Terms of Reference of The Audit Committee
The Audit Committee ("AC") is established in 2001 by the Board of Directors ("Board") of the Company. The principal objectives of the AC are to assist it in discharging its statutory duties and responsibilities relating to corporate governance, risk management, accounting and reporting practices and oversee the compliance with the relevant rules and regulations governing listed companies. The AC shall be assisted by the management who is responsible for establishing and maintaining those controls, procedures and processes and the independent internal and external auditors.
The AC shall be appointed by the Board and comprise of no fewer than 3 members of whom a majority must be independent directors. No alternate director shall be appointed as a member of the AC. At least one member of the committee shall be a registered member of the Malaysian Institute of Accountants or have at least 3 years working experience and qualified pursuant to Part I or Part II of the 1st Schedule of the Accountants Act, 1967.
The members of the AC shall elect a chairman from among their number who shall be an independent director. In the event of any vacancy in an AC resulting in non-compliance, the vacancy shall be filled within 3 months. The Board must review the term and office of an AC and each of its members at least once every 3 years.
Any former key audit partner will need to observe a cooling-off period of at least two (2) years post engagement before being appointed as a member of the AC.
The AC shall hold at least 4 meetings per year. Upon the request of the external auditor, the Chairman of the AC shall convene a meeting of the committee. Other directors and employees may attend any particular committee meeting only at committee's invitation, specific to the relevant meeting. The AC shall regulate its own procedure of meetings.
A minimum of two (2) members, with a majority of independent directors, shall form the quorum.
The AC shall report its proceedings regularly to the Board.
RESOLUTIONS AND PROPOSALS BY CIRCULATION AND MEETING USING
The AC is allowed to carry out its resolutions by way of circulation. A resolution in writing signed or approve by letter, electronic mail, telegram, telex or telexfax or other form of electronic communication by a simple majority of the AC, shall be valid effectual as if it had been passed at a meeting of the AC duly called and constituted.
The AC may meet together for dispatch of business, adjourn, and otherwise regulate their meetings as they think fit by means of any communication technology by which all persons participating in the meeting are able to hear and be heard by all other participants without the need for a AC to be in the physical presence in the meeting. The AC participating in any such meeting shall be counted in the quorum for such meeting. All effective as a resolution passed at a meeting in person of the members duly convened and held.
The AC shall not be delegated with decision-making powers but shall report its recommendations to the full Board for decision.
(1) The AC's functions are review the following and report the same to theb Board:-
- the audit plan and the audit report with the external auditor;
- the evaluation of the system of internal controls with the external auditor;
- the assistance given by the employees of the Company to the external auditor;
- the adequacy of the scope, functions and resources of the internal audit functions and that it has the necessary authority to carry out its work;
- the internal audit programme, processes, 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 functions;
- the quarterly results and year end financial statements prior to the approval by the Board, focusing particularly on the changes in or implementation of major accounting policy changes, significant and unusual events and compliance with accounting standards and other legal requirements;
- 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;
- any letter of resignation from the external auditor of the Company;
- whether there is reason (supported by grounds) to believe that the Company's external auditor is not suitable for re-appointment;
(2) Recommend the nomination of person or persons as external auditors.
The AC shall, in accordance with a procedure to be determined by the directors 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 persons carrying out the internal audit functions or activity;
- be able to obtain independent professional or other advise; and
- be able to convene meetings with the external auditors, excluding the attendance of the executive members of the committee, whenever deemed necessary.