INDEPENDENT ASSURANCE REPORT TO THE DIRECTORS OF KUMBA IRON ORE LIMITED
We have been engaged by the directors of Kumba Iron Ore Limited (Kumba) to conduct an assurance engagement in accordance with the International Standards for Assurance Engagements 3000 ‘Assurance Engagements other than audits or reviews of historical financial information’ [ISAE 3000], issued by the International Auditing and Assurance Standards Board, on selected Identified Sustainable Development Information reported in Kumba’s Sustainable Development Report 2011 (the Report), for the purposes of expressing a statement of independent assurance for the year ended 31 December 2011.
SCOPE AND SUBJECT MATTER
The subject matter of our engagement and related levels of assurance we are required to provide is as follows:
The following Identified Sustainable Development Information was selected for an expression of reasonable assurance:
- Total CO2 emissions from processes and fossil fuels in tonnes (page 76)
- Total CO2 emissions from electricity purchased in tonnes (page 76)
- Total energy use in GJ (page 75)
- Total number of Level 3, 4 & 5 environmental incidents reported (page 72)
- Fatality injury frequency rate (FIFR) (page 48)
- Lost time injury frequency rate (LTIFR) (page 48)
- Lost time injury severity rate (LTISR) (page 48)
- Total recordable case frequency rate (TRCFR) (page 48)
- Total number of new cases of occupational diseases (page 51)
- Total number of new cases of noise induced hearing loss (page 51)
The following Identified Sustainable Development Information was selected for an expression of limited assurance:
- Total amount of water used for primary activities in m3 (page 77)
- Total amount of water used for non-primary activities in m3 (page 77)
- Number of employees participating in anti-retroviral treatment (ART) (page 52)
- Percentage enrolment of estimated HIV cases in disease management programmes (DMPs) (page 52)
- Total amount spent on social and community development projects (page 65)
- Selected Mining Charter Scorecard indicators:
- The self declaration of the Global Reporting Initiative (GRI) application level. (page 1)
Our responsibilities do not extend to any other information.
RESPONSIBILITIES OF THE DIRECTORS
Kumba’s directors are responsible for the preparation and presentation of the Identified Sustainable Development Information, as incorporated in the Report, in accordance with their internally defined procedures, and for maintaining adequate records and internal controls that are designed to support the reporting process.
RESPONSIBILITY OF THE INDEPENDENT ASSURANCE PROVIDER
Our responsibility is to express a conclusion to the directors on the selected Identified Sustainable Development Information contained in the Report for the year ended 31 December 2011, based on our assurance engagement.
We consent to the inclusion of this report in the Report to assist Kumba’s members in assessing whether the directors have discharged their responsibilities by commissioning an independent assurance report from an appropriately qualified organisation, in connection with the selected subject matter.
SUMMARY OF WORK PERFORMED
We conducted our engagement in accordance with the ISAE 3000, issued by the International Auditing and Assurance Standards Board.
This standard requires that we comply with ethical requirements and plan and perform the assurance engagement to obtain either reasonable or limited assurance on the selected Identified Sustainable Development Information as per our terms of engagement. Kumba’s internal corporate reporting policies and procedures and the Global Reporting Initiative’s (GRI) G3.0 guidelines were applied as criteria for evaluating the Identified Sustainable Development Information. Definitions for the Identified Sustainable Development Information applied are those determined by Kumba and provided in the glossary on (page 99) .
Our procedures included examination, on a test basis, of evidence relevant to the selected Identified Sustainable Development Information. The procedures selected depend on the assurance provider’s judgement, including the assessment of the risks of material non-compliance of the selected Identified Sustainable Development Information with the defined reporting criteria.
Our work consisted of:
|a)||reviewing the processes that Kumba has in place for determining material Identified Sustainable Development Information to be included in the Report;|
|b)||obtaining an understanding of the systems used to generate, aggregate and report data at the sampled operations;|
|c)||conducting interviews with management at the sampled operations and at head office;|
|d)||applying the assurance criteria in evaluating the data generation and reporting processes;|
|e)||performing a controls walk-through;|
|f)||testing the accuracy of data reported on a sample basis for limited and reasonable assurance;|
|g)||reviewing the consolidation of the data at head office to obtain an understanding of the consistency of the reporting processes compared with prior years and to obtain explanations for deviations in performance trends;|
|h)||reviewing the consistency between the Identified Sustainable Development Information and related statements in Kumba’s Report; and|
|i)||reviewing the accuracy of Kumba’s self-declaration of the GRI (G3.0) Application Level in the Report.|
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our assurance conclusions.
The evidence-gathering procedures for limited assurance are more restricted than for reasonable assurance and therefore less assurance is obtained with limited assurance than with reasonable assurance.
We have not carried out any work on data reported for prior reporting periods, nor have we performed work in respect of future projections and targets. We have not conducted any work outside of the agreed scope and therefore restrict our opinion to the Identified Sustainable Development Information.
Non-financial data is subject to more inherent limitations than financial data, given both the nature and the methods used for determining, calculating, sampling or estimating such data. Qualitative interpretations of relevance, materiality and the accuracy of data are subject to individual assumptions and judgements.
Conversion factors used to derive energy used from fuel and electricity consumed are based upon information and factors derived by independent third parties. Our assurance work has not included an examination of the derivation of those factors and other third party information.
Based on our work performed, the Identified Sustainable Development Information selected for reasonable assurance, for the year ended 31 December 2011, is free from material misstatement.
Based on our work performed, nothing has come to our attention causing us to believe that the Identified Sustainable Development Information selected for limited assurance, for the year ended 31 December 2011, is materially misstated.
Director: Wessie van der Westhuizen
20 March 2012