AUDIT AND RISK MANAGEMENT COMMITTEE REPORT SUMMARY OF ACTIVITIES OF THE AUDIT AND RISK MANAGEMENT COMMITTEE During the financial year, the ARMC met five times. In line with the terms of reference of the ARMC, the following activities were carried out by the ARMC during FY2022 in discharging its functions:- (1) External Audit (a) Met with the external auditors, Crowe Malaysia PLT (“Crowe”) three times during FY2022 on 25 February 2022, 30 March 2022 and 29 November 2022 respectively on matters relating to the audit and financial statements without the presence of Management and Executive Directors; (b) Reviewed and discussed with Crowe on their scope of work, engagement team, audit timeline, areas of audit emphasis, key audit matters, accounting standards updates that affected financial reporting, the responsibilities of Directors and Management, and the FY2022 audit planning memorandum; (c) Reviewed and discussed with Crowe the results of their audit, their comments and conclusions on the significant audit findings, the audit report, management letter and their evaluation of the internal controls; (d) Sought clarification from the Management on significant financial reporting issues, judgments made by the Management and matters highlighted by Crowe. The ARMC was satisfied with the clarification from the Management and the actions taken by the Management to address the matters highlighted; (e) Established External Auditor Policy on, amongst others, the procedures for the selection, nomination, appointment and re-appointment of external auditors, assessment of the external auditors and procedures for the provision of non-audit services by the external auditors; (f) Reviewed the audit fees proposed by Crowe and recommended the fees to the Board of Directors for approval; and (g) Assessed the suitability, objectivity and independence of Crowe. In its assessment, the ARMC considered, amongst others, the information presented in Crowe’s annual transparency report, competency and adequacy of resource, the professional staff assigned to the audit and the level of non-audit services to be rendered by Crowe. Written assurance was received from Crowe confirming their independence in accordance with the By-Laws (on Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants. Being satisfied with Crowe’s technical competency, resources and audit independence, the ARMC recommended the appointment of Crowe as external auditors for FY2022. (2) Financial Reporting (a) Reviewed the quarterly unaudited financial results, audited financial statements and Annual Report before recommending for the Board’s approval, focusing particularly on:- (i) changes in or implementation of major accounting policy changes; (ii) significant matters highlighted including financial reporting issues, significant judgments made by Management, significant and unusual events or transactions, and how these matters are addressed; (iii) compliance with accounting standards, regulatory and other legal requirements; (iv) the going concern assumption; and (v) significant adjustment arising from the audit. The ARMC obtained the advice of the Company Secretary and external auditors on compliance with the MMLR of Bursa Securities, the applicable approved Financial Reporting Standards issued by the Malaysian Accounting Standards Board, and other legal requirements. (b) Invited the Finance Director to all ARMC meetings to facilitate direct communication as well as to provide clarification on the financial results of the Group, the changes in or implementation of major accounting policy changes. Kimlun Corporation Berhad | Registration No. 200901023978 (867077-X) 55
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