Audit Committee Report Reviewed non-recurrent related party transactions to ascertain that it was undertaken at arm’s length and was in the best interest of the Company. Reviewed and recommended the Corporate Governance Overview Statement, Audit Committee Report and Statement on Risk Management and Internal Control, to the Board for approval. Reviewed the Terms of Reference of the Audit Committee. Reviewed and approved the Non-Audit Services fees. Reviewed summary of whistleblowing cases. B) EXTERNAL AUDIT Engaged in dialogue with External Auditors to review:- • And be satisfied with the audit plan, audit strategy and scope of work, especially on areas identified for audit focus for the year; • The audit adjustments and issues arising from their annual audit, including their comments on the Group’s financial reporting and internal accounting control; • The audit report and key audit matters highlighted for inclusion therein and the audit process in addressing them; and • The Group’s financial reporting process including consolidation. Assessed the objectivity and independence of the External Auditors in carrying out their audit during the financial year, and this included their appointment for non-audit services. Evaluated the performance and competency of the External Auditors and recommended their re-appointment to the Board of Directors. Met with the External Auditors in May 2022, November 2022 and February 2023 without the presence of the Executive Directors and Management to review any concerns/issues affecting their audit, including the level of cooperation rendered by Management relating to their access to financial information and accounting records. Reviewed and recommended the appointment of the Company’s External Auditors for the provision of non-audit services, after assessing and considering the following:- • The nature of the non-audit provided services by the External Auditors or its affiliates and fees paid for such services relative to the audit fee; • The scope of work as required are permitted under the Malaysian Institute of Accountants By-Laws; and • The services would not impair their independence or there were safeguards against threat to the objectivity and independence of the audit arising from the provision of non-audit services or tenure of the External Auditors. C) INTERNAL AUDIT Reviewed and approved the Annual Internal Audit Plan. Assessed the overall performance of the outsourced internal auditor to ensure their effectiveness in meeting audit objectives and professional standards. Reviewed and deliberated the internal audit findings and observations arising from audits and considered their recommendations to Management for improvement in internal control process. Examined the adequacy and appropriateness of the Management’s action plans and responses to the audit findings and recommendations. INTERNAL AUDIT FUNCTION The Group outsourced its internal audit function to an independent professional consulting firm with global presence in approximately 158 countries with more than 236,000 people who are committed to delivering quality in assurance, advisory and tax services. The engagement partner is Mr. Nik Shahrizal Sulaiman, a chartered accountant (ICAEW) with relevant experience in the areas of governance, risk and controls. He also holds a Master in Business Administration. The staff involved in the reviews have the relevant training in the area of internal audit, of which some are members of the Institute of Internal Auditors Malaysia. The internal audit reviews were conducted using the firm’s risk-based Internal Audit methodology, which are guided by industry good practices including the Institute of Internal Auditors framework. The areas of coverage are driven by a risk assessment process and presented to the Audit Committee for approval. The firm has an internal policy that requires their personnel to declare their professional independence and disclose any potential conflict of interest. During the course of the internal audit engagement for the financial year ended 2023, the firm did not highlight any conflict of interest matters with regards to its personnel. Activities The activities undertaken by the internal auditors are based on the Professional Services Firm’s Internal Audit methodology, which is aligned to Institute of Internal Auditors (“IIA”) standards. Key Activities Formulated the internal audit plan and presented for the Audit Committee’s review and approval. Executed internal audit reviews on key business processes and internal controls of business units as per approved audit plan. Reported to the Audit Committee on exceptions noted and highlighted areas of improvements, after discussion with management. Audit Fees In FY2023, the total cost incurred for the internal audit function was approximately RM256,000. Audit Committee Report QL RESOURCES BERHAD INTEGRATED ANNUAL REPORT 2023 SEC. L E A D E R S H I P & G OVERNANCE 6 105 104 PG. PG.
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