BOARD AUDIT COMMITTEE REPORT Vacancy In the event of any vacancy in the BAC resulting in the non-compliance with Paragraph 15.09(1) of the MMLR, the vacancy must be filled within three (3) months. SUMMARY OF ACTIVITIES BAC Meetings and tentative agendas are scheduled in advance of any new financial year to facilitate BAC members to plan ahead and fit the year’s meetings into their schedules. The BAC meets every quarter, with additional meetings held as and when required, to review and deliberate the quarterly and annual financial statements, the Enterprise Risk Management report, GIA reports, related party transaction matters and other relevant matters within the BAC’s terms of reference. During the financial year under review, 5 BAC meetings were held. Minutes of BAC meetings which include records of the decisions and resolutions of the meetings are properly maintained by the Secretary of the BAC. The President/CEO was also invited to attend BAC meetings to facilitate the discussion as well as to provide explanation on audit issues, risk management and financial matters, and other matters within the terms of reference of the BAC. The BAC meetings were also attended by Senior General Manager, Group Internal Audit of PETRONAS and General Manager, GIA of MISC to observe the proceedings of the meetings and provide clarification on any relevant Internal Audit reports tabled to the BAC together with relevant Management Committee members. The External Auditors were also invited to present their Audit Plan and Audit Results, Memorandum of Suggestion and other relevant matters. During the financial year ended 31 December 2015, the BAC carried out the following activities in discharging its functions and duties:- A) Risk Management • The RMC met at least once in every quarter and primarily responsible for driving the Risk Management Framework and acted as a central platform for risk oversight within the Group. • Reviewed the adequacy and effectiveness of Risk Management Framework and the relevant on-going activities for identifying, evaluating, monitoring and managing risks. • Received and reviewed reports on key strategic and operational risk issues arising from quarterly Risk Management Committee (“RMC”) meeting, including review of the mitigation plans to address the said risks. • Reviewed and endorsed the Group’s Financial Year 2015 Enterprise Risk Management Risk Register emanating from the Annual Planning Cycle and ensured that appropriate systems and processes are in place to effectively monitor and manage these risks. • Reviewed the emerging risks affecting the Company’s business as a result of the depressed oil and gas market. • Reviewed and recommended the PETRONAS Resiliency Model for adoption at MISC Group. • Reviewed MISC’s Business Continuity Plan (“BCP’) and the status of implementation of the BCPs within the Group. • Reviewed the Statement on Risk Management and Internal Control in line with Paragraph 15.23 of the MMLR. REDISCOVER I REBUILD I SUSTAIN 124
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