Terms of Reference

Composition of Audit Committee

Composition and Designation

  1. Mr Phong Hon Wai (Chairman)
    (Independent Director)
  2. Brig. Gen. (R) Dato’ Mohd Zaaba @ Nik Zaaba Bin Nik Daud(Member)
    (Non-Independent Non-Executive Director)
  3. Ms Lim Lay Ching (Member)
    (Independent Director)

Terms of Reference of Audit Committee

Composition of the Committee

  1. The Committee shall be appointed by the Board of Directors from amongst its board members which fulfils the following requirements:-
    1. must compose of no fewer than three (3) members;
    2. must be non-executive director, with a majority of them being independent directors;
    3. at least one member of the audit committee:-
      1. must be a member of the Malaysian Institute of Accountants (“MIA”); or
      2. if he is not a member of the MIA, he must have at least three (3) years’ working experience and:-
        • he must have passed the examinations specified in Part I of the 1st Schedule of the Accountants Act 1967; or
        • he must be a member of one of the associations of accountants specified in Part lI of the 1st Schedule of the Accountants Act 1967; or
      3. fulfils such other requirements as prescribed or approved by the Exchange.
    4. shall not comprise of any alternate director of the Company.
    5. any former key audit partner must have observed a cooling-off period of at least 2 years before one is eligible for appointment as Audit Committee member
  2. In the event of any vacancy in an audit committee resulting in the non-compliance of the above, the Company must fill the vacancy within three (3) months.
  3. The Nominating Committee must review the term of office and performance of the Committee and each of its members annually to determine whether such Committee and members have carried out their duties in accordance with their terms of reference.

Duties and Responsibilities of the Committee

The Committee shall discharge the following functions:-
  1. review the following and report the same to the Board of Directors:-
    1. with the external auditor:-
      1. the audit plan which comprises audit and non-audit services;
      2. his evaluation of the system of internal controls; and
      3. his audit report;
      4. audit approach, including coordination of audit efforts with internal auditors, and the assistance given by the employees of the Company to the external auditors;
      5. external auditors’ management letter and management’s response thereto; and
      6. any significant audit findings, reservations, difficulties encountered or material weaknesses reported by the external auditors.
    2. with the internal auditors:-
      1. the adequacy of the scope, functions, competency and resources of the internal audit functions (which reports directly to the Committee) and that it has the necessary authority to carry out its work;
      2. the internal audit plan, 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 function;
    3. review the appraisal or assessment of the performance of the Internal Audit ("IA") function and performance of the Head of IA, who is appointed to be responsible for the regular review and/or appraisal of the effectiveness of the risk management, internal control and governance processes within the Group, and submit the outcome of performance assessment of the Head of IA to the Nominating Committee for determination of reward allocation.
    4. the quarterly results and year end financial statements, prior to the approval by the board of directors focusing particularly on:-
      1. changes in or implementation of major accounting policy changes;
      2. significant matters highlighted including financial reporting issues, significant judgment made by Management, significant and unusual events or transactions and how these matters are addressed;
      3. significant adjustments arising from the audit; and
      4. compliance with accounting standards and other legal requirements;
    5. the annual performance assessment, including suitability, objectivity and independence of the external auditors in accordance with the Auditor Independent Policy, which takes into consideration the following:-
      1. the competence, audit quality and resource capacity of external auditors in relation to the audit;
      2. 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, including the By-laws (on Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants.
    6. the Statement on Risk Management and Internal Control to be published in the Annual Report;
    7. 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;
    8. any letter of resignation from the external auditors or suggestions for their dismissal;
    9. whether there is reason (supported by grounds) to believe that the Company’s external auditor is not suitable for re-appointment; and
    10. to review an new grants and the allocation of Employees’ Share Options ("ESOS") for employees in accordance with the By-Law.
  2. recommend the appointment, re-appointment and removal of a person or persons as external auditors.
  3. report promptly to the Exchange where the Committee is of the view that a matter reported by it to the board of directors has not been satisfactorily resolved resulting in a breach of the Listing Requirements.
  4. handle matters related to the whistleblowing as follows:
    1. recommend the nomination of a person or persons as the members of Whistleblowing Committee (WBC);
    2. review the terms of reference, activities and complaints presented by the WBC and decide on the appointment of appropriate party to carry out an investigation for significant cases;
    3. report the investigation results/findings and recommend the actions to be taken to the Board of Directors.
  5. prepare Audit Committee Report annually concerning its activities in compliance with these terms and reference to be tabled to the Board and for inclusion in the Annual Report; and
  6. carry out any other function that may be mutually agreed upon by the AC and the Board

Rights of the Committee

The Committee shall, in accordance with a procedure to be determined by the board of directors and at the cost of the Company,:-
  1. have authority to investigate any matter within its terms of reference;
  2. have the resources which are required to perform its duties;
  3. have full and unrestricted access to any information pertaining to the Company;
  4. have direct communication channels with the external auditors and person(s) carrying out the internal audit function or activity;
  5. be able to obtain independent professional or other advice;
  6. 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 and such meetings with the external auditors shall be held at least twice a year; and
  7. recommend to the Board of Directors any appropriate changes to the duties of the AC.

Procedure of Committee Meeting

  1. The Chairman shall be elected by the Committee from among their members who shall be an independent director. The AC Chairman shall not be the Chairman of the Board.

    If at any meeting the Chairman is not present within fifteen (15) minutes after the time appointed for holding the meeting, the members present shall choose one of their numbers, to act as the Chairman of the meeting.

  2. The majority of members who must be the independent directors present at the meeting shall be a quorum.
  3. The Head of Finance, the representatives from the internal and external auditors shall normally attend the meeting. Other directors and employees attend any particular audit committee meeting only at the Committee’s invitation, specific to the relevant meeting. The Committee may invite any person to be in attendance to assist in its deliberations.

    The Company Secretary shall act as the secretary of the Committee during his/her term of appointment.

  4. Any member may at any time and the Head of Finance and the Secretary shall on the requisition of any of the members or the external auditors summon a meeting.

    The meetings may be conducted by means of telephone conference, video conference or any other form of audio or audio-visual instantaneous communication and the participation in the meeting pursuant to this provision shall constitute presence in person of such meeting.

  5. Meetings shall be held at least four (4) times a year to review the quarterly results and year end financial statements.
  6. A resolution in writing signed by all members of the Audited Committee for the time being entitled to receive notice of an Audit Committee meeting, shall be as valid and effectual as if it had been passed at a meeting of the Audit Committee duly convened and held.

    Any resolution coming within the provisions of this Regulation may consist of several documents in like form, each signed by one or more member of the Audit Committee.

    Any such document may be accepted as sufficiently signed by a member if transmitted to the Company by any technology purporting to include a signature and/or an electronic or digital signature of the member.

  7. Except in the case of an emergency, reasonable notice of every meeting shall be given in writing and the notice of each meeting shall be served to any member either personally or sending it by facsimile transmission or email transmission or through the post or by courier to such member to his/her registered address as appearing in the Register of Directors, as the case may be.

    The notice and agenda shall be distributed to all members about seven (7) days before the meeting.

  8. A resolution put to the vote of the meeting shall be decided on a show of hands. In the case of an equality of votes, the Chairman shall be entitled to a second or casting vote.
  9. The minutes shall be signed by the Chairman of the meeting which the proceedings were held or by the Chairman of the next succeeding meeting and shall be circulated to the Committee and the Board of Directors.
  10. The minutes shall be kept by the Company at the Registered Office or the principal place of business in Malaysia of the Company, and shall be opened to the inspection of any member of the Committee without charge.

Composition of Nominating Committee

Members and Designation

  1. Mr Phong Hon Wai (Chairman)
    (Independent Non-Executive Director)
  2. Brig. Gen. (R) Dato’ Mohd Zaaba @ Nik Zaaba Bin Nik Daud(Member)
    (Non-Independent Non-Executive Director)
  3. Ms Lim Lay Ching (Member)
    (Independent Non-Executive Director)

Objective

  1. Selection of candidates and assessing of directors on an ongoing basis.
  2. Contribute towards ensuring the board composition meets the needs of the Company.

Terms of Reference of Nominating Committee

  1. The members of the Committee shall be elected by the Board of Directors from amongst themselves and the Committee shall consist of not less than two (2) members who are exclusively non-executive directors, the majority of whom must be independent directors.

    In the event of any vacancy in the Committee resulting in the non-compliance of the above, the Company must fill the vacancy within three (3) months.

    The Board of Directors must review the term of office and performance of the Committee and each of its members at least once every three (3) years to determine whether the Committee and its members have carried out their duties in accordance with the Committee’s terms of reference.

  2. The Chairman of the Committee should be the Independent Director or the Senior Independent Director identified by the Board.
  3. The Secretary of the Committee shall be the Company Secretary of the Company.
  4. The Committee may meet together for the dispatch of business, adjourn and otherwise regulate their meetings, at least once a year or more frequently as deemed necessary.

    The Chairman may call for additional meetings at any time at his discretion.

    The Secretary shall at the requisition of the members of the Committee summon a meeting of the Committee and except in the case of an emergency, reasonable notice of every Committee meeting shall be given in writing.

    The meetings may be conducted by means of telephone conference, video conference or any other form of audio or audio-visual instantaneous communication and the participation in the meeting pursuant to this provision shall constitute presence in person of such meeting.

  5. The quorum shall be two (2) members at least one of whom is an independent director.
  6. The Committee shall in accordance with a procedure or process to be determined by the Board of Directors and at the expense of the Company:-

    1. Develop, maintain and review the criteria to be used in the recruitment process and annual assessment of directors.
    2. Annually review the required mix of skills and experience and other qualities, including core competencies which non-executive and executive directors should have.
    3. Assess on an annual basis, the effectiveness of the board as a whole and the contribution of each Board committees as well as each individual director and to ensure that the Board and its respective Board committees have the appropriate balance of expertise and ability.
    4. Be entitled to the services of a company secretary who must ensure that all appointments are properly made, that all necessary information is obtained from Directors, both for the Company’s own records and for the purposes of meeting statutory obligations as well as obligations arising from the Listing Requirements of Bursa Malaysia Securities Berhad or other regulatory requirements.
    5. Facilitate board induction and training programmes.
  7. In furtherance to their duties as members of the Nominating Committee of the Company, there should be an agreed procedure for the members, whether as a full Committee or in their individual capacity, to take independent professional advice at the Company’s expense, if necessary.
  8. The duties and responsibilities of the Committee are as follows,:-

    1. assessing and recommending to the Board of Directors, list of candidature of persons for selection as directors, appointment of directors to board committees and that women candidates are sought as part of the recruitment process.

      (The nomination and election process of board members should be disclosed in the annual report. Per the new Paragraph 15.08A of Main Market Listing Requirements as amended on 29/11/2012 and effective date of compliance on 1 June 2013, the listed issuer must provide, in its annual report, a statement about the activities of the nominating committee in the discharge of its duties for the financial year.)

      In making its recommendations, the Committee should assess the suitability of candidates and considerations be given to the competencies, commitment, contribution and performance as well as consider the candidates’:

      • skills, knowledge, expertise and experience;
      • character, integrity, professionalism;
      • competence and time to effectively discharge his role; and
      • in the case of candidates for the position of independent non-executive directors, the Committee should also evaluate the candidates’ ability and commitment to discharge such responsibilities/functions as expected from independent non-executive directors.

    2. To consider in making its recommendations, candidates for directorships proposed by the Chief Executive Officer and, within the bounds of practicality, by any other senior executive or any directors or shareholder.
    3. To annually assess the effectiveness of the Board of Directors as a whole, the committees of the Board and the contribution of each individual director taking into account, the required mix of skills and experience and other qualities including core competencies which non-executive directors should bring to the Board and thereafter, recommend its findings to the Board.
    4. To review of the succession plans of the Board.
    5. To review the training programmes for the Board.
    6. To facilitate board induction and training programmes.
    7. To act in line with the directions of the Board of Director.
    8. To consider and examine such other matters as the Committee considers appropriate.
    9. To review the term of office and performance of the AC and each of its members annually to determine whether their duties have been carried out in accordance with their term of reference.
  9. The Board has entrusted NC with the responsibility for carrying out the annual Board Effectiveness Evaluation.

    The Board’s effectiveness is assessed in the areas of composition, administration, accountability and responsibility, conduct and the performance of the Chairman, Chief Executive Officer and senior Management.

    The Directors’ Self and Peer Assessment is intended to evaluate the mix of skills, experience and other relevant qualities the Directors bring to the Board, and takes into account the individual director’s ability to exercise independent judgment at all times and to contribute the effective functioning of the Board. The Self and Peer Assessment process also examines the ability of each Board or Committee member to give material input at meetings and to demonstrate a high level of professionalism and integrity in the decision-making process.

    NC also reviews the term of office and performance of the Board Committee and each of its members annually to determine whether such Committee and members have carried out their duties in accordance with their terms of reference.

    The annual Board Effectiveness Evaluation exercise facilitates the assessment of the level of independence demonstrated by each independent directors in their exercise of judgement and ability to act in the best interest of the Company in decision-making, as well as clarify of thought and objectivity in problem solving during deliberations at Board meetings.