Annual Report 2016
31
INTERNAL AUDIT FUNCTION
The Company has outsourced its internal audit function to an independent professional consulting firm and, together with
the group’s designated Risk Management Manager, are tasked to provide assurance to the Audit Committee and the Board
on the adequacy and effectiveness of the internal control systems and risk management processes in the Company and
its subsidiary companies. This function also acts as a source to assist the Audit Committee and the Board to strengthen
and improve current management and operating style in pursuit of best practices. During the financial year, the major areas
of work performed by the Internal Audit are as follows:-
•
Reviewed the effectiveness and adequacy of the existing control and procedures and perform compliance testing to
ensure that the controls in place are adhered to effectively;
•
Issued audit reports to the Audit Committee detailing the findings from the systems review and compliance test including
recommendations for improvements;
•
Identified, understand and managed risks embedded in the processes and activities that could negatively impact the
achievement of the Company’s objectives;
•
Assessed the risk profile of the Group by carrying out risk identification and assessment, including priotizing the
strategic risks, business risks and operational risks; and
•
Performed follow-up on recommendations for improvement made to ensure that appropriate corrective actions were
implemented on a timely basis.
During the financial year, the total cost incurred for the internal audit function is RM250,000.
TERMS OF REFERENCE OF AUDIT COMMITTEE
The Audit Committee is governed by the following terms of reference:
1. MEMBERSHIPS
The committee shall be appointed by the Board of Directors of the Company from amongst the Board and shall consist
of not less than three (3) members, majority of which shall comprise of independent directors. At least one member
must be a member of the Malaysian Institute of Accountants or eligible for membership.
In the event of any vacancy in an audit committee resulting in the non-compliance with the above, the Board shall,
within three (3) months of that event, fill the vacancy.
The members of the Committee shall elect a Chairman from among their members who shall be Independent Director.
The terms of office and performance of an audit committee and each of its members should be reviewed by the Board
at least once a year.
2. AUTHORITY
The Committee is authorised by the Board to investigate any activity within its terms of reference. It shall have
resources which are required to perform its duties. It is authorised to seek any information it requires from any employee
and all employees are directed to co-operate with any request made by the Committee. It shall have direct
communication channels with the external auditors and person(s) carrying out the internal control function or activity.
The Committee is authorised by the Board to obtain outside legal or other independent professional advice and secure
the attendance of outsiders with relevant experience and expertise if it considers this necessary.
The Committee shall report to the Board.
Audit Committee Report
(Cont’d.)
