Assessment of Suitability and Independence of External Auditors The Company has established a transparent arrangement with the External Auditors to meet their professional requirements. From time to time, the External Auditors highlight to the Audit Committee and Board of Directors on matters that require the Board’s attention. The Audit Committee is responsible for reviewing the audit, recurring audit-related and non-audit services provided by the External Auditors. The Audit Committee has been explicitly accorded the power to communicate directly with both the External Auditors and Internal Auditors. The terms of engagement for services provided by the External Auditors are reviewed by the Audit Committee prior to submission to the Board for approval. The effectiveness and performance of the External Auditors are reviewed annually by the Audit Committee. In assessing or determining the suitability and independence of the External Auditors, the Audit Committee has taken into consideration of the following: i) the adequacy of the experience and resources of the External Auditors; ii) the External Auditor’s ability to meet deadlines in providing services and responding to issues in a timely manner as contemplated in the external audit plan; iii) the nature of the non-audit services provided by the External Auditors and fees paid for such services relative to the audit fee; and iv) whether there are safeguards in place to ensure that there is no threat to the objectivity and independence of the audit arising from the provision of non-audit services or tenure of the External Auditors. Annual appointment or re-appointment of the External Auditors is via shareholders’ resolution at the AGM on the recommendation of the Board. The External Auditors are being invited to attend the AGM of the Company to respond and reply to the Shareholders’ enquiries on the conduct of the statutory audit and the preparation and contents of the audited financial statement. Where necessary, the Audit Committee will meet with the External Auditors without the presence of Executive Directors and members of management to ensure that the independence and objectivity of the External Auditors are not compromised and matters of concerns expressed by the Audit Committee are duly recorded by the Company Secretaries. In presenting the Audit Planning Memorandum to the Audit Committee, the External Auditors have highlighted their internal policies and procedures with respect to their audit independence and objectivity which include safeguards and procedures and independent policy adopted by the External Auditors. The External Auditors have also provided the required independence declaration to the Audit Committee and the Board for the financial year ended 31 December 2022. The Audit Committee is satisfied with the competence and independence of the External Auditors for the financial year under review. Having regard to this, the Board approved the Audit Committee’s recommendation for the shareholders’ approval to be sought at the AGM on the reappointment of Messrs. UHY as the External Auditors of the Company for the financial year ending 31 December 2022. PART II - RISK MANAGEMENT AND INTERNAL CONTROL FRAMEWORK 9. RISK MANAGEMENT COMMITTEE (“RMC”) The RMC was established on April 2019 comprising the following members: Members Professor Datin Dr Suzana Binti Sulaiman @ Mohd Suleiman (Independent & Non-Executive Director) Dr Nurwahida Mohd Yaakub (Independent & Non-Executive Director) Dato’ Mohd Zahir Bin Zahur Hussain (Managing Director and Chief Executive Officer) GOVERNANCE 69 ANNUAL REPORT 2022 DESTINI BERHAD
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