THE BOARD AUDIT AND RISK COMMITTEE REPORT Compliance (a) Monitored and reviewed the status and outcomes of the Quarterly Compliance Report which seeks to identify gaps in compliance with regard to applicable laws, regulations, codes, standards, policies and procedures and discussed the adequacy of measures to address such gaps or noncompliance. (b) Deliberated on the results of compliance cases and directed Management to implement and/or enhance controls to prevent recurrence, including conducting education programmes to increase awareness. (c) Received updates on the directorships and shareholdings held by the Directors of the Company and persons connected with them in accordance with Section 221 of the Companies Act, 2016 on a annual basis. These disclosures enabled an assessment of the potential or actual conflicts of interest which may arise in relation to Related Party Transaction (“RPT”) or Recurrent Related Party Transaction (“RRPT”). (d) Monitored the status of internal misconduct cases reported to Board and BARC on a quarterly basis, including ongoing investigations, in accordance with the Code of Conduct and Business Ethics (“CoBE”). (e) Ensured that the Declaration of Directors’ Interests in Securities and disclosures of conflict of interest situation(s) in all Board level meetings, are documented and minuted accordingly in the minutes of meeting. The Committee took note that there was no management conflict of interest situations for operational matters (including any transaction, procedure or course of conduct) as reported by the Chief Executive Officer. Review of Related Party Transactions (“RPT”) and Recurrent RPT of a Revenue or Trading Nature (“RRPT”) & Conflict of Interest Situations (a) Reviewed related party transactions entered into by the REIT and ensured that the transactions undertaken were in the best interest of the REIT/ unitholders, fair, reasonable and on normal commercial terms, and not detrimental to the interest of the minority shareholders, and recommended the same for approval of the Board. (b) Reviewed the annual Shareholders’ Mandate in relation to recurrent related party transactions of a revenue or trading nature for Shareholders’ approval to undertake transactions that are recurrent, of a revenue or trading nature and which are necessary for the day-to-day operations of the REIT with related parties (“RRPTs”). (c) Ensured that the review procedures were sufficient to ensure that the RRPTs were not more favourable to the related parties than those generally available to the public and were not to the detriment of the minority shareholders and that the REIT Manager had in place adequate procedures and processes to monitor, track and identify RRPTs in a timely and orderly manner, and such procedures and processes were reviewed on a yearly basis or whenever the need arose. (d) Reviewed RRPT on a quarterly basis. The Management had given assurance to the BARC that related party transactions and mandate for RRPT were in compliance with the Listing Requirements and policies and procedures. Other Activities Reviewed and recommended to the Board, for inclusion in the Annual Report: • The BARC Report • Corporate Governance Overview Statement • Corporate Governance Report • Statement on Risk Management and Internal Control SUMMARY OF WORK CARRIED OUT DURING FINANCIAL YEAR (CONT’D) 123 CORPORATE GOVERNANCE 1 2 3 5 6 AL-`AQAR HEALTHCARE REIT ANNUAL REPORT 2023
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