Al-`Aqar Healthcare REIT Annual Report 2020

Governance Structure 87 SUMMARY OF WORK CARRIED OUT DURING FINANCIAL YEAR The BARC held four meetings during FY2020. The meeting dates were predetermined in advance in order to ensure availability of each member. Meeting papers were circulated to all the BARC members prior to the meetings by way of electronic means and hard copy. The BARC carried out the following work during the financial year ended 31 December 2020 in the discharge of its functions and duties: Overseeing Financial Reporting (a) Reviewed the audited financial statements of Al-`Aqar for the financial year ended 31 December 2019 (“FY2019”), which were prepared in accordance with the Trust Deed of Al-`Aqar, Malaysian Financial Reporting Standards, International Financial Reporting Standards and the applicable Securities Commission Malaysia (“SC”) rules and guidelines, prior to recommending the same to the Board for approval. At the meeting held on 29 January 2020, the External Auditors presented to the BARC the results of the FY2019 audit conducted on Al-`Aqar, where significant audit matters such as valuation of investment properties, revenue recognition and fraud considerations, were discussed. (b) Reviewed at every quarterly meeting held in FY2020, the quarterly unaudited financial results for public release to ensure adherence to legal and regulatory reporting requirements before recommending the same to the Board for approval. The first, second, third and fourth quarters of the quarterly results for the financial year ended 31 December 2020 were reviewed at the BARC meetings held on 13 May 2020, 19 August 2020, 18 November 2020 and 26 January 2021 respectively. (c) Reviewed and discussed with Management the quarterly management accounts, taking into consideration that the necessary processes and controls are in place in the preparation of the financial reports. (d) Reviewed, at each quarterly meeting, the income distributions of Al-`Aqar which were made in accordance with the distribution policy of Al-`Aqar, in order to ensure the adequacy of the realised income for each distribution prior to recommending the proposal to the Board. (e) Kept abreast on the application of the new, revised and amendments to accounting standards such as the Amendments to MFRS3 – Definition of a Business, Amendments to MFRS 101 and MFRS 108 – Definition of Material and Revised Conceptual Framework for Financial Reporting. The External Auditors ensured that the BARC members were briefed on the key requirements and potential impact of these new, revised and amendments. External Audit: (a) Evaluated the suitability and independence of the External Auditors at the meeting held on 13 May 2020 against evaluation criteria established. Following a satisfactory assessment, the BARC recommended to the Board their appointment as Auditors of Al-`Aqar in respect of FY2020 for onward recommendation to the Trustee of Al-`Aqar. The evaluation criteria included, among others, the adequacy and experience of the firm, its resources, and the experience of the professional staff assigned to the audit of Al-`Aqar. (b) Noted the External Auditors’ confirmation of their firm’s independence in accordance with the terms of all relevant professional and regulatory requirements. (c) Ensured that Al-`Aqar’s appointed External Auditors were duly registered with the Audit Oversight Board (“AOB”) of the SC; based on the verification carried out by the Compliance Officer on the AOB’s Register of Auditors as at 31 October 2020 available on the SC’s website. Board Audit and Risk Committee Report