STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL INTRODUCTION The Board is committed to maintaining a sound system of risk management and internal control in the Group to safeguard shareholders’ investments and the Group’s assets. The Board is pleased to provide the Statement on Risk Management and Internal Control which outlines the nature and scope of risk management and internal control of the Group for the financial year ended 31 December 2022 (“FY2022”) under review, in accordance with paragraph 15.26(b) of Main Market Listing Requirements of Bursa Malaysia Securities Berhad. For the purpose of this Statement, the Group comprises the holding company and its subsidiaries. RESPONSIBILITIES OF THE BOARD The Board acknowledges the importance of maintaining an effective and sound system of risk management and internal control, covering all its financial and operating activities, to safeguard shareholders’ investments and the Group’s assets. Notwithstanding this, due to the limitations that are inherent in any system of internal control, the Group’s internal control system is designed to manage, rather than eliminate, the risk of failure to achieve business objectives, and can only provide reasonable but not absolute assurance against material misstatement or loss. Accordingly, the Board affirms its responsibility for the Group’s system of risk management and internal control and its commitment to review its effectiveness, adequacy and integrity to ensure implementation of an appropriate system to effectively and continuously identify, evaluate and manage principal risks of the Group and to mitigate the effects of the principal risks on achieving the Group’s business objectives. The Group’s system of internal control covers risk management and financial, operational and compliance controls. The Board continually reviews the system of internal control to ensure that it provides a reasonable but not absolute assurance against material misstatement of financial information and records, or against financial losses or fraud. The Board has established an ongoing process for identifying, evaluating and managing the significant risks faced by the Group. The Management assists the Board in the implementation of the Board’s policies and procedures on risks and internal controls by identifying and assessing the risks faced, and in the design, operation and monitoring of suitable internal controls to mitigate and control these risks. The Board has received assurance from the Chief Executive Officer and the Chief Financial Officer that the Group’s risk management and internal control system is operating adequately and effectively in all material aspects. The Board has taken the necessary steps to ensure that appropriate systems are in place for the assets of the Group to be adequately safeguarded through the prevention and detection of fraud and other irregularities and material misstatements. The Board is of the view that the risk management and internal control system in place for the year under review and up to the date of issuance of the financial statements is adequate and effective. RISK MANAGEMENT FRAMEWORK The Board has overall accountability for ensuring that risks are effectively managed across the Group, and the Board has delegated and empowered the Audit and Risk Management Committee (“ARMC”) to oversee internal control and risk management of the Group. The review mechanism applied by the ARMC in deriving its comfort on the state of the internal control and risk management of the Group includes:- (i) Assessing the adequacy and effectiveness of internal controls based on the internal audit findings presented by the Internal Auditors. These reviews are done quarterly where the Internal Auditors present their internal audit report to the ARMC; (ii) Understanding the Group’s performance and effectiveness of management in managing the Group’s operations when reviewing the Group’s quarterly financial performance and results and the ongoing development; and (iii) Obtaining feedback from External Auditors on risk and control issues noted by them during their statutory audit concerning the integrity of the accounting system and results generated by the system thereof annually. Annual Report 2022 58
RkJQdWJsaXNoZXIy NDgzMzc=