B) Internal Audit • Reviewed and approved GIA long term audit plan and Annual Internal Audit Plan (“AIAP”) as guided by the approved Enhanced Risk Based Internal Audit (“RBIA”) Framework of MISC in order to ensure adequacy of resources, competencies and coverage on auditable entities. RBIA refers to the approved risk register that identify areas to be audited and more focus were given to areas with higher risk exposure. The areas of audit engagements covered during Financial Year Ended 31 December 2015 as follows:- ➢ Improvement in the Processes and Effective Cost Management, i.e., Vendor Management, Fixed Asset Management, Staff Expenses Claim; ➢ Safeguarding MISC’s Investment i.e. Project Risk Assessment, Contract Management, audit on joint venture companies within MISC Group; and ➢ Assist BAC in Governance Oversight Role i.e. Management of Directors’ Conflict of Interest and Quarterly and Annual Recurrent Related Party Transactions • Reviewed internal audit reports issued by GIA based on the approved AIAP and ensure that appropriate agreed correction action is taken by the Management on the gaps in controls or procedures as identified by GIA. • Reviewed inputs and management action plans provided by Management Committee (“MC”) on the deliberated audit reports. • Reviewed the adequacy and effectiveness of agreed corrective actions taken by management on all significant and secondary issues raised by in its audit reports. • Reviewed the minutes of meeting of the BAC of subsidiaries for an overview of the risk management and internal control systems of the subsidiary companies. • Requested the Company to conduct special audit into activities or matters arising from whistle blowing report or within the terms of reference of the BAC. • Reviewed the adequacy of resources and competencies of staff within GIA to execute the audit plan. • Conducted half-yearly and yearly assessment on the adequacy of GIA’s functions and resources, scope of work, service orientation, and its Annual Plan and Strategy. • Prior to BAC meetings, the Chairman held private meetings and discussions with Head and senior staff of GIA on audit reports and any Internal Audit related matters. C) External Audit • Reviewed and approved the External Auditors’ terms of engagement, audit plan, nature and scope for the financial year. • Reviewed the results and issues arising from External Auditors’ audit for the financial year and the resolution of issues highlighted in their report to the BAC and Management’s response. • BAC had 2 private meetings with the External Auditors without the presence of Management in financial year ended 31 December 2015 (i.e., on 4 February 2015 and 2 November 2015) to ensure that there were no restrictions in the scope of their audit and to discuss any matters that they may wish to present. • The BAC recommended the External Auditors’ re-appointment to the Board, including the fees payable. MISC BERHAD Annual Report 2015 125
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