EXCEL FORCE MSC BERHAD Annual Report 2017

34 EXCEL FORCE MSC BERHAD (570777-X) ANNUAL REPORT 2017 INTRODUCTION The Board of Directors (“the Board”) of the Excel Force MSC Berhad (“the Company’) is pleased to present the Statement on Risk Management and Internal Control which outlines the nature and scope of risk management and internal control system of Excel Force MSC Berhad and its subsidiaries (“the Group”) for the financial year ended 31 December 2017 pursuant to Paragraph 15.26(b) of the Main Market Listing Requirement of Bursa Malaysia Security Berhad (“MMLR”), Malaysian Code on Corporate Governance (“MCCG”) and “Statement on Internal Control and Risk Management : Guidelines for Directors of Listed Issuers”. BOARD RESPONSIBILITY The Board affirms its overall responsibility for the Group to maintain adequate systems of internal controls and risk management to safeguard its investment, the interest of customers, regulators, employees, and the Group’s assets. The Board further recognises its responsibility in reviewing the adequacy and integrity of these systems. The Audit Committee is entrusted by the Board to ensure effectiveness of the Group’s internal control and risk management system. Due to the limitations that are inherent in any system of internal control, the system of internal controls can only provide reasonable and not absolute assurance against material misstatement or loss as it is designated to manage rather than eliminate the risk of failure to achieve the Group’s business objectives. RISK MANAGEMENT COMMITTEE OF THE MANAGEMENT (“RMCM”) Risk Management Committee of the Management is established at management level to assist the Audit Committee (“AC”) and the Board in implementing and ensuring efficient and effective risk management of the Company. The term of reference has been reviewed and received by AC in the quarterly Audit Committee meeting. The composition of RMCM is as follows: Chairman Chief Executive Officer Secretary Legal Executive Members • Chief Executive Officer • Executive Director • Chief Technology Officer • Head of Finance • Head of Sales & Marketing • Head of HR & Administration • Head of Customer Service • Head of Research & Development • Head of System Design • Head of Project Management RISK MANAGEMENT The Board confirms that there is an on-going process of identifying, assessing and responding to risks for achieving the objectives of the Group for the financial year under review. The process is in place for the financial year under review and up to the date of issuance of the Statement on Risk Management and Internal Control. The process of risk identification involves in reviewing and identifying the possible risk exposure which is arising from both internal and external environment changes and operation conditions. The risk measurement guidelines consist of financial and non-financial qualitative measure of risk consequences based on risk likelihood rating and risk impact rating. As part of the Risk Management process, a Registry of Risk and the Risk Management Handbook were adopted. The Registry of Risk is maintained to identify principal business risk and updated for on-going changes in the risk profile. The Risk Management Handbook summarises risk management methodology, approaches and processes, roles and responsibilities, and various risk management concept. The responsibility of respective risk owners is to identify and ensure that adequate control systems are implemented to minimise and control the risks faced by the Group. Statement On Risk Management And Internal Control