S E C T I O N 5 C O R P O R A T E G O V E R N A N C E 103 CORPORATE GOVERNANCE STATEMENT Oversight and Assessment of the Suitability and Independence of External Auditors The Board has established a transparent relationship with the Company’s External Auditors and Internal Auditors via the BARC who has explicit authority to communicate directly with them. The External Auditors confirmed to the BARC of their independency at each financial year and during their presentation of relevant audit Memorandum. The Board considered the suitability and independence of the External Auditors during the discussion of the Group Audit Plan for the financial year ended 31 December 2021. The factors that take into account including the adequacy of experience and resources of the firm and professional staff assigned to the audit and the level of non-audit services to be rendered by the External Auditors to the Group for the financial year under review. The BARC had conducted an annual assessment of the timeliness, competence, audit quality and resource capacity of the external Auditor in relation to the audit, the nature and extent of the non-audit services rendered and the appropriateness of the level of fees. The BARC had also obtained assurance confirming that the External Auditors are independent in accordance with the terms of all relevant professional and regulatory requirements. Risk Management and Internal Control The Board has the oversight responsibility of the adequacy and effectiveness of the Manager’s system of internal controls which comprises the governance, risks and controls aspects. The Board believes that effective maintenance of the system is important to help the Fund to achieve its various objectives at many levels and having considered the risks that the Fund faces whilst balancing out the interest of its many stakeholders and protecting the assets and investments. The Board fulfils its oversight function of risk management and internal control system via the BARC. The Enterprise Risk Management (“ERM”) Framework provides guidance to both the Board and Management on the risk management reporting structure and governance, processes, assessment methodologies and tools. The Management of key operating companies adopt and apply the prescribed methodologies to identify, evaluate, treat, control, track and report the Strategic and Business, Financial, Compliance and Operational Risks based on the risk appetite set. In addition to the ERM Framework, the Manager has in place an approved Compliance Framework for management of Compliance Risks which are recognised as part of Operational Risks under the ERM Framework. An overview of the Board’s responsibility and descriptions of the key components of system of internal control which include the conduct of reviews by the Internal Audit Function, risk management and compliance management is set out in the Statement on Risk Management and Internal Control on pages 112 to 118 of this Annual Report. Internal Audit and Assurance The Board has established an Internal Audit Function to provide assurance on the effectiveness of risk, control and governance processes. Oversight of the Internal Audit Function is delegated to the BARC to ensure that there are sufficient resources and internal audits are carried out objectively, effectively and independently. The Internal Audit Function is outsourced to a team of competent and qualified auditors at Crowe Governance Sdn Bhd, who reports directly to the BARC. The Internal Auditors attended all meetings of the BARC during the financial year. The BARC’s reviewed the scope of work and reports by the Internal Auditors and the detailed description of the Internal Audit Function are provided in the BARC Report on page 109 of this Annual Report. The Internal Audit Function discharges its duties in accordance with internationally recognised framework and guidelines as described on page 117 in the Statement on Risk Management and Internal Control and page 109 in the BARC Report of this Annual Report, respectively.
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