way of a management contract and this has been held over until such time as the directors believed that it becomes necessary to form this committee.

COMMUNICATION WITH STAKEHOLDERS
The company is committed to a policy of effective communication and engagement with its stakeholders on issues of mutual interest. It subscribes to a policy of open, frank and timeous communication with its stakeholders in its activities on both financial and non-financial matters.

CLOSED AND PROHIBITED PERIODS
The company enforces a restricted period for dealing in its shares, in terms of which any dealings in shares by all directors and senior personnel is disallowed by the board from the time that the reporting period has elapsed to the time that results are released and at any time that the company is trading under cautionary announcement or is in possession of price sensitive information.

COMPANY SECRETARY
The company secretary is required to provide the members of the board with guidance and advice regarding their responsibilities, duties and powers and to ensure that the board is aware of all legislation relevant to or affecting the company. The company secretary is required to ensure that the company complies with all applicable legislation regarding the affairs of the company, including the necessary recording of meetings of the board, board committees and shareholders of the company.

CODE OF ETHICS
The board subscribes to the highest level of professionalism and integrity in conducting its business and dealing with all of its stakeholders. In adhering to its code of ethics, the board is guided by the following broad principles:

• Businesses should operate and compete in accordance with the principles of free enterprise;
• Free enterprise will be constrained by the observance of relevant legislation and generally accepted principles regarding ethical behaviour in business;
• Ethical behaviour is predicated on the concept of utmost good faith and characterised by integrity, reliability and a commitment to avoid harm;
• Business activities will benefit all participants through a fair exchange of value or satisfaction of needs; and
• Equivalent standards of ethical behaviour are expected from individuals and companies with whom business is conducted.