SARAWAK
4. Terms of Reference
The terms of reference of the Committee are as follows:
• Provides assistance to the Board in fulfilling its fiduciary responsibilities relating to corporate accounting and reporting practices for the Group;
• Maintains through regularly scheduled meetings, a direct line of communication between the Board and the external and internal auditors;
• Avails to auditors a private and confidential audience at any time they desire and to request such audience through the Chairman of the Committee with or without the prior knowledge of the Management; and
• Acts upon the Board of Directors’ request to investigate and reports on any issues or concern with regards to the management of the Group.
Audit Committee's Report
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In addition, the Committee is authorised to carry out duties as mentioned below and has unrestricted access to all of the Group’s records, properties and personnel to enable it to discharge its duties.
i. Financial Statements
• Reviews significant accounting and reporting issues, including complex or unusual transactions and highly judgmental areas, recent professional and regulatory pronouncements, and understands their impact on the financial statements.
• Reviews with management and the external auditors the results of the audit, including any difficulties encountered.
• Reviews the annual financial statements and considers whether they are complete, consistent with information known to committee members and reflect appropriate accounting principles.
• Reviews other sections of the annual report and related regulatory filings before release and considers the accuracy and completeness of the information.
• Reviews with management and the external auditors all matters required to be communicated to the Committee under generally accepted auditing standards.
• Understands how management develops interim financial information and the nature and extent of internal and external auditors’ involvement.
• Reviews interim financial reports with management and the external auditors before filing with regulators and considers whether they are complete and consistent with the information known to committee members.
ii. Internal Control
• Considers the effectiveness of the Group’s internal control system, including information technology security and control.
• Understands the scope of internal and external auditors’ review of internal control over financial reporting and obtains reports on significant findings and recommendations, together with management’s response.
iii. Internal Audit
• Reviews with management and the chief audit executive the charter, activities, staffing and organisational structure of the internal audit function.
• Has final authority to review and approve the annual audit plan and all major changes to the plan.
• Ensures there are no unjustified restrictions or limitations and reviews and concurs in the appointment, replacement or dismissal of the chief audit executive.
• At least once per year, reviews the performance of the chief audit executive and concurs with the annual compensation and salary adjustment.
• Reviews the effectiveness of the internal audit function, including compliance with The Institute of Internal Auditors’ International Standards for the Professional Practice of Internal Auditing.
• On a regular basis, meets separately with the chief audit executive to discuss any matters that the Committee or internal audit believes should be discussed privately.
iv. External Audit
• Reviews the external auditors’ proposed audit scope and approach, including coordination of audit effort with internal audit.
• Reviews the performance of the external auditors.
• Reviews and confirms the independence of the external auditors by obtaining statements from the auditors on relationships between the auditors and the Company, including non-audit services, and discussing the relationships with the auditors.
• On a regular basis, meets separately with the external auditors to discuss any matters that the Committee or
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v. Compliance
• Reviews the effectiveness of the system for monitoring compliance with laws and regulations and the results of management’s investigation and follow-up (including disciplinary action) on any instances of non compliance.
• Reviews the findings of any examinations by regulatory agencies and any auditors’ observations.
• Reviews the process for communicating the code of conduct to company personnel and for monitoring compliance therewith.
• Obtains regular updates from management and company legal counsel regarding compliance matters.
vi. Reporting Responsibilities
• Regularly reports to the board of directors about the Committee’s activities, issues and related recommendations.
• Provides an open avenue of communication between internal audit, the external auditors, and the board of directors.
• Reports annually to the shareholders, describing the Committee’s composition, responsibilities and how they were discharged and any other information required by rule, including approval of non-audit services.
• Reviews any other reports the Company issues that relate to Committee responsibilities.
vii. Other Responsibilities
• Performs other activities related to this charter as requested by the board of directors.
• Institutes and oversees special investigations as needed.
• Reviews and assesses the adequacy of the Committee’s charter annually, requesting board approval for proposed changes and ensures appropriate disclosure as may be required by law or regulation.
• Confirms annually that all responsibilities outlined in this charter have been carried out.
• Evaluates the Committee’s and individual members’ performance on a regular basis.