Terms of Reference of Audit Committee

CONSTITUTION AND MEMBERSHIP

  1. The Audit Committee shall be appointed by the Board of Directors from amongst their members shall consist of not less than three (3) members and at least one (1) member of the committee:
    • must be a member of the Malaysian Institute of Accountants; or
    • if he is not a member of the Malaysian Institute of Accountants, he must have at least three (3) yearsí working experience and:-
      • he must have passed the examinations specified in Part 1 of the First Schedule of the Accountants Act 1967; or
      • 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
    • fulfils such other requirements as prescribed or approved by the Exchange.

  2. All members of the Committee must be Non-Executive Directors, with a majority of them being Independent Directors.

  3. No alternate director is to be appointed as a member of the Committee.

  4. The members of the Committee shall elect a Chairman who shall be an Independent Director from amongst their members.

  5. The term of office and performance of the Committee and each of its members shall be reviewed by the Board at least once every three (3) years.

AUTHORITY

  1. The Committee is authorised by the Board to investigate any matter within its terms of reference. It is authorised to seek any information it requires from the external auditors, person(s) carrying out the internal audit function or activity and any employees and all employees are directed to fully co-operate with any request made by the Committee.

  2. The Committee shall have the resources which are required to perform its duties.

  3. The Committee is authorised to obtain independent professional advice if it considers necessary.

  4. The Committee should 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.

FUNCTIONS AND DUTIES

  1. The functions and duties of the Committee shall be:-
    • To review the following and report the same to the Board of Directors:-
      • with the external auditors, the annual audit plan and special audit if necessary;
      • with the external auditors, their evaluation of the system of internal control;
      • with the external auditors, their audit report;
      • the assistance given by the employees of the Company to the external auditors;
      • the quarterly results and year end financial statements prior to the approval of the Board of Directors, focusing particularly on:
        • changes in or implementation of accounting policies and practices;
        • significant and unusual events;
        • compliance with accounting standards and other legal requirements;
        • significant adjustment arising from the audit;
        • the on-going concern assumption; and
        • major judgmental areas.
      • 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;
      • the external auditorsí management letter and managementís response;
    • To consider the major findings of internal investigations and managementís response;
    • To discuss problems and reservations arising from the audit and any matter the auditors may wish to raise for discussion or attention (in the absence of management where necessary);
    • To consider the appointment or re-appointment of external auditors, the audit fee and any question of dismissal or resignation where explanations are provided or needed.
    • To recommend the nomination of a person or persons as external auditors;
    • To perform any other functions or duties as may be agreed to by the Committee and the Board;
    • To do the following in relation to the internal audit function:-
      • review the adequacy of the scope, functions, competency and resources of the internal audit function, including the authority of the internal audit;
      • review the internal audit programme, processes and the results of the internal audit programme, processes or investigations undertaken, and where necessary, ensure appropriate actions are taken on the recommendations of the internal audit function;

QUORUM AND ATTENDANCE AT MEETING

  1. A quorum shall be two (2) members and the majority of members present must be Independent Directors.

  2. The Head of Finance, internal Auditors and representative(s) of the external auditors shall normally attend meetings. Other Board members and employees may attend meetings upon invitation of the Committee. However, at least twice in a financial year, the Committee shall meet with the external auditors, without the present of executive board members.

  3. The external auditors may request a meeting.

  4. The Secretary to the Committee shall be the Company Secretary.

FREQUENCY OF MEETINGS AND MINUTES

  1. Meeting shall be held not less than four (4) times in a financial year.

  2. Minutes of each meeting shall be circulated to each member of the Board.