a. The CFM Audit Committee shall be appointed by the Board from amongst their number and shall consist of not less than three (3) members. All the Audit Committee members must be non-executive directors, with a majority of them being independent directors.
b. At least one member of the Committee must be qualified under paragraph 15.09(1)(c) and 15.10 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“MMLR”).
c. Alternate director(s) cannot be appointed as member(s) of the Committee.
d. The Chairman, who shall be elected by the Committee, shall be an independent director.
e. In the event of any vacancy in the Committee that results in non-compliance of paragraph 15.09(1) of the MMLR, the vacancy shall be filled within three (3) months.
The Audit Committee shall, at the Company’s expense, have the following authority and rights:-
a. to investigate any activity within its terms of reference. It is authorized to seek any information it requires from any employee and all employees are directed to co-operate with any request made by the Committee;
b. to obtain independent professional advice and to secure the attendance of outsiders with relevant experience and expertise at its meetings if it considers this necessary;
c. full and unrestricted access to any information and documents from the external auditors and senior management of the Company and the Group which are relevant to the activities of the Company;
d. be provided with the necessary resources which are required to perform its duties;
e. have direct communication channel with the external auditors and persons carrying out the internal audit function of the Company;
f. be able to convene meetings with the external auditors, the internal audit consultants or both, excluding the attendance of other directors and employees of the Group, whenever deemed necessary; and
g. may extend invitation to other non-member directors and officers of the Company to attend a specific meeting, whenever deemed necessary.
The Committee shall report to the Board of Directors either formally in writing, or verbally, as it considers appropriate on the matters within its Terms of Reference.
The duties of the Committee shall be :-
a. to discuss with the external auditors before the audit commences, the nature and scope of the audit, the audit plan and ensure co-ordination where more than one (1) audit firm is involved;
b. to review with the external and internal auditors, their evaluation of the system of internal controls;
c. to review with the external auditors, their audit report;
d. to review the assistance given by the Company’s officers to the external auditors and to meet with the external auditors without executive board members present at least twice a year;
e. to review the quarterly results and year end financial statements of the Company and the Group, prior to the approval by the Board, focusing particularly on:
a. changes in or implementation of major accounting policy changes;
b. significant matters highlighted including financial reporting issues, significant judgments made by management, significant and unusual events or transactions, and how these matters are addressed;
c. significant adjustments arising from the audit;
d. the going concern assumption; and
e. compliance with accounting standards and other legal requirements;
f. to re view any related party transactions that may arise within the Company or Group;
g. to review the adequacy of the scope, functions, competency and resources of the internal audit consultants and to ensure that it has the necessary authority to carry out its work;
h. to review any internal audit programme, processes, the results of the internal audit programme, processes or investigations undertaken and whether or not appropriate action is taken on the recommendations of the internal audit consultants;
i. to discuss problems and reservations arising from the interim and final audits, and any matter the external auditors may wish to discuss (in the absence of management, where necessary);
j. to take cognizance of resignations of internal audit staff members and provide the resigning staff member an opportunity to submit his/her reasons for resigning, if the staff member concerned so desires;
k. to consider the nomination of external auditors and recommend to the Board of Directors for their appointment and the level of their fees;
l. to consider any resignation or removal of the external auditors, and to furnish such written explanation or representation from the external auditors to Bursa Malaysia Securities Berhad;
m. to review and monitor the suitability and independence of external auditors, to obtain written assurance from the external auditors confirming that they are, and have been, independent throughout the conduct of the audit engagement in accordance with the terms of all relevant professional and regulatory requirements.
n. to review whether there is reason (supported by grounds) to believe that the external auditors are not suitable for re-appointment;
o. the Chairman of the Audit Committee should engage on a continuous basis with senior management, the head of internal audit and the external auditors in order to be kept informed of matters affecting the Company; and
p. to undertake such other functions as may be agreed by the Audit Committee and the Board of Directors.
4. Meetings of the Audit Committee
Meeting shall be held not less than four
Majority members present in person who are independent directors shall be a quorum.
The Company Secretaries shall be the Secretaries of the Committee.
5. Performance Review
The term of office and performance of the CFM Audit Committee and each of its members shall be reviewed by the Nomination Committee of the Company annually to determine whether the Committee and its members have carried out their duties in accordance with these Terms of Reference.