Excel Force MSC Berhad Annual Report 2015

E X C E L F O R C E M S C B E R H A D • A N N U A L R E P O R T 2 0 1 5 27 g) To review the quarterly results and year end financial statements, prior to the approval by the Board, focusing particularly on: (i) changes in or implementation of major accounting policy changes; (ii) significant and unusual events; and (iii) compliance with accounting standards and other legal requirements. h) To reviewany related party transaction and conflict of interest situation that may arise within theGroup including any transaction, procedure or course of conduct that raises questions of management integrity; i) To review whether there is reason (supported by grounds) to believe that the Company’s external auditor is not suitable for re-appointment; j) To verify the allocation of options pursuant to a share scheme for employees at the end of each financial year, if any; and k) To review the adequancy of the Risk Management framework, policy, process and procedures undertaken and whether or not appropriate Risk Management Control actions are taken on to safeguard the interest of the respective stakeholders. 5. Summary of Audit Committee Activities During the financial year, the Audit Committee has carried out its duties as set out in the terms of reference detailed below: a) Reviewed the scope of work of the external auditors and audit plans for the year; b) Reviewed with the external auditors the results of the audit, the audit report and the management letter, including management’s response; c) Reviewed the internal auditors’ scope of work; d) Checked with the internal auditors on any findings which require the Committee’s attention; e) Reviewed the internal control policy and internal control system; f) Reviewed the quarterly unaudited financial results announcements before recommending them for the Board’s approval; and g) Reviewed the annual financial statements before recommending for approval by the Board. INTERNAL AUDIT FUNCTIONS The Company has outsourced its internal audit division to an independent professional consulting firm to assist the Audit Committee in discharging their responsibilities and duties. The role of the internal audit functions is to undertake independent regular and systematic reviews of the system of internal controls so as to provide reasonable assurance that such system continue to operate satisfactory and effectively. The internal audits cover the review of the adequacy of risk management, operational controls, and compliance with established procedures, guidelines and statutory requirements. The details of internal audit functions, are noted in the Statement on Risk Management and Internal Control in this Annual Report. During the financial year under review, the internal auditors reviewed and audited the following areas :- (a) Internal control environment of Project Management; (b) Internal control environment of Quality Assurance; (c) Internal control environment of Finance and Account, Human Resources Management and Administration; (d) Internal control environment of Risk Management framework. The fee (inclusive of service tax/goods and services tax) paid to the professional firm in respect of internal audit function for the financial year ended 31 December 2015 was RM30,072. AUDIT COMMITTEE REPORT (cont’d)