AL-SALAM REIT ANNUAL REPORT 2018

AL-SALĀM REIT ANNUAL REPORT 2018 80 5. Committees In carrying its functions, the Board is supported by the Audit Committee, Executive Committee and Nomination and Remuneration Committee, all of which operatewithin deined terms of reference. These committees provide the appropriate checks and balances. 5.1 Audit Committee (AC) A. Membership (i) The members of the AC shall be appointed by the Board and shall consist of not less than 3 members. (ii) All members must be Non-Executive Directors. (iii) All members should be inancially literate and at least one member must be a member of the Malaysian Institute of Accountants (MIA) or have the relevant qualiications and experience as speciied in the Bursa Malaysia Securities Main Market Listing Requirements. (iv) The Chairman of the AC, elected fromamongst the Audit Committeemembers shall be an Independent Director. (v) No alternate Director of the Board shall be appointed as a member of the AC. B. Purposes (i) To ensure transparency, integrity and accountability in the Fund’s activities so as to safeguard the rights and interests of the Unitholders; (ii) To provide assistance to the Board in fulilling its iduciary responsibilities relating to corporate accounting and reporting practices; (iii) To improve the Fund’s business eiciency, the quality of the accounting and audit function and strengthen public conidence in the Fund’s reported inancial results; and (iv) To maintain open lines of communication between the Board and the External Auditors. C. Duties and Responsibilities The objective of the AC is to assist the Board in fulilling its iduciary responsibilities relating to corporate governance, internal controls, inancial and accounting records and policies as well as inancial reporting practices of Al-Salām REIT. The AC’s responsibilities include: (i) To review the quarterly and year-end inancial statements of the Fund prior to the approval by the Board; (ii) To provide an independent assessment of the adequacy and efectiveness of risk management functions; (iii) To review the internal audit programme, the results of the internal audit process or investigation undertaken and ensure that appropriate action is taken on the recommendations of the internal audit function; (iv) To review with external auditors the audit plan, scope of audit and audit reports; and (v) To review any related party transactions and conlict of interest situation that may arise. D. Meetings Aminimumof 4meetings shall be planned during the inancial year and the quorumfor themeeting shall be 2members. In the absence of the Chairman, the members present shall elect a chairman for the meeting from amongst the members present. Reports of the AC meeting shall be tabled by the AC’S Chairman at the Board of Directors meeting. 5.2 Executive Committee (EC) The EC meets on a scheduled basis at least 4 times a year. The minutes of the EC meetings are tabled to the Board for notiication and further action by the Board, where necessary. This EC oversees the activities of the Manager and Al-Salām REIT on behalf of the Board which includes: (a) Making recommendations to the Board on all acquisitions, investments and disposals; (b) Making recommendations to the Board on any inancing ofers, capital management proposals and additional banking facilities; (c) Reporting and recommending to the Board any corporate exercise, including the issuance of new Al-Salām REIT units; (d) Making recommendations to the Board on inancial budgets; and (e) Forwarding summary reports on activities undertaken by the Manager and minutes of EC meetings to Board members, where applicable.