Frontken Corporation Berhad 200401012517 (651020-T) • A N N U A L R E P O R T 2 0 2 1 54 INTERNAL CONTROL SYSTEM – THE KEY FEATURES (CONT’D) Besides those internal controls implemented by Management to mitigate the risks as mentioned above, the Group’s internal control system also covers the following salient elements: (cont’d) • the Audit Committee, which is entrusted by the Board to oversee, amongst others, the Company’s financial reporting process, in particular the quarterly and annual announcements of the Group’s financial performance, meets at least quarterly to review the announcements, seeks clarification and explanations from Management before recommending the announcements to the Board for approval; • internal policies and procedures on key business processes are formalised in writing for application by personnel across the Group. These policies and procedures provide the necessary guidance to personnel on complying with internal control requirements and applicable laws and regulations; • structured whistle-blower policies and procedures are formalised in writing to enable employees of the Group to raise genuine concerns about suspected improprieties on matters of financial reporting, non-compliance with laws and regulations, malpractices or unethical business conduct within the Group at the earliest opportunity and in an appropriate way without fear of reprisal. Ng Chee Whye, the Independent Non-Executive Director, with his contact details uploaded to the website of the Company is the person to contact on such concerns; and • where issues arise that affect the reliability and integrity of financial information of any business unit, special audits are commissioned by the Audit Committee or Senior Management, as the case may be, to assist the Board in fulfilling its oversight responsibilities. INTERNAL AUDIT FUNCTION – ITS COMPOSITION AND SCOPE OF COVERAGE The Group has two (2) groups of internal auditors, i.e. one covering the operations of the Group (save for Taiwan operations), and the other covering solely the Taiwan operations. The internal audit function of the Group (save for Taiwan operations) is outsourced to an independent professional firm, namely Sterling Business Alignment Sdn Bhd, (“Sterling”). Sterling was engaged to replace BDO Governance Advisory Sdn Bhd at the end of the previous year. The internal audit function for the Taiwan operations is an in-house function, i.e. the internal audit personnel are employees of the subsidiary in Taiwan, namely Ares Green Technology Corporation (“AGTC”). The appointment of the outsourced internal audit service provider followed an assessment of its suitability and capability by the Audit Committee of the Company whilst the performance of the in-house internal audit function is under the oversight of AGTC’s Board. Outsourced internal audit coverage – Group (save for Taiwan operations) The outsourced internal audit team is helmed by an average of four (4) professionals from the firm, a corporate member of the Institute of Internal Auditor Malaysia. The team is led by So Hsien Ying, a Certified Internal Control Professional, was to conduct an assessment of the Group’s system of internal control during the financial year under review, focusing on selected significant business units and reporting its observations, including Management’s response and action plans thereto, directly to the Audit Committee. However, due to cross borders travel restrictions, the internal audit was pushed back by one quarter and the audit plan was changed by swapping the auditee entities. The internal audit function also conducted a follow-up on the status of implementation of action plans by Management on the recommendations highlighted, as deemed relevant. The Audit Committee took note of the recommended improvement actions and questions were posed to Management on the timeliness of measures to address the issues as reported. STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL (CONT’D)
RkJQdWJsaXNoZXIy NDgzMzc=