The Committee considered the independence and appraisal of the External Auditors. This review took into account the following factors:- (i) Auditors’ Effectiveness The Committee met with management, to hear their views on the effectiveness of the External Auditors. The criteria for assessing the effectiveness of the audit included the robustness of the audit, the quality of the audit delivery and the quality of the people and service. The Committee concluded that the performance of the External Auditors remained effective. (ii) Independence and Objectivity The Committee reviews the work undertaken by the External Auditors and each year assesses its independence, objective and performance. In doing so, it takes into account relevant professional and regulatory requirements and the relationship with the auditor as a whole, including the provision of any non-audit services. The Committee monitors the auditor’s compliance with relevant regulatory, ethical and professional guidance on the rotation of partners, as well as assessing annually its qualifications, expertise, resources and the effectiveness of the audit process, including presentation from the External Auditor on its own internal quality procedures. The audit engagement partner is required to rotate at least every five (5) years as per the External Auditors policy, which is in accordance with the ByLaws (on professional ethics, conduct and practice) of the Malaysian Institute of Accountants (MIA). The Committee always consider the audit partner’s independence in relation to the audit and was assured by the External Auditors that they have complied with professional requirements in relation to their independence. The Committee concluded that it is satisfied with the performance of the External Auditors that they are objective and independent in relation to the audit. (iii) Non-audit work carried out by the External Auditors To help protect auditor’s objectivity and independence, the provision of any non-audit services provided by the External Auditors requires prior monitoring by the management. Certain types of non-audit are of sufficiently low risk and does not require prior approval of the Committee, such as “audit-related services” including the review of interim financial information. The prohibited services are those that have potential to conflict directly with the auditors’ role, such as the preparation of the Company’s financial statements. The total of audit fees and non-audit fees paid to the External Auditors during the FY2024 is set out in the Note 33 of the audited financial statements. The External Auditors also provided in its engagement letter on the specific safeguards put in place for each piece of non-audit work confirming that it was satisfied that neither the extent of the non-audit services provided nor the size of the fees charges had any impact on its independence as statutory auditors. The Committee is satisfied that the quantum of the non-audit relative to the audit fees (being 30% of the total audit fees on a group basis payable to the External Auditors and affiliates) and the Committee concluded that the auditors’ independence form the Group was not compromised. (iv) External Audit fees The Committee was satisfied that the level of audit fees payable in respect of the external audit services provided for FY2024: RM730,118 (FY2023: RM713,858) was appropriate. The existing authority for the Directors (including the Committee) to determine the current remuneration of the External Auditors is derived from the shareholders’ approval granted at the Company’s Annual General Meeting (“AGM”) held on 30 August 2023. G RECOMMENDATION FOR APPOINTMENT Matrix adheres to a 10-year term for external auditors to promote independence, transparency and accountability in corporate reporting. Messrs. Crowe Malaysia PLT has completed its 10th year as the external auditors for the Company and therefore, in accordance with the Terms of Reference of the Audit Committee, is not seeking reappointment as the External Auditors of the Company. Hence, they shall cease their office as External Auditors of the Company upon the conclusion of the forthcoming Annual General Meeting of the Company. The Audit Committee has recommended the appointment of Messrs. Ernst & Young PLT as the new auditor to replace outgoing auditor subject to the approval of the shareholders at the forthcoming Annual General Meeting of the Company. AUDIT COMMITTEE REPORT OUR GOVERNANCE MATRIX CONCEPTS HOLDINGS BERHAD 124
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