lbma responsible gold guidance - iso 19011 refiner assessment … · lbma responsible gold guidance...

LBMA Responsible Gold Guidance - ISO 19011 Refiner Assessment Report Report Distribution List: Mint and Refinery Operation Department

BANGKO SENTRAL NG PILIPINAS

PT TUV Rheinland Indonesia

LBMA Chief Executive

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ASSESSMENT INFORMATION Refiner Name: Mint and Refinery Operation Department

BANGKO SENTRAL NG PILIPINAS Refiner Location: East Avenue, Diliman, 1101 Quezon City, Philippines Refiner Contact Person: Name, Title: Email: Phone:

Ms. Ma. Cecilia Santos; Officer In Charge [email protected] +63-2-988-4641

Lead auditor and audit team members Abdul Qohar Satria Wira Nayoan

Dates and places where the onsite

assessment activities were conducted

03.11.2016 - 04.11.2016 Quezon City, Philippines

LBMA Refiner Assessment Report

Assessment objectives: The objectives of the assessment were to evaluate the conformity and consistency of the Refiner’s management system procedures processes and practices with the LBMA Responsible Gold Guidance.

Assessment scope: Refiner location(s) included in the assessment scope

Refiner: Mint and Refinery Operation Department East Avenue, Diliman, 1101 Quezon City, Philippines Gold Buying Station:

1. Quezon City 2. Baquio 3. Davao 4. Naga 5. Zamboanga

Assessment Period 24.10.2015 - 02.11.2016

Assessment methodology: Assessment was taken at Mint and Refinery Operation Department – Refinery Processing, Gold Buying Station at Quezon City and Baguio. Each sections/area relevant for LBMA Responsible Gold Guidance was audited and verified by documentation review and management/employee interviews including the verification on production and refining facilities, raw material warehouse, finished goods warehouse and transaction area by observation during the facility tour. The scope of the assessment cover for Refiner’s systems, policies, procedures, processes and activities The evidence of compliance that was reviewed included:

• The following areas of the facility were visited during the tour:

At Mint and Refinery Operation Department – Refinery Processing:

o Gold-bearing Receiving Process

o Gold-bearing Material Inventory Control Process

o Chlorination Process

o Aqua Regia Process

o Melting Process

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o Casting Process

o Quality Control Process

o Finished Goods (Vault) Control Process

At Gold Buying Station (Quezon City and Baguio) o Gold-bearing Receiving Process o Gold-bearing Material Inventory Control Process

• The following interviews were conducted with management: o Ms. MA Cecilia Santos

o Ms. Catherine Pinky Regala

o Mr. Jose H.N Filoteo o Mr. Rodolfo Ronquillo II

• The following interviews with employees were conducted: o Ms. MA Cecilia Santos (officer in charge of Mint & Refinery Operation Department) o Ms. Catherine Pinky Regala (Director of System & Method Office) o Mr. Kristofferson Ignacio (opening) o Mr. Jose H.N Filoteo o Mr. Rodolfo Ronquillo II o Mr. Timothy Joseph Tomas o Ms. Apple Catingco o Mr. Alexander C. Ubaldo o Mr. Christian J. Rafols o Mr. Rogel Joseph del Rosario (Director of LA Union Regional Office) o Mr. Arsenio Bellen Jr. (Bagiuo Gold Buying Station) o Ms. Shirley Ann Nierva (Bagiuo Gold Buying Station) o Ms. Gina F. Delizo (Bagiuo Gold Buying Station) o Ms. Araceli B. Cayso (Bagiuo Gold Buying Station)

Statement of the confidential nature of the contents: All the data contained in the assessment report, as well as all information obtained during the performance of the certification, is private and confidential between the auditing body and the Refiner

Any significant or inherent limitations or areas not covered that were within the assessment scope: None

Assessment criteria:

• The assessment team performed the LBMA Responsible Gold Guidance assessment refer to planned arrangements for the relevant management standards, legal and contractual requirements and other requirements to which the Refiner is committed.

• The assessment team took into account all relevant objective evidence provided by the Refiner. Relevant evidence was either qualitative or quantitative in as far as it is appropriate and sufficient to support the assessment team’s conclusions. Appropriate evidence is

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evidence that is relevant and reliable. Sufficient evidence refers to the amount of evidence provided to allow the assessment team to reach a conclusion.

• Any actual or potential gaps in the Refiner’s systems in regards to the LBMA requirements are rated in accordance to the level of risk each presents to the credibility and integrity of the LBMA Responsible Gold Programme for the responsible sourcing of gold-bearing materials.

• The assessment team present and explain all nonconformities found within assessment period to Senior Management and staffs during closing meeting. Senior Management accepts all NCs and commits to follow up.

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Assessment findings: Category/subcategory Non-compliance/Observation:

Include evidence found to

substantiate the non-compliance as

well as frequency of its occurrence.

Recommended corrective action

Timeframe for implementing corrective actions

Refiner comments

Step 1.3 Non-compliance: The refresher training for persons who involving of gold transaction (Ms. Gina F. Delizo, Ms. Shirley Ann Nierva, Ms. Araceli B. Cayso) were not available

Conduct refresher training/provide briefing to identified personnel

Dec 2016 Informed and requested Head of concerned Gold Buying Station (GBS) to immediately provide training/briefing to identified personnel regarding BSP’s Responsible Gold Sourcing Policy and procedures. On 08 Nov 2016, Baguio GBS forwarded the Minutes of Meeting and Attendance Sheet on the briefing given to personnel involved in gold-buying transactions as proof of compliance (Annex 1). Conduct of refresher training shall be reminded to GBS especially for those involved in gold-buying transactions.

Step 2.2 Non-compliance: The risk assessment are not conducted annually as required by Procedure Assessment of Seller PM-SPC-02-32-020 revision 3 for: 1. JB Mgt. Mining Corp (Gold

Seller from Davao): the last risk assessment conducted on 20-Oct-2015 meanwhile there were transaction on 11-May-2016 & 10-Oct-2016

Conduct risk assessments for the identified gold-supplying counterparties.

Dec 2016 Informed and requested Heads of GBS and their compliance officers to update risk assessments (seller and origin) for the identified gold supplying counterparties in compliance with the requirement of annual reassessment. On 10 Nov 2016, copies of Risk Assessments from identified gold supplying counterparties were forwarded by the Naga and Davao Gold-Buying

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2. Antonio A. Antonio (Gold Seller from Naga): the last risk assessment conducted on 29-Sept-2015 meanwhile there was transaction on 3-Feb-2016

Stations as proof of compliance (Annex 2 and Annex 3) Further, a reminder shall be given to all GBS to conduct risk assessments of gold supplying counterparties on their every gold-buying transaction with the BSP.

Observation: The updating of contact point in BSP official website should updated accordingly when there is changes such as the contact of BSP Gold Buying Station for Quezon City is Jimmie Villar Diaz that already retired.

Dec 2016 Noted. MROD shall request updating of contact points relevant to the BSP Gold Buying program in the BSP website.

Observation: The list of Gold Seller to be submitted to SITD for background investigation should cover the existing valid of Gold Seller regardless there are transaction or not

Dec 2016 Noted. MROD shall include all sellers in the succeeding requests for background investigation whether or not they have recently transacted with BSP. We shall also inform all GBS to do the same.

Observation: The lot. no. that stated in Stock Transfer Ticket should accurate consistently

Dec 2016 Noted and corrected. Reminder shall be given to concerned personnel on the accurate/consistent documentation.

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Assessment conclusions Compliant Low Medium High Zero Tolerance

Based on the above assessment conclusions,

the overall rating of the Refiner’s performance

is determined to represent:

10 2 0 0 0

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ADDITIONAL ELEMENTS Assessment plan:

The on-site assessment at each of the selected sites of the Refiner is composed of four (4) parts:

1. Opening meeting;

2. Review of objective evidence by means of observation, documentation and interviews;

3. Evaluation of the evidence presented to determine compliance with LBMA requirements;

4. Closing meeting.

Day 1 agenda for Abdul Qohar at Quezon City (Refiner location)

a. 08:00-08:30: Opening meeting with facility management to review the purpose, scope and methodology of the assessment and clarify required documentation

b. 08:30-12:00: Senior Management: - Management commitment - Supply chain of gold policy - Internal management structure to Gold support supply chain due diligent - Internal system of due diligent, controls and transparency over gold supply chain, including

traceability and identification of other supply chain actors - Company engagement with gold-supplying counterparties - Company-wide communication mechanism to promote broad employee participation and

risk identification to management - Report on supply chain due diligence - Training - Role and responsibility

c. 12:00-13:00: break

d. 13:00-16:00: Compliance Officer and Risk Assessment Team: - Documentation of risk assessment - Risk identification, risk assessment and risk reporting of Gold supplying counterparties - Risk Mitigation strategy and due diligent - Sampling on Risk Assessment and Due Diligent for Gold Supplying Counterparties - External communication - Contracting of Gold bearing material - Gold bearing material receive transaction - Control and storage of Gold bearing material - Review transactional document of Gold bearing material

e. 16:00-17:00: Internal Assessment team meeting: - Review day findings

Day 1 agenda for Satria Wira Nayoan at Baguio Gold Buying Station

a. 04:30-09:00: Travel from Makati to Baguio

b. 09:00-10:00: Senior Management: - Management commitment - Supply chain of gold policy - Internal management structure to Gold support supply chain due diligent - Internal system of due diligent, controls and transparency over gold supply chain, including

traceability and identification of other supply chain actors - Company engagement with gold-supplying counterparties - Company-wide communication mechanism to promote broad employee participation and

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risk identification to management - Training - Role and responsibility

c. 12:00-13:00: break

d. 13:00-15:00: Gold Sourcing Process & Receipt and inventory or raw material: - External communication - Contracting of Gold bearing material - Gold bearing material receive transaction - Control and storage of Gold bearing material - Review transactional document of Gold bearing material

e. 15:00-20:00: Travel back to Makati

Day 2 agenda:

a. 08:00-10:00: Management Representative: - Melting process - Refining (chlorination and aqua regia) process - Quality Control process - Control and storage of Gold bearing material - Handling of suspected high risk raw material and finished goods - Quarantine area and identification

b. 12:00-13:00: Break

c. 14:30-15:30: auditor review findings

d. 14:30-15:30: Closing Meeting: - Presentation of findings including the nonconformity(s) - Result and conclusion - Commitment to submit the corrective action on nonconformity(s) - Statement of confidentiality

List of attendees of opening and closing meeting

Mr. Abdul Qohar Mr. Satria Wira Nayoan Ms. Ma. Cecilia Santos Ms. Catherine Pinky Regala (opening) Mr. Kristofferson Ignacio (opening) Mr. Jose H.N Filoteo Ms. Fay de Guzman (opening) Mr. Salvador Y. Del Mundo (opening) Ms. Raquel Barrientos Mr. Rodolfo Ronquillo II Mr. Timothy Joseph Tomas Ms. Apple Catingco

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Refiner feedback

Improvements shall be implemented to address the assessment findings/observations under category/subcategory 2.2. Conduct of refresher training shall be reminded to all gold-buying stations especially for involved personnel. We shall remind personnel of accurate/consistent documentation of processes and transactions.

+*a&tr

The Auditors confirm that:{ The information provided by the Refiner is true and accurate to the best

knowledge of the Auditor(s) preparing this report.

r' The findings are based on verified Objective Evidence relevant to the time periodfor the assessment, traceable and unambiguous.

/ The Audito(s) have acted in a manner deemed ethical, truthful, accurateprofessional, independent and objective.

{ The Auditor(s) are properly qualified to carry out the assessment at this Refiner'sfacility.

Lead Auditor: Abdul Qohar

Date: 2016-12-23

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LBMA Responsible Gold Guidance - Summary Assessment Report Based on ISO19011:2011.

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ASSESSMENT INFORMATION

Refiner Name: Mint and Refinery Operation Department BANGKO SENTRAL NG PILIPINAS

Refiner Location: East Avenue, Diliman, 1101 Quezon City, Philippines Refiner Contact Person:

Name, Title: Email: Phone:

Ms. MA Cecilia Santos; officer in charge [email protected] +63-2-988-4641

Assessment period: 24.10.2015 - 02.11.2016

Lead auditor and audit team members Abdul Qohar Satria Wira Nayoan

Dates and places where the onsite

assessment activities were conducted

03.11.2016 - 04.11.2016 Quezon City, Philippines

Assessment scope:

Refiner location(s) included in the assessment scope

Refiner: Mint and Refinery Operation Department East Avenue, Diliman, 1101 Quezon City, Philippines Gold Buying Station:

1. Quezon City 2. Baquio 3. Davao 4. Naga 5. Zamboanga

Assessment Period 24.10.2015 - 02.11.2016

Assessment methodology: Assessment was taken at Mint and Refinery Operation Department – Refinery Processing, Gold Buying Station at Quezon City and Baguio. Each sections/area relevant for LBMA Responsible Gold Guidance was audited and verified by documentation review and management/employee interviews including the verification on production and refining facilities, raw material warehouse, finished goods warehouse and transaction area by observation during the facility tour. The scope of the assessment cover for Refiner’s systems, policies, procedures, processes and activities]

The evidence of compliance that was reviewed included:

• The following areas of the facility were visited during the tour:

At Mint and Refinery Operation Department – Refinery Processing:

o Gold-bearing Receiving Process

o Gold-bearing Material Inventory Control Process

o Chlorination Process

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o Aqua Regia Process

o Melting Process

o Casting Process

o Quality Control Process

o Finished Goods (Vault) Control Process

At Gold Buying Station (Quezon City and Baguio) o Gold-bearing Receiving Process o Gold-bearing Material Inventory Control Process

• The following interviews were conducted with management: o Ms. MA Cecilia Santos

o Ms. Catherine Pinky Regala

o Mr. Jose H.N Filoteo o Mr. Rodolfo Ronquillo II

• The following interviews with employees were conducted: o Ms. MA Cecilia Santos (officer in charge of Mint & Refinery Operation Department) o Ms. Catherine Pinky Regala (Director of System & Method Office) o Mr. Kristofferson Ignacio (opening) o Mr. Jose H.N Filoteo o Mr. Rodolfo Ronquillo II o Mr. Timothy Joseph Tomas o Ms. Apple Catingco o Mr. Alexander C. Ubaldo o Mr. Christian J. Rafols o Mr. Rogel Joseph del Rosario (Director of LA Union Regional Office) o Mr. Arsenio Bellen Jr. (Bagiuo Gold Buying Station) o Ms. Shirley Ann Nierva (Bagiuo Gold Buying Station) o Ms. Gina F. Delizo (Bagiuo Gold Buying Station) o Ms. Araceli B. Cayso (Bagiuo Gold Buying Station)

Any significant or inherent limitations or areas not covered that were within the assessment scope: All areas within the assessment scope relevant for LBMA Responsible Gold Guidance are assessed.

Assessment criteria:

• The assessment team perform the LBMA Responsible Gold Guidance assessment refer to planned arrangements for the relevant management standards, legal and contractual requirements and other requirements to which the Refiner is committed.

• The assessment team took into account all relevant objective evidence provided by the Refiner. Relevant evidence was either qualitative or quantitative in as far as it is appropriate and sufficient to support the assessment team’s conclusions. Appropriate evidence is evidence that is relevant and reliable. Sufficient evidence refers to the amount of evidence provided to allow the assessment team to reach a conclusion.

• Any actual or potential gaps in the Refiner’s systems in regards to the LBMA requirements are rated in accordance to the level of risk each presents to the credibility and integrity of the LBMA Responsible Gold Programme for the responsible sourcing of gold-bearing materials.

• The assessment team present and explain all nonconformities found within assessment period to Senior Management and staffs during closing meeting. Senior Management accept all NCs and commit to follow up.

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Assessment findings: Category/subcategory Non-compliance/Observation:

Include evidence found to

substantiate the non-compliance

as well as frequency of its

occurrence.

Recommended corrective action Timeframe for implementing corrective actions

Refiner comments

Step 1.3 Non-compliance: The refresher training for persons who involving of gold transaction (Ms. Gina F. Delizo, Ms. Shirley Ann Nierva, Ms. Araceli B. Cayso) were not available

Conduct refresher training/provide briefing to identified personnel

Dec 2016 Informed and requested Head of concerned Gold Buying Station (GBS) to immediately provide training/briefing to identified personnel regarding BSP’s Responsible Gold Sourcing Policy and procedures. On 08 Nov 2016, Baguio GBS forwarded the Minutes of Meeting and Attendance Sheet on the briefing given to personnel involved in gold-buying transactions as proof of compliance (Annex 1). Conduct of refresher training shall be reminded to GBS especially for those involved in gold-buying transactions.

Step 2.2 Non-compliance: The risk assessment are not conducted annually as required by Procedure

Conduct risk assessments for the identified gold-supplying counterparties.

Dec 2016 Informed and requested Heads of GBS and their compliance officers to update risk assessments (seller and origin) for the

of 8

Assessment of Seller PM-SPC-02-32-020 revision 3 for: 1. JB Mgt. Mining Corp

(Gold Seller from Davao): the last risk assessment conducted on 20-Oct-2015 meanwhile there were transaction on 11-May-2016 & 10-Oct-2016

2. Antonio A. Antonio (Gold Seller from Naga): the last risk assessment conducted on 29-Sept-2015 meanwhile there was transaction on 3-Feb-2016

identified gold supplying counterparties in compliance with the requirement of annual reassessment. On 10 Nov 2016, copies of Risk Assessments from identified gold supplying counterparties were forwarded by the Naga and Davao Gold-Buying Stations as proof of compliance (Annex 2 and Annex 3) Further, a reminder shall be given to all GBS to conduct risk assessments of gold supplying counterparties on their every gold-buying transaction with the BSP.

Observation: The updating of contact point in BSP official website should updated accordingly when there is changes such as the contact of BSP Gold Buying Station for Quezon City is Jimmie Villar Diaz that already retired.

Dec 2016 Noted. MROD shall request updating of contact points relevant to the BSP Gold Buying program in the BSP website.

Observation: The list of Gold Seller to be submitted to SITD for background investigation should cover the existing valid of Gold Seller regardless there are transaction or not

Dec 2016 Noted. MROD shall include all sellers in the succeeding requests for background investigation whether or not they have recently transacted with BSP. We shall also

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inform all GBS to do the same.

Observation: The lot. no. that stated in Stock Transfer Ticket should accurate consistently

Dec 2016 Noted and corrected. Reminder shall be given to concerned personnel on the accurate/consistent documentation.

ASSESSMENT CONCLUSIONS

CATEGORY Compliant Non compliance – risk level

Low Medium High Zero Tolerance

Step 1: Establish strong company management systems

4 1 0 0 0

Step 2: Identify and assess risk in the supply chain

2 1 0 0 0

Step 3: Design and implement a management strategy to respond to identified risks

2 0 0 0 0

Step 4: Arrange for an independent third-party audit of the supply chain due diligence

1 0 0 0 0

Step 5: Report on supply chain due diligence

1 0 0 0 0

Non Compliance – risk level

Compliant Low Medium High Zero Tolerance

Based on the above assessment conclusions,

the overall rating of the Refiner’s performance

is determined to represent:

10 2 0 0 0

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The Counties of Origin of mined gold: The countries of origin of mined gold list:

1. Philippines

t$*

il$LBMA

The Auditors confirm that:r' The information provided by the Refiner is true and accurate to the best knowledge

of the Audito(s) preparing this report.

{ The findings are based on verified Objective Evidence relevant to the time periodfor the ascessment, traceable and unambiguous.

r' The Auditor(s) have acted in a manner deemed ethical, truthful, accurateprofessional, i ndependent and objective.

{ The Auditor(s) are properly qualified to carry out the aesessment at this Refiner'sfacility.

Lead Auditor: Abdul Qohar

Signature:

Date: 2016-12-23

*

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