The Audit Committee shall be appointed by the Board from amongst its Directors (except alternate directors) which fulfils the following requirements:
a) the audit committee must be composed of no fewer than three (3) members;
b) all the audit committee members must be non-executive directors, with a majority of them being independent directors; and
c) all members of the audit committee should be financially literate and at least one member of the audit committee:
i) must be a member of the Malaysian Institute of Accountants (MIA); or
ii) if he is not a member of the MIA, he must have at least 3 years’ working experience and:
aa) he must have passed the examinations specified in Part 1 of the First Schedule of the Accountants Act, 1967; or
bb) he must be a member of one of the associations of accountants specified in Part II of the First Schedule of the Accountants Act, 1967; or
iii) fulfils such other requirements as prescribed or approved by Bursa Malaysia Securities Berhad.
The members of the Audit Committee shall elect a chairman from among their number who shall be an independent director.
The Board shall, within three (3) months of a vacancy occurring in the Audit Committee which results in the number of members reduced to below three (3), appoint such number of new members as may be required to make up the minimum number of three (3) members.
The Nomination Committee shall review the term of office and performance of the Audit Committee and each of its members annually.
Rights
The Audit Committee shall, in accordance with the procedures determined by the Board and at the cost of the Company:
- have authority to investigate any matter within its terms of reference;
- have the resources which are required to perform its duties;
- have full and unrestricted access to any information pertaining to the Company;
- have direct communication channels with the external auditors and person(s) carrying out the internal audit function or activity;
- be able to obtain independent professional or other advice; and
- be able to convene meetings with the external auditors, the person(s) carrying out the internal audit function or activity or both, excluding the attendance of other directors and employees of the Company, whenever deemed necessary.
Functions
The functions of the Audit Committee shall include the following:
1. review the following and report the same to the Board:
a) with the external auditors, the audit plan;
b) with the external auditors, their evaluation of the system of internal controls;
c) with the external auditors, their audit report;
d) the assistance given by the employees of the Company to the external auditors;
e) the assessment on the competency and independence of external auditors for determination of their suitability for re-appointment;
f) the adequacy of the scope, competency and resources of the internal audit function and that it has the necessary authority to carry out its work;
g) the internal audit plan, processes, the results of the internal audit assessments or investigation undertaken and whether or not appropriate action is taken on the recommendations;
h) the quarterly results and year end financial statements, prior to the approval by the Board, focusing particularly on:
i) changes in or implementation of major accounting policy changes;
ii) significant matters highlighted including financial reporting issues, significant judgments made by management, significant and unusual events or transactions, and how these matters are addressed; and
iii) compliance with accounting standards and other legal requirements;
i) any related party transaction and conflict of interest situation that may arise within the Company or Group including any transaction, procedure or course of conduct that raises questions of management integrity;
j) any letter of resignation from the external auditors of the Company; and
k) Risk Management Framework and risk register of the Group, including corruption risks (i.e. investigation of whistleblowing reports).
2. recommend the nomination of a person or persons as external auditors.
Meetings and Reporting Procedures
1) Frequency and Notice of the Meeting
Meetings of the Audit Committee shall be held not less than four (4) times a year. The external auditors may request a meeting if they consider that one is necessary and shall have the right to appear and be heard at any meeting of the Audit Committee. The Chairman shall convene a meeting whenever any member of the Audit Committee requests for a meeting. Written notice of the meeting together with the agenda shall be given to the members of the Audit Committee and external auditors where applicable. The Chairman shall engage on a continuous basis with the Executive Chairman, the senior finance officers, the internal auditors and the external auditors in order to be kept informed of matters affecting the Company.
Other directors and employees may attend any particular Audit Committee meeting only at the Audit Committee’s invitation, specific to the relevant meeting.
2) Quorum
The quorum for a meeting of the Audit Committee shall be two (2) members provided always that the majority of the members present must be independent directors.
3) Secretaries
The Company Secretary shall be the secretary of the Audit Committee and shall maintain minutes of the proceedings of the meetings of the Audit Committee and circulate such minutes to all members of the Board.
This Terms of Reference was reviewed and approved by the board on 8 October 2021.