Risk area Control measures taken to mitigate the risks Environmental, social and governance (“ESG”) risks • The Group faces a variety of ESGrelated issues and some of them are potential to be material and might cause financial or reputational damage. • Implement the guidance under Environment Management System Certification – ISO 14000:2000 in the Group’s pre-cast operations to minimise the environmental impact. • Continuous monitoring and producing quarterly reports of environment impact of quarry operations. • Conduct social impact assessment of property development projects in compliance with the applicable rules and regulations. • Appointment of consultants to advise on material ESG topics and development of materiality matrix. • Implement standard policies and procedures on key operational processes. • Implement Anti-Bribery and Anti-Corruption Policy (“ABAC Policy”) and internal guidelines thereunder to ensure that the Group’s business is conducted in an ethical manner with integrity and honesty. • Implement the Code which sets out the standards which the directors, officers and employees (“Personnel”) of the Group are expected to comply in relation to the affairs of the Group’s businesses when dealing with each other, shareholders and the broader community. This Code focuses on areas of ethical risk, provide guidance to Personnel to help them to recognise and deal with ethical issues, provides mechanisms to report unethical conduct, and helps to foster a culture of honesty, integrity and accountability. • Implement Whistle Blowing Policy which provides means by which an individual can report internally through established channels, concerns about unethical behaviour, malpractices, illegal acts or failure to comply with regulatory requirements that is taking place/has taken place/may take place in the future, without fear of reprisal or victimisation. • Implement Conflict of Interest (“COI”) Policy and maintain a robust framework consisting of well-defined processes and procedures to ensure that the Group’s interests are safeguarded in a situation involving COI. • Engage an independent internal audit function to provide reasonable assurance on the effectiveness of the system of internal control within the Group. The risk management process is also audited to provide assurance on the management of risks. Credit and liquidity risks • The Group faces the threat of delays in payment by customers for work done which will eventually affect the Group’s cash flow, and heighten the risks of debts becoming unrecoverable. • Background check of prospective customers prior to accepting any engagement from such parties. • Close monitoring of collections by the finance department with weekly updates to the senior management as to collections received and incidences of delay. • Timely follow up with the customers on overdue payments and retention sums. • In situations where customers are unable to adhere to the agreed credit terms, reasons for the delay will be considered. If there are sufficient commercial justifications, negotiated settlements which include extensions of time for payments or accepting tangible assets such as properties in lieu of cash payment will be considered when the chances of cash recovery is remote. • Avoid over concentration of sales and credit exposure to any customer to prevent over-dependence on any customer. • Actively monitor the Group’s banking facilities to ensure the facilities are sufficient to meet the Group’s working capital and capital expenditure requirement, and negotiate with bankers for credit facilities which enable greater flexibility in the Group’s management of financial resources. • Issuance of Sukuk, where necessary, to meet the Group’s funding needs. • Monetisation of assets of slow return, where necessary, in situation where there is good quick turnaround alternative business opportunity. STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL 071 ANNUAL REPORT 2024
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