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INTRODUCTION

CORPORATE GOVERNANCE FRAMEWORK

The Board of Directors of Panorama Synergy Ltd is responsible for the corporate governance of the Consolidated Entity.

This Corporative Governance Statement outlines the key principles and practices adopted by the Company. These principles and practices, together with the systems of control and accountability represent the system of governance.

In formulating our governance framework the regulatory requirements of the Australian Securities Exchange (ASX) has been taken into account.

The Company has considered each of the Ten Essential Corporate Governance Principles and the corresponding Best Practice Recommendations as published by the ASX Corporate Governance Council.

The Company reviews and amends its corporate governance policies as appropriate to reflect current legislation and good practice. 

RELATIONSHIP WITH SHAREHOLDERS

The Company places a high priority on communications with and accountability to shareholders.  The Board recognises that shareholders, as the ultimate owners of the Company, are entitled to receive timely and relevant high quality information about their investment.  Similarly, prospective investors should be able to make an informed decision when considering the purchase of shares in Panorama Synergy Ltd.

To safeguard the effective dissemination of information, the Board has implemented a Disclosure Control Policy and adopted a Shareholder Communications Policy.  These policies reinforce the Company’s commitment to its continuous disclosure obligations imposed by law.

Information will be communicated to shareholders by:-

• Ensuring that published financial and other statutory reports are prepared in accordance with applicable laws and industry best practice.
• Ensuring full and timely disclosure of information about the Company’s activities. This  will be in accordance with the general and continuous disclosure principals of the ASX Listing Rules and the Corporations Act in Australia;
• Providing detailed reports from the Chairman and the Managing Director at the Annual General Meeting;

Shareholders are encouraged to attend Annual General Meetings and ask questions of Directors, and senior management.
Consistent with ASX recommendation 6.2, the auditor also attends and is available to answer questions at the Company’s Annual General Meeting.
 
In the event that shareholders are unable to attend meetings, they are encouraged to lodge proxies signifying their approval or otherwise of the business to be considered at those meetings.

BOARD OF DIRECTORS

Role of the Board

The Board guides and monitors the business of Panorama Synergy on behalf of shareholders.  The Board is responsible for setting corporate direction, defining policies and monitoring the business of the Company, to ensure it is conducted appropriately and in the best interests of shareholders.

The role of the Board is to oversee and guide the management of the Company with the aim of protecting and enhancing the interests of its shareholders, whilst taking into account the interests of other stakeholders including employees, customers, suppliers and the wider community.

The Board operates under a Charter and has a Code of Conduct which establishes guidelines for its conduct.  The purpose of the Code is to ensure that Directors act honestly, responsibility, legally and ethically and in the best interests of the Company.

The Board is responsible for setting the strategic direction and establishing goals for management and the monitoring of the achievements against these goals.

Composition of the Board

The Board comprises two Non-executive Directors, and one Executive Director who acts as both the Chief Executive Officer and Chairman.  The names of the Directors in office at the date of this report are set out in the Directors’ Report.  This information includes their status as Non-executive, executive or independent, their qualifications and experience and length of service.

The structure of the Board has evolved over time to reflect the current needs of the Company to ensure an appropriate mix of skills and experience are available to oversee the Company  and allow it to achieve its maximum potential.

Skills sets represented at Board level include managerial, technical, financial, corporate and commercial. 

Director Independence

Directors are expected to bring independent views and judgement to the Board’s deliberations.   In considering whether a Director is independent, the Board has regard to the independence criteria set out in the ASX Corporate Governance Council’s Principles of Good Corporate Governance.

Recommendation 2.4 requires listed entities to establish a Nomination Committee. During the year the Company did not have a separately established Nomination Committee. Given the current size of the Board, the Board considers this function is efficiently achieved with the Board assessing the independence of new Directors prior to appointment and periodically reviewing the independence of all Directors.

In considering Director independence the Board has had regard to Recommendation 2.1.

Mr Gurmit Singh is the sole principal of the accounting firm Athans & Taylor - Myaree.   Athans & Taylor – Myaree has provided taxation services to the Company. The Board notes the fees paid to Athans & Taylor – Myaree are not material to the Company and were not significant enough to be material to Mr Singh’s practice.  The Board also noted that three other accounting firms also provided accounting and taxation services of a material nature to the Company over the previous 18 month period.  Therefore, the Board considers Mr Singh to be independent

Recommendation 2.1 states that a majority of the Board be independent and that the Chairman be independent. At the date of this report the Company has only three Directors, two of whom serve as Chief Executive Officer and Chairman, and as Company Secretary.  By definition these two Directors are deemed not to be independent.

The Directors believe the size of the Company and the extent of its operations does not warrant an expansion of the number of Board positions.  Although the Board believes the composition of the current Board is both financially and structurally prudent at this time, it intends to increase the number of Board positions to five with three independent Directors as soon as it becomes financially prudent.

Meetings of the Board

The Board meets formally at least ten times a year. All Board members have full access to company records and are able to speak freely to all Company staff members.

Retirement and Re-election

The Constitution of the Company requires one third of the Directors, to retire from office at each Annual General Meeting.  Directors cannot hold office for a period in excess of three years without submitting themselves for re-election.  Retiring Directors are eligible for re-election by shareholders.  Details of those Directors seeking re-election at the 2008 Annual General Meeting are set out in the Directors’ Report.

The Board does not believe that any Director has served on the Board for a period which could, or be perceived to, materially interfere with his ability to act in the best interests of the Company.

Nomination and Appointment of New Directors

If it is necessary to appoint a new Director to fill a vacancy on the Board or to complement the existing Board, a wide potential base of possible candidates is considered. The Board assesses the qualifications of the proposed new Director against a range of criteria including background, experience, professional skills, personal qualities, the potential for the candidate’s skills to augment the existing Board and the candidate’s availability to commit to the Board’s activities.

If these criteria are met and the Board appoints the candidate as a Director, that Director must retire at the next following Annual General Meeting and will be eligible for re-election by shareholders at that Annual General Meeting.

New Directors appointed to the Board receive comprehensive written material regarding the Company such as:-

• Information on the financial, strategic and operational position of the Company;
• A comprehensive letter of appointment which sets out the Company’s expectations on acceptance of the position;
• A written statement which sets out the duties, rights and responsibilities they undertake on becoming a Director together with material detailing the operations, policies and practices of the Company; and
• Copies of previous minutes of Board meetings together with recent Annual Reports and interim financial statements.

Evaluation of Board Performance

Improvement in Board processes and effectiveness is a continuing objective and the primary purpose of Board evaluation is to identify ways to improve performance.  The Chairman is responsible for conducting an annual review of the Board performance.

An evaluation of the performance of the Board was carried out in the third quarter of the 2008 financial year.  The process involved a review of individuals and focused on process, structure, effectiveness and contributions. 

Knowledge, Skills and Experience

Directors are provided with papers, presentations and briefings on the Company’s operations and on matters which may affect the Company.  These are provided in addition to Board papers and are designed to assist the Directors to gain relevant and timely information to assist in their decision making process.  .

Position Descriptions

The Board has developed and adopted written position descriptions for the Chairman of the Board, the Managing Director and the Company Secretary.

These delineate the role and responsibility of each position and provide clarity on the expectations for those individuals occupying these key positions within the Company.

Conflicts of Interest

The Code of Conduct for Directors sets out the procedure to be followed if there is, or may be, a conflict between the personal or other interests of a Director and the business of the Company.  A Director with an actual or potential conflict of interest in relation to a matter before the Board withdraws from the meeting for the period the matter is considered and takes no part in the discussions or decision-making process.

Remuneration

Details of the remuneration policies and practices of the Company and the remuneration paid to the Directors (Executive and Non-executive) and Senior Executives are set out in the Remuneration Report included in the Directors’ Report.  Shareholders will be invited to consider and to approve the Remuneration Report at the Annual General Meeting in November 2008.

Independent advice

The Board may seek advice from independent experts whenever it is considered appropriate.  With the consent of the Chairman, individual Directors may seek independent professional advice, at the expense of the Company, on any matter connected with the discharge of their responsibilities.  No Director availed himself of this right during the course of the year.

BOARD COMMITTEES

Remuneration Committee

The Board considers the current size of the Company does not warrant the establishment of a Remuneration Committee.

Audit, Risk and Compliance Committee.

The Board has an Audit, Risk and Compliance Committee. The Committee monitors internal control policies and procedures designed to safeguard Company assets and maintain the integrity of financial reporting, consistent with ASX Principle 4.
The Audit, Risk and Compliance Committee for the year ended 30 June 2008 comprised three members including the following Directors:
Gurmit Singh ( Chairman )
John Richard Athans

The relevant qualifications and background of Gurmit Singh and John Athans are summarised in the Directors’ Report.

The Board considered the ASX recommendation that an audit committee have three members, and determined that due to the size and operations of the Company and the substantial expertise of the Committee’s existing members, that a total of two members was sufficient for the Committee to fulfil its role effectively.

Part of the role of the Committee is to provide a link between the Board and the external auditors.

It also provides the Board with additional assurances regarding the quality and reliability of the financial information prepared for use by the Board in determining policies or for inclusion in the Financial Statements.

The functions and responsibilities of the Committee are set out in the Audit and Risk Management Charter and include:

• Oversight of the reliability and integrity of the Company’s accounting policies and financial reporting;
• Advising the Board on financial reporting and business risk;
• Monitoring compliance with regulatory requirements
• Identifying key risks faced by the Company and ensuring appropriate risk management strategies and insurances are in place;
• Improving the quality of the accounting function
• Reviewing external audit reports to ensure that where major deficiencies or breakdowns in controls or procedures have been identified, appropriate and prompt remedial action is taken by management;
• Liaising with external auditors and ensuring that the annual audit and half year review are conducted in an effective manner; and
• Reviewing the performance of the external auditor, their qualifications and experience.

The Audit, Risk and Compliance Committee reviews the performance of the external auditors on an annual basis and can nominate and appoint external auditors at its discretion. During the year, the Committee held two meetings, both of which were attended by Gurmit Singh and John Richard Athans.

FINANCIAL REPORTING

CEO Sign-offs

In accordance with the Corporations Act 2001, ASX Corporate Governance Principle 4 (Safeguard Integrity in Financial Reporting)  relevant declaration, statements and certifications have been provided by the Chief Executive Officer in relation to the Company’s 30 June 2008 Annual Report, including financial statements.

DISCLOSURE CONTROLS

Panorama Synergy is committed to ensuring that shareholders and the market are provided with full and timely information and that all stakeholders have equal and timely access to material information concerning the Company.

The Company understands and respects that timely disclosure of price sensitive information is central to the efficient operation of the Australian Securities Exchange securities market and has adopted a disclosure policy with underlying procedures covering public announcements, the prevention of selective or inadvertent disclosure, conduct of investor and analysts’ briefings, and media communications.  This policy reflects the commitment of the Directors and management to promoting consistent disclosure practices aimed at accurate, timely and broadly disseminated disclosure of material information to the market. 

RISK MANAGEMENT

Recommendation 7.1 requires the Board establish policies on risk oversight and management. The Company has established policies on risk oversight and management and has a risk management and internal control system commensurate with its size, maturity and risk profile.

The Company’s risk management policy is to identify, assess, and mitigate risks which are deemed unacceptable to the Company.  Operational business controls have been identified and are in place to ensure unwanted threats to the business are managed.

SAFETY AND OCCUPATIONAL HEALTH

The safety, health and wellbeing of employees are important to Panorama Synergy’s operations. Appropriate measures are used to monitor and correct areas of risk. 

SECURITES OWNERSHIP AND DEALINGS

The Company has a Policy for Trading in Company Securities which is binding on all Directors. The purpose of this policy is to provide a brief summary of the law on insider trading and other relevant law, set out the restrictions on dealing in securities by people who work for or are associated with Panorama Synergy and assist in maintaining market confidence in the integrity of dealings in Panorama Synergy’s securities.

Directors and officers are subject to:

• No trading on or off market within the period of seven days prior and one day after the announcement of a price sensitive matter to the market.  The restriction is subject to requirements of continual disclosure on a timely basis.
• Not to participate in share placements for capital raisings unless same is offered to all shareholders on the same terms.

All employees are encouraged to comply with the same restrictions.

CODES OF CONDUCT

The Board has approved a Code of Conduct for Directors and Employees, which applies to all Directors and employees.

This code demonstrates and codifies Panorama Synergy’s commitment to appropriate and ethical corporate practices.  Compliance with the Codes will also assist the Company to effectively manage its operating risks and meet its legal and compliance obligation, as well as enhancing Panorama Synergy’s corporate reputation.

The principles outlined are intended to:

• Establish a minimum standard of conduct by which all Panorama Synergy employees are expected to abide;
• Protect the business interest of Panorama Synergy, it’s employees and customers;
• Maintain Panorama Synergy’s reputation for integrity; and
• Facilitate compliance by Panorama Synergy employees with applicable legal and regulatory obligations.

The Board has appointed the Company Secretary as the Company’s compliance officer in the case of employees, and the Chairman in the case of Directors and officers, as the person responsible for receiving reports of breaches of the Code and this is the mechanism by which compliance with the code is monitored.

The Company has a firm commitment to protect the privacy of any personal information that it collects and holds and recognises its obligation under the existing privacy legislation.  It has adopted a Privacy Policy which provides details on the collection and use of personal information circumstances under which it can be disclosed, management and security of personal information and how it can be accessed.

Any changes to the above Codes and Polices are considered by the Board for approval.