Memorandum and Articles of association of IMSG >> 817 kb 

Combined Code

The Combined Code appended to the Listing Rules of the Financial Services Authority, which sets out the principles of good governance and the code of best practice, applies to companies listed on the official list of the Irish Stock Exchange (“ISE”) and of the London Stock Exchange (“LSE”) by virtue of the respective listing rules of the exchanges. As the shares of the Company are not officially listed on either the ISE or the LSE, the Combined Code does not apply to it.

The Directors are however committed to high standards of corporate governance and, so far as practicable given the Company’s size and constitution of the Board, the Company voluntarily complies with the Combined Code.

Board of Directors

As at 1 April 2008, the Board comprised the Chairman, three Executive Directors and three Non-Executive Directors. Follow the link to get brief biographical details of the Directors.

The Board considers each of the Non-Executive Directors to be independent.

Under the Combined Code, at least half the Board, excluding the Chairman, should comprise non-executive directors. Smaller companies are exempt from this requirement and, as such, the Company does not currently comply with it.

In accordance with the Company's Articles of Association, each Director retires and re-submits himself for re-appointment at least once every three years. All newly appointed Directors offer themselves for re-appointment at the AGM following their appointment.

Upon admission of the Company to AIM, the Company adopted the Model Code on dealings of directors and employees in securities (as set out in annex 1 of rule 9 of the Listing Rules of the FSA).

Remuneration Committee

As at 1 April 2008 the Remuneration Committee comprised Daniel Thorniley and Terry Livingstone.

The principal duties of the Remuneration Committee are to monitor, review and make recommendations to the Board on all aspects of the remuneration of the Directors of the Company and on the award of options. The Committee's policy is to establish remuneration packages that enable the Group to attract, retain and motivate Directors with the skill and experience necessary to manage a business of its size and type.

The Remuneration Committee meets at least once a year, or more frequently if required.

Audit Committee

As at 1 April 2008 the Audit Committee comprised Gregory Thain and Terry Livingstone.

The Committee reviews the financial statements and monitors financial accounting policies and procedures, including statutory and regulatory compliance, together with the interim and preliminary results and Annual Report prior to their submission to the Board. In addition, the Committee reviews management reports on accounting and internal control matters and keeps under review the cost-effectiveness and objectivity of the Auditors. The Audit Committee has primary responsibility for making a recommendation on appointment, re-appointment and removal of auditors. The Chairman of the Audit Committee reports to the Board on the outcome of the Audit Committee meetings held and the Board receives the minutes of all such meetings.

The Audit Committee meets at least once a year, or more frequently if required.

The Combined Code requires that the Audit Committee comprises at least three Non-Executive Directors, the majority of whom should be independent. Smaller companies, such as the Company, are exempt from this provision.

Nomination Committee

Appointments to the Board are approved by the Board as a whole and, as such, no Nomination Committee has been appointed. Appointments to the Board are generally selected though the engagement of independent search consultants, together with consideration of the appropriateness of any internal candidates.

Internal Control

The Board is ultimately responsible for the Group’s system of internal control and for reviewing its effectiveness in identifying, evaluating and managing the significant risks faced by the Group. It does not provide absolute assurance against material misstatement or loss.

In order to discharge its responsibility, the Board has established an organisational structure with clear operating procedures, lines of responsibility and delegated authority. The Board has delegated authority to the Audit Committee to carry out certain tasks on its behalf. The Board conducts a review, at least once a year, of the effectiveness of the Group's system of internal controls.

In particular, the Audit Committee has reviewed and updated the process for identifying and evaluating the significant risks affecting the business and procedures by which these risks are managed.

The control framework and key review processes in place over the various business operations of the Group are as follows:

• The Board sets corporate strategy and business objectives. The executive management integrate these objectives into their operational and financial business plans for presentation to the Board;
• Key elements of the Group's system of internal financial controls are as follows:
  • Financial Reporting: There is a comprehensive budgeting system with an annual budget and updated forecasts for the year which are prepared regularly. The Board reviews the Group's performance each month.
  • Operating controls: Financial and operating controls and procedures, including appropriate authorisation controls and procedures, are in place throughout the Group and are monitored via ongoing routines and special exercises.
  • Functional speciality reporting: The Group has identified a number of key areas that are subject to regular reporting to the Board, such as progress on acquisitions and other capital projects.
  • Investment appraisal: The Group has clearly identified guidelines for capital expenditure. These include an annual budget, detailed appraisal and review procedures, levels of authority and due diligence requirements.
• Executive management are responsible for the identification and evaluation of significant risks applicable to their areas of business, together with the design and operation of suitable internal controls.
• The Audit Committee's main role is to review the key risks inherent in the business and the system of control necessary to manage such risks. The Audit Committee reviews the reports prepared by management identifying and evaluating significant risks and the internal controls in place to mitigate these risks as well as reviewing external audit reports on the system of internal controls. The Audit Committee discusses with management the actions taken in relation to all problems that are identified by the Committee.
• The Board has reviewed the need to set up an internal audit function but has concluded that the size and nature of the Group's operations do not warrant such a function at present.
• The Directors believe it is not appropriate to establish a separate Risk Committee as risk identification and management is the responsibility of the full Board.

Whilst any system of internal and financial control can provide only reasonable and not absolute assurance against misstatement or loss, the Board places a strong emphasis on adherence to the Group's control framework. The Board have reviewed the effectiveness of the system of internal control through the control framework and the key review processes set out in this Report.