As a good corporate citizen the Company continues to conduct its business in accordance with the principles and system of good governance. The Company, therefore, has an Audit Committee, Corporate Secretary and Department of Internal Audit as the basic tools for implementating these principles. The Company also actively monitors existing business risks and constantly strives to anticipate and minimize these risks in accordance with prevailing policies and strategies.The Company also does not forget to give a real contribution to the surrounding community and environment by organizing a number social programs as a form of its responsibility.

DESCRIPTION OF THE BOARD OF COMMISIONERS

In accordance with the Company’s Articles of Incorporation, the Board of Commissioners and the Board of Directors are appointed by the General Meeting of Shareholders (GMS) for a term of 3 (three) years and may be reappointed.To date the Company has five (5) Commissioners, two of which are independent commissioners, who tasked with overseeing the policies and performance of the Board of Directors in carrying out the Company's business plan and encouraging the implementation of good governance within the Company. The Board of Commissioners is responsible for overseeing and assessing the management of the Company by the Board of Directors and oversee the commissions under the Board of Commissioners. 

DESCRIPTION OF THE BOARD OF DIRECTORS

The Board of Directors consists of 8 (eight) Directors, two of which are Unaffiliated Directors. The Board of Directors’ main duty is to lead and run the Company in accordance with established goals, vision and mission, and also plans and business strategies. The frequency of the Board of Directors meetings according to the applicable regulationsis 2 (two) times a year. In 2010, the Board of Directors Meeting was held as many as  6 (six) times namely on 1 February 2010, 2 March 2010, 8 April 2010, 12 August 2010, 12 November 2010 and 6 December 2010. Attendance of the Directors in the Board of Directors' Meeting is 48 percent.

DESCRIPTION OF THE REMUNERATION OF THE BOARDS OF COMMISIONERS AND DIRECTORS

The remuneration paid to the Boards of Commissioners and Directors during 2010 and 2009 is Rp 13,7 billion and Rp 11.9 billion, respectively 

AUDIT COMMITEE

The Audit Committee was established and appointed by the Board of Commissioners on 8 November 2007. Its main task is to assist the Board of Commissioners oversee the Board of Directors in carrying out the Company's business plan.The Audit Committee’s term of office is the same as the Board of Commissioners’. Currently, the Audit Committee consists of 3 (three) members including the Chairman, and must convene a general meeting at least once a year. During 2010, the Audit Committee held a meeting 2 (two) times, namely on 1 Februari 2010 and 12 August 2010, with an average attendance rate of 100 percent.
The composition of the Audit Committee is as follows:

Positition             Name                            Other Position in the Company          

Head             Widigdo Sukarman              Independent Commisioner       

Member        Thomas Bambang               Independent Commisioner 

Member        Lanny Bambang                   Independent Commisioner 

REMUNERATION AND NOMINATION COMMITEE

Until 2010, the Company does not have a Nomination and Remuneration Committee yet.

RISK MONITORING COMMITEE

The committee is chaired by the Managing Director of the Sub-holding Secretariat of the Committee namely the Risk Manager.
Permanent members consist of:
-  Sub-Holding Board of Directors / Project Directors

Temporary members consist of:
-  Related Projecct General Manager
-  Internal Audit

VISION AND MISSION

Vision
Managing risks to maximize the Company’s capability to achieve the Company’s objectives to maximize Company value and shareholders’ assets 

Mission
Actualizing the Company;s vision by developing a comprehensive risk management system and approach to anticipate, identify, prioritize and manage material risks to the achievement of the Company‘s objective

SCOPE OF RISK
Covers every important events or circumstances that may affect the achievement of the Company’s objectives, including strategic, financial, operational, hazard risks, as well as compliance with applicable laws and regulations.

THE COMPANY’S RISK MANAGEMENT POLICY
The integrated implementation of Risk Management through a multi-faceted approach or known as Enterprise Wide Risk Management (ERM), has been carried out since 2009. The progress of this implementation in 2010 was better than in 2009, wherein since the beginning of 2010 a number of projects have already made risk registers that were filtered according to a scale of priorities that was jointly discussed / approved by the respective Project Directors, including mitigation measures to be undertaken during the year 2010. From the prepared risk registers and mitigation plans, one can see a map of early year / carry over risks known as inherent risks, which will be mitigated and the implementation of mitigation monitored so that the level of risk is expected to be reduced to an acceptable residual risk. In addition to the mitigation reports, the projects will also report incidents whether regular or critical if any, on a monthly basis. The flow of reporting and ease of risk level monitoring through the risk maps still needs to be improved in order for them to become habitual for individuals and the corporate culture of the Company and become part of the Management’s decision-making processes at all levels and all business units.

THE COMPANYS RISK MANAGEMENT OFFICERS
Risk Management Manager:
Adi Subrata, 47 years old.
Concurrently serving as Controller at Ciputra Mall Jakarta and Semarang

Risk Managemant Officers
1.  Agung Trihendardoyo, 36 years old.

     Concurrently serving as Accounting Staff at Ciputra Hotel Jakarta.
2.  Rudy Sani Ramli, 42 years old.

     Concurrently serving as Human Resources Department Supervisor at Ciputra Hotel Jakarta.

3. Veronica Ria E,. 40 years old.

     Concurrently serving as Head of Human Resources at Ciputra Mall Semarang.

4.  Setyoadhi Pratomo, 46 years old.

     Concurrently serving as Head of Engineering Department at Ciputra Hotel Semarang.

5.  Ibrahim Andi, 30 years old.

     Concurrently serving as Collection Officer at Ciputra World Jakarta.

THE COMPANY’S OTHER COMMITTEES

Aside from the above mentioned, the Company does not have any other committees.

DESCRIPTION OF THE TASKS AND DUTIES OF THE CORPORATE SECRETARY

In addition to the Audit Committee, the Company also has a Corporate Secretary that functions to implement good corporate governance, primarily in the matter of disclosure of information. The Corporate Secretary is also tasked to ensure the Company complies with all provisions of the Capital Market and Financial Institutions Supervisory Agency and the Indonesia Stock Exchange, as well as serve a bridge between the Company and the public. 

DESCRIPTION OF THE IMPLEMENTATION OF INTERNAL SUPERVISION AND CONTROL

DISCLOSURE OF INFORMATION

Company without fail always apply the principle of information disclosure to all parties who need to routinely report information on the financial statements, the results of the use of IPO funds, material transactions, the General Meeting of Shareholders, the public exposure as well as other important information, in accordance with the regulations of the Capital Market Supervisory Agency and Financial Institutions as well as the Indonesia Stock Exchange. 

INTERNAL CONTROL SYSTEM

The Company has formulated an Internal Control System in the form of a series of standard policies and procedures in carrying out its operational activities as well as an information and reporting system to support management decision-making. The system continues to be improved and is to date considered quite effective in controlling and minimizing present risks.

It is the task of the Internal Audit division to ensure the existing internal control system is already well and effectively executed at every line of business, in accordance with the mission stated in the Internal Audit Charter, namely to provide objective and independent assessments as well as provide consultative services on matters pertaining to the effectiveness and adequacy of control, risk management and corporate governance.

During 2010, Internal Audit carried out the following:
•   Formulated an annual Audit Plan to audit the business units and headquarters, and has completed all the assigned

    audits as planned;

•  The scope of audit included testing and evaluating the adequacy and effectiveness of the internal control system;

•   Assessment of the effectiveness and efficiency in the areas of finance, accounting, marketing, human resources,

    operations, information technology, and other activities using the risk approach of risk (risk based audit), and detection

    of possible violations or fraud;
•   Provided suggestions on the improvements required for the internal control system, and discussed it with

     the related Director and managers;
•   Monitored the follow-up on the agreed improvements;
•   Prepared and reported the audit findings and their follow-up to the President Director;
•   Regularly reported the progress and findings of its audits and the follow-up by the Board of Directors and

    management to the Audit Committee and Board of Commissioners;
•   Evaluated the quality of the Internal Audit it conducted and carried out improvements on its audit program,

    audit techniques, reporting system as well as improves the competency of the auditors.

DESCRIPTION OF THE INTERNAL AUDIT UNIT

MISSION
Provide assurance and consultations that are independent and objective in order to enhance the value and improve the operations of the Company, through a systematic approach, by evaluating and improving the effectiveness of risk management, control and governance processes.

SCOPE OF DUTIES
Ascertain whether the risk management, control and management of the Company as designed and implemented by the management are sufficient and functioning well, including:

•    The risks have been sufficiently identified and managed.
•    Interactions with the managing parties are as they should be.
•    Important financial, managerial, and operational information is accurate, reliable, and timely.
•    Actions taken by employees are in accordance with prevailing policies, standards, procedures, laws and regulations.
•    Resources are acquired economically, used efficiently, and adequately protected.
•    Programs, Plans and Goals are achievable.
•    Quality and continuous improvements are maintained in the process of corporate control.
•    Important regulations and legislations affecting the company are known and given proper attention.

Potential improvement of management control, profitability, and corporate image can be found during the audit process, and will be communicated to the appropriate management levels. Internal Audit can also be a partner in solving management and operational issues facing the Company.

STRUCTURE AND STATUS
The strusture and status of the Internal Audit Unit is as follows:

•   The Internal Audit Unit is led by a head of the Internal Audit Unit
•   The head of Internal Audit is appointed and dismissed by the President Director with the approval

     of the Board of Commissioners.
•   The President Director can dismiss the head of the Internal Audit Unit, after obtaining approval

     from the Board of Commissioners, if the head of the Internal Audit Unit does not meet the

     requirements of an internal auditor as set forth in this charter and / or fails or is not competent in performing his duties.
•   The head of the Internal Audit Unit is responsible to the President Director.
•   Auditors serving in the Internal Audit Unit are directly responsible to the head of the Internal Audit Unit.
•   Auditors and officers serving in the Internal Audit Unit are prohibited from having dual tasks and positions in

    the operational activities of both the Company and its subsidiaries

DUTIES AND RESPONSIBILITIES

The Internal Audit Unit has the following duties and responsibilities:
•    Formulates and implements the Annual Internal Audit Plan;
•    Tests and evaluates the implementation of internal control and risk management system in accordance

      with company policy;
•    Conducts inspection and assessment of the efficiency and effectiveness of finance, accounting,

     operations, human resources, marketing, information technology and other activities;
•    Provides recommendations for improvement and objective information on the activities

     examined at all levels of management;
•    Prepares reports on audit findings and submits the same to the President Director and the Board of Commissioners; 

•    Monitors, analyzes and reports on the implementation of follow-ups on improvements it had suggested;
•    Works closely with the Audit Committee;
•    Develops a program to evaluate the quality of its internal audit activities;
•    Conduct special inspections when required.

AUTHORITY
The authority of the Internal Audit Unit includes among others:
•    Accessing all relevant information on the Company related to its duties and functions;
•    Communicating directly with the Board of Directors, the Board of Commissioners, and / or

     the Audit Committee and members of the Board of Directors,

     Board of Commissioners, and / or Audit Committee;
•    Holding regular and incidental meetings with the Board of Directors,

     the Board of Commissioners, and / or Audit Committee;
•    Coordinating audit activities with the activities of external auditors;
•    Allocating human resources, determining the frequency, selecting the subjects, determining

     the scope of tasks, and applying the techniques required to achieve the objectives of the audit.

CODE OF ETHICS

(1) PRINCIPLES
Internal Auditors are expected to implement and enforce the following principles:

Integrity
The integrity of internal auditors establishes trust and thus provides a basis for the confidence in their

expert internal audit opinions.

Objectivity
Internal Auditors demonstrate the highest level of professional objectivity in gathering, evaluating, and

communicating information about the activity or process being tested. Internal Auditors make a balanced

assessment of all relevant circumstances and are not overly influenced by their own interests

or by others in forming their expert opinions.

Confidentially

Internal auditors respect the value and ownership of information they receive and do not disclose information

without valid authority unless there is a valid obligation by law or profession to do so.

Competency

 Internal Auditors apply the necessary knowledge, skills and experience in performing its internal audit services.

(2) RULES OF CONDUCT

Integrity

•    Will carry out their work honestly, diligently and responsibly.
•    Will observe the law and make disclosures expected by the law and their profession.
•    Will not willingly be a part of any unlawful activity, or engage in actions that can eliminate the trust to the

     profession of internal audit or the internal audit department.
•    Will respect and contribute to the Company’s legitimate and ethical goals

Objectivity

•    Will not take part in any activity or any relationship that may damage or is expected to damage their

     impartial assessment. This involvement includes activities or relationships that may be contrary to

     the interests of the Company.
•    Will not accept anything that may damage or is expected to damage their professional expert opinions.

•    Will disclose all important facts that are known to them, which if not disclosed will affect the report on the

     activity under investigation.

Confidientiality
•    Will exercise caution in using and protecting information obtained during their assignment.
•    Will not use the information for any personal gain or in any way that would be contrary to the law or

     which would prejudice the legitimate and ethical objectives of the Company.

Competency

•    Will only involve themselves in service where they have the knowledge, skills and experience necessary.
•    Will perform internal audit services in accordance with the Standards for the Professional Practice of

     Internal Auditing.
•    Continuously improve their ability and the effectivenes and quality of their service.

ACCOUNTABILITY
In carrying out his duties the head of the Internal Audit Unit is responsible to the President Director and has access to the Board of Commissioners, to:

•    Submits the result of annual reviews of the adequacy and effectiveness of internal control and risk

     management of the Company's/existing business unit’s operating processes / business units there.
•    Reports important issues relating to internal control of the Company / business unit, and

     recommendations for improvements that may be made.
•    Periodically conveys the status and results of its Annual Audit Plan and the adequacy of human resources.

•    Coordinates and cooperates with other existing control functions (audit committee, external auditors, etc.).

The Company’s Internal Audit Unit is led by the Head of the Internal Audit Unit, Martin Rahardja, age 31 years, a graduate of the Faculty of Economics / Accounting

from Tarumanagara University, Jakarta.

DESCRIPTION OF THE COMPANY’S RISK MANAGEMENT

RISK MANAGEMENT EFFORTS
The Company is faced with risks in various aspects of its business. For this reason, the Company always strives to increase its efforts and improve its capabilities in risk management. All matters or incidents with risk potentials are carefully assessed through the implementation of ERM (Enterprise Wide Risk Management) in order for them not to develop and become risks. Thus, the Company is afforded the means to conduct its business prudently, and ever alert to the risks inherent in its decision-making and operational activities.

BUSINESS RISK
Every business certainly has inherent risk factors that must be given due attention because if ignored these risk factors could adversely impact operations, revenues and assets of the Company. Some of the major risks include:

Risk of Land Scarcity

Although the Company's business development plan also includes the acquisition of land in areas with high growth rates and in Jakarta’s business hub, but the availability of land in these areas is

very limited. The non-fruition of these acquisitions will impact on plans that have already been determined and risks affecting the Company’s financial condition and operating results in the

future.

Risk of Legal Uncertainties 

The Company always strives to secure the Right to Build (HGB) and the development rights over its land acquisitions. However, the absence of certainty in the legal enforcement of land laws and

the inconsistency of land rights in Indonesia carry the risk of disputes over ownership rights on land purchased from previous owners.

Risk of Property Market Fluctuations

Indonesia’s property industry is cyclical and significantly affected by changes in general and local economic conditions, such as unemployment rates, availability of financing, interest rates,

consumer confidence and demand for property, whether retail, office, hotel and housing. Thus the risk is always there where new projects can only be marketed when the market is depressed,

whereas the development, financing and use of other resources have been carried out much earlier. This kind of pressure on the Indonesian property industry could affect the Company’s business,

financial condition and results of operations.

Financial/Financing Risk

Property development requires large capital investments. The Company may find it necessary to seek additional or external financing to meet those needs. However, there is no assurance that

additional financing, both short and long term, will be available to the Company, or if available, such financing can be obtained with terms that are favorable to the Company.

Risk of Competition

In recent years, the Indonesian property industry is increasingly dominated by intense competition, not only among local property developers, but also with foreign developers. Tightening

competition can lead to increased land acquisition costs, excessive land inventory, and the slow approval process for new property development by the authorities. Everything can adversely affect

the Company’s business and performance.

Economic Risk

The property industry is faced with economic risks that include factors that both separately and jointly could adversely affect the property industry players. Fluctuations in the exchange rate of the

rupiah against the U.S. dollar, interest rates and inflation all have a major impact on the financial position of the Company, the purchasing power of consumers, consumer spending and retail

market demand.

Other Risks

The Company’s business activities can also be affected by economic, socio-political  conditions, natural disasters, terrorist attacks, fire and other risks. In order to face and mitigate those risks, the

Company has taken various steps such as maintaining the quality and uniqueness of the properties it builds, insuring its main assets, actively seeking land for new development sites, seeks

funding either through banks or corporate actions in the capital market to secure large fundings and various other programs.

DESCRIPTION OF THE COMPANY’S MARKETING ACTIVITIES
During 2010, the Company’s expenditure on all the promotional and marketing activities of all its business units amounted to Rp 22 billion.

DESCRIPTION OF THE COMPANY’S CORPORATE SOCIAL RESPONSIBILITY AND CUSTOMER CARE RELATED ACTIVITIES
As part of its commitment to its social responsibility for consumer protection, the Company provides customer care service which can be accessed via telephone or e-mail 24 hours per day for each of the Company’s line of business.

DESCRIPTION OF THE COMPANY’S RESPONSIBILITY TOWARD THE ENVIRONMENT
The Company always strives to fulfill its social responsibility to participate in protecting the environment by building and operating residential or office buildings that are environmentally friendly.

This is done by applying the concept of "Go Green" in each of the Company’s project, by utilizing as much as possible environmental technologies that can minimize energy consumption. Such as providing ventilation that produces good air circulation so as to reduce the use of air conditioning and providing yards that can be used as green open space.

LEGAL DISPUTES
The Company and its subsidiaries are not currently involved in any legal suit or case in both Indonesia and abroad, whether in the form of a lawsuit or is in the process of settlement or a lawsuit with significant impact on the financial condition, revenues, assets and business continuity of the Company and its subsidiaries.

ACCESS TO COMPANY INFORMATION AND DATA
The Company has a site that contains a variety of important information and can be accessed by the public, www.ciputraproperty.com. Investors and the public can also obtain information and further explanation regarding the Company via e-mail address and the Company in investor@ciputraproperty.com.

COMPANY ETHICS AND CODE OF CONDUCT

The Code of Conduct is a set of Corporate Governance practices that describes the values and standards of business practice adopted by the Company and is a reference for every individual who joins it, and at the same time describes to the party most interested (Shareholders) how the Company runs its business. The philosophy underlying the Company's Code of Conduct is Integrity, which is the effort to uphold honesty, ethics, and morals at work to create a conducive working climate and optimize value for shareholders in accordance with the vision and mission of the Company.The key to the success in implementing the Code of Conduct is the Cooperation and Participation of the entire management and all employees. The three points are also statements of the Company culture that are expected to become work ethics and present a positive image in the hearts of individuals and the public.Every director and employee of the Company received a copy of the Code of Conduct. All articles and rules in the Company's Code of Conduct applies to all individuals without exception. The Company will impose sanctions on managers and employees violating the stipulated regulations in accordance with prevailing Company Regulations and laws.