Frontken Berhad Annual Report 2019

29 Frontken Corporation Berhad (651020-T) ANNUAL REPORT 2019 Corporate Governance Overview Statement (cont’d) PRINCIPLE B – EFFECTiVE AUDIT AND RISK MANAGEMENT I. Audit Committee To assist in the discharge of its duties on financial reporting, the Board has established an Audit Committee, comprising three (3) Non-Executive Directors, with Dato’ Haji Johar Bin Murat @ Murad, an Independent Non-Executive Director, as the Committee Chairman. The Committee’s composition, including its roles and responsibilities as well as a summary of its activities carried out during the financial year under review, are set out in the Audit Committee Report on pages 37 to 39 of this Annual Report. One of the key responsibilities of the Audit Committee is to ensure that the financial statements of the Group and Company comply with Malaysian Financial Reporting Standards, International Financial Reporting Standards and provisions of the Companies Act 2016. Such financial statements comprise the quarterly financial report announced to Bursa Securities and the annual statutory financial statements. The Board understands its role in upholding the integrity of financial reporting by the Company. Accordingly, the Audit Committee, which assists the Board in this aspect, has adopted a policy for the types of non-audit services permitted to be provided by the external auditors and/or their affiliates, including the need for obtaining the Audit Committee’s approval for such services. To enhance transparency and governance, the Audit Committee has also formalised a policy that requires a former key audit partner to observe a cooling-off period of at least two (2) years if this person is sought to be appointed as an Audit Committee member. II. Risk Management And Internal Control Framework The Board has overall responsibility for maintaining a sound system of risk management and internal control of the Group that provides reasonable assurance on efficient business operations, compliance with laws and regulations as well as internal procedures and guidelines to achieve corporate objectives. The Audit Committee assists the Board in reviewing the adequacy and operating effectiveness of the system of risk management and internal control in the Group. The Audit Committee does this by deploying an independent outsourced internal audit function as well as an in-house internal audit function that conduct internal audit, with findings presented to the Audit Committee, including the remedial measures and action plans agreed by Management to address the matters so highlighted. For more details of Internal Audit, both for the outsourced and in-house functions, refer to the Statement on Risk Management and Internal Control which is included in the Company’s 2019 Annual Report as well as the Corporate Governance Report that is made available on the Company’s website at www.frontken.com . The Audit Committee is responsible for overseeing the risk management framework and policies while Management of the respective business units and subsidiaries is tasked to manage business risks, including developing, implementing and monitoring mitigating measures to manage such risks to acceptable levels. Details of the Group’s Risk Management framework, activities carried out for the financial year under review and reporting processes are set out in the Statement on Risk Management and Internal Control included in this Annual Report. PRINCIPLE C – INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP WITH STAKEHOLDERS I. Communication With Stakeholders The Board recognises the importance of being transparent and accountable to the Company’s shareholders and other stakeholders and acknowledges that continuous communication between the Company and its stakeholders facilitates mutual understanding of each other’s objectives and expectations. As such, the Board ensures the supply of clear, comprehensive and timely information to stakeholders by way of various disclosures and announcements, including quarterly and annual financial results which provide investors with up-to-date financial information of the Group. All these announcements and other information about the Company, which are disseminated according to the Company’s Corporate Disclosure Policy, are available on the Company’s website at www.frontken.com where shareholders, investors and the general public may access. In addition, the Directors also ensure that engagement with shareholders occurs at least once a year during the AGM to better understand their needs and obtain their feedback.