(Company No. 58476-A)
(Incorporated in Malaysia)
AUDIT COMMITTEE - Terms of Reference
The Audit Committee (“AC”) wherever necessary and reasonable for the performance of its duties, shall in accordance with the procedures determined by the Board of Directors (“the Board”) and at the cost of the Company:
1) have authority to consider and investigate any matter within its terms of reference;
2) have the resources which are required to perform its duties;
3) have full and unrestricted access to any information of the Company;
4) assist the Board in fulfilling its fiduciary responsibilities relating to corporate accounting and financial reporting practices for the Company;
5) be able to obtain external or independent professional advice and may invite outsiders with relevant experience to attend their meetings, if necessary;
6) have direct communication channels with the external auditors and persons carrying out the internal audit function or activity;
7) be able to convene meetings with the external auditors, the internal auditors or both, excluding the attendance of other directors and employees of the Company, whenever deemed necessary;
8) make recommendations for improvements of operating performance based on internal and external audit recommendations; and
9) to ensure compliance with listing requirements and any other applicable laws and regulations.
1) The Committee shall be appointed by the Board among their members and shall comprise of no less than three (3) Directors, a majority of whom shall be Independent Directors. All members of the Committee shall be Non-Executive Directors. No member of the Committee shall be:
2) The members of the Committee shall elect a Chairman from among their members who shall be an Independent Non-Executive Director.
3) At least one (1) member of the Committee:
4) If a member of the Committee resigns, dies or for any reason ceases to be a member with the result that the number of members is reduced to below three (3), the Board shall, within three (3) months of that event, appoint such new members as may be required to make up the minimum number of three (3) members.
5) The term of office and performance of the Committee and each of its members will be reviewed by the Board at least once every three (3) years. However, the Committee member will cease to become a member when he ceases to be a Director.
1) A quorum shall consist of a minimum of two (2) members, the majority of members present must be Independent Non-Executive Directors. In the absence of the Chairman, the members present shall elect a Chairman for the meeting from amongst the members present.
2) Minutes of each meeting shall be kept and distributed to each member of the Committee and of the Board. The Chairman of the Committee shall report on each meeting to the Board.
3) The Committee shall meet not less than four (4) times a year. In addition, the Chairman may call a meeting of the Committee if a request is made by any committee members, the Chairman/Managing Director or the internal or external auditors if they consider it necessary. Notice of meetings shall be circulated to the members one (1) week in advance or at a shorter notice as may be agreed by all the members of the Committee.
4) Notwithstanding the above, upon the request of the external auditors, the Group internal auditor or the Executive Directors, the Chairman of the Committee shall convene a meeting of the Committee to consider the matters brought to its attention.
5) Questions arising at any meeting shall be decided by a majority vote, each member having one (1) vote and in the event of a tie, the Chairman shall have a second or casting vote. However, at meetings where two (2) members form a quorum, or when only two (2) members are competent to vote on an issue, the Chairman will not have a casting vote.
6) The Secretary to the Committee is, but need not be, the Company Secretary.
7) The Group Financial Controller or equivalent, the Group internal auditor or equivalent and a representative of the external auditors shall normally attend meetings. Other Board members may attend meetings upon the invitation of the Committee. However, the Committee shall meet with the External Auditors without the presence of the Executive Board members and employees of the Company at least twice a year and whenever necessary.
8) A committee member shall be deemed to be present at AC meeting if he participates by instantaneous telecommunication device and able to communicate clearly with all other committee members. The participation constitutes prima facie proof of recognition.
The functions of the Committee have been expanded to include matters specified in the Main Market Listing Requirements, Malaysian Code on Corporate Governance 2012 and other necessary provisions.
1) External Audit
a) To consider and recommend the appointment of the external auditors, the audit fee and any questions of resignation, dismissal or reappointment.
b) To discuss with the external auditors before the audit commences, the audit plan, the nature and scope of the audit, and ensure co-ordination when more than one (1) audit firm is involved.
c) To review and discuss with the external auditors the followings:
2) Internal Audit
(a) To review the adequacy of the scope, functions, competency and resources of the internal audit function, and that it has the necessary authority to carry out its work;
(b) To review the internal audit programme, processes and the results of the internal audit programme, processes or investigation undertaken and whether or not appropriate action is taken on the recommendations of the internal audit function;
(c) To review any appraisal or assessment of the performance of members of the internal audit function;
(d) To approve any appointment or termination of senior staff members of the internal audit function; and
(e) To take cognisance of resignations of internal audit staff members and provide the resigning staff member an opportunity to submit his reasons for resigning.
3) Financial Reporting
To review the quarterly results and year-end financial statements of the Company and the Group, and to recommend the same to the Board for approval, focusing particularly on:
4) Risk Management
To review the risk management process to ensure it fulfils the Group’s strategic objectives and for the practice of good governance in the organisation.
5) Related Party Transactions
To review any related party transactions and conflict of interest situation that may arise within the Company or the Group including any transaction, procedure or course of conduct that raises questions of management integrity.
To consider the major findings of internal investigations and management’s response and to perform any other functions as the Committee considers appropriate or as authorised by the Board.