Dagang NeXchange Berhad Annual Report 2019

CORPORATE ACCOUNTABILITY annual report 2019 67 6. UPHOLD INTEGRITY IN FINANCIAL REPORTING 6.1 Compliance with Applicable Financial Reporting Standards The financial statements of the Group were prepared under the historical cost convention and modified to include other bases of valuation as disclosed therein under significant accounting policies, and in compliance with the Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act 2016. The Board is responsible for the quality and completeness of publicly disclosed financial reports. This ensures that shareholders are provided with a balanced and meaningful evaluation of the Company’s financial performance, its position and its future prospects, through the issuance of its annual audited financial statements and quarterly financial reports and corporate announcements on significant developments affecting the Company in accordance with the MMLR of Bursa Securities. The Board is committed to continuously provide and present a clear, balanced and comprehensive assessment of the Group’s financial performance and prospects. In order to fulfill the commitments to stakeholders, the Company ensures that the recording and reporting of financial and business information is as fair and accurate as determinable. 6.2 Statement of Directors’ Responsibility The Directors are responsible in ensuring that the financial statements of the Company and its subsidiaries are properly drawn up in accordance with the requirement of the approved financial reporting standards in Malaysia, the MMLR of Bursa Securities and the provisions of the Companies Act, 2016 so as to give a true and fair view of the state of affairs of the Company and its subsidiaries for the financial year then ended. The Directors also have a general responsibility to take steps to safeguard the assets of the Group and to prevent and detect fraud and other irregularities. The Statement of Directors’ Responsibility in respect of the preparation of the annual audited financial statements of the Group pursuant to Section 251 of the Companies Act, 2016 is set out on pages 98 to 103 of this Annual Report. 6.3 Relationship with Auditors and Independence of External Auditors Through the Audit Committee, the Board maintains a transparent and professional relationship with the Company’s auditors, both external and internal. The Audit Committee met the external auditors twice during the year under review without the presence of the Executive Directors and the Management to allow the Audit Committee and the external auditors to exchange independent views on matters which require the Audit Committee’s attention. The external auditors, Crowe Malaysia PLT, provide an independent opinion, based on audit performed on the financial statements of the Group and report the same to the shareholders of the Company in accordance with Section 266 of the Companies Act 2016. The external auditors also attend each AGM in order to assist in giving clarifications to shareholders on the audited financial statements. PRINCIPLE B: EFFECTIVE AUDIT AND RISK MANAGEMENT 1. RISK MANAGEMENT AND INTERNAL CONTROL FRAMEWORK The Board is assisted by the Audit Committee in reviewing the adequacy of the risk management and internal control system of DNeX Group. The Board acknowledges its responsibility for maintaining a sound system of internal control which provides reasonable assurance in ensuring the effectiveness and efficiency of the Group’s operations and to safeguard shareholders’ investment and its assets and interests in compliance with the relevant law and regulations as well as the Group’s internal financial administration procedures and guidelines. The Statement on Risk Management and Internal Control furnished on pages 70 to 73 of this Annual Report provides an overview on the state of internal controls and level of risks and the effectiveness of risks mitigation plans within the DNeX Group. Further to this, the external auditors conduct annual statutory audit on the financial statements. Areas for improvement identified during the course of statutory audit by the external auditors are brought to the attention of the Board accordingly.