TERMS OF REFERENCE
TERMS OF REFERENCE
FOR REMUNERATION COMMITTEE
TERMS OF REFERENCE OF THE AUDIT
AND RISK MANAGEMENT COMMITTEE
The Code of Conduct & Ethics for Directors (“the Code”) sets out the underlying core ethical values and commitment to form the fundamental principles on integrity, fairness, transparency, accountability, social and environmental contribution of the Board of Directors (“Board”) of Ygl Convergence Berhad and its Group (“Ygl” or the Company”).
The Board must abide by and uphold the provisions of the Code and the standards therein when carrying out their daily duties and responsibilities.
The objectives of the Code for the Board are to set high benchmark for underlying values of integrity, honesty and ethics to promote adherence to these values for all conducts of the Board to provide guidance to the Directors in observing honest, fair, ethical and law abiding behaviour and to protect the integrity of the Company and interests of the shareholders and all other stakeholders
The Directors shall at all times within the authority conferred upon them:
1.Act in good faith and in the best interests of Ygl and its shareholders;
2.Fulfill their fiduciary obligations with due care, competence and diligence;
3.Conduct themselves responsibly in a professional, courteous and respectful manner;
4.Uphold integrity with honesty, fairness and ethics;
5.Exercise objective and prudent judgment;
6.Avoid situations which give or could give rise to conflict of interest;
7.Abstain from situations, decisions or relationships which give or could give rise to conflict of interest situations;
8.Promptly inform or consult the Board of any such or potential conflict of interest situations;
9.Safeguard the information, properties and facilities of the Company;
10.Protect the reputation of Ygl;
11.Refrain from taking advantage of their position to obtain information or access to information or properties
12.for personal gains and opportunities; and
13.Contribute towards the growth and sustainability of the Company.
1.The Company respects the right of the Directors to partake in outside financial or business ventures on the condition that the activities are legal and do not conflict with the Directors’ duties and obligations. As such, the Directors must not be involved directly or indirectly in any business or other relationships which contradict the best interests of Ygl.
2.A conflict of interest situation is defined as a situation where a Director or family member of a Director, through direct or indirect relationships, obtains personal benefits at the expense of the Company’s best interests. The conflict of interest situations include situations which cause the Company losses in monetary terms, opportunities, resources, reputation, confidential information, properties, business relationships or network.
3.If a Director is in doubt as to whether any business undertaking or financial venture may give rise to conflict of interest situation, the Director should observe the highest standard of conduct, in consultation with the Board or refrain from such undertaking.
1.The Directors must not directly or indirectly, receive or offer any gift or contribution from or to any other person with the intention to solicit for business favours or promises or any other gains. The gift and contribution referred herein include but not limited to goods, cash, hospitality in any form and comparable benefits.
2.The Directors must not even be perceived to be in such compromised situation.
3.The Directors may accept nominal gift of commemorative nature such as tokens of appreciation which do not hold any value in the market place or have value below RM1,000 (Ringgit Malaysia one thousand only) Tokens of appreciation are normally given to Directors for attending certain event as representative of the Company. As such, these tokens of appreciations should be placed in one of the Ygl offices.
1.All private and confidential information about Ygl’s corporate, business and any related matters to which the Director has access or possesses is considered as privileged and must be strictly kept confidential at all times.
2.The Directors must not disclose or divulge any private and confidential information about the Company to any third party including employee of Ygl, ex-employee of Ygl or their families.
3.All Directors are also prohibited from making any forward-looking statement which is based on current expectation to predict or project future event of the Company. Forward looking statements are usually price sensitive.
4.Any disclosure of any information about the Company must be:
-Authorized by the Board; or
-Such information is part of public domain at the time of disclosure; or
-Required by law or any regulatory body including Bursa Malaysia Securities Berhad or
1.All Directors must abide by the applicable laws and regulations relating to dealings with the shares of the Company.
2.All Directors must also abide by the guidelines set out in the Company’s Corporate Disclosure Policy and Procedures.
3.All Directors must not make use of the privileged and confidential information to which he/she has access by virtue of his/her position for personal or any other gains.
1.The Company recognises the importance of dissemination of relevant corporate information to the stakeholders and the wider investment community for informed decision making. The Company shall be represented by the Board and its “Authorised Spokeperson” when making any public representation in respect of disclosing information of the Company to the public including its employees, shareholders, other stakeholders, media or financial community.
2.The Board and its “Authorised Spokeperson” must strictly adhere to the procedures set out in the Company’s Corporate Disclosure Policy and Procedures when making public representation. Public representation encompasses announcements, press releases, speeches, forecast and any other communication must be accurate, timely and reflective of the facts at that time.
1.The assets of the Company include tangible assets comprising property, hardware and equipment, software, infrastructure etc and intangible assets comprising human resources, information, goodwill, relationships with customers, suppliers and business associates etc.
2.The Directors must execute reasonable care and prudence to protect the assets of the Company such that the assets are utilised efficiently and for legitimate purpose.
3.Whilst the Directors do not have legal ownership of the Company’s assets, they have effective control over the acquisition and disposal of the Company’s assets. The Directors must deploy the assets in the best interest of the Company.
4.No Director shall illegally withhold any Company‘s assets or use the assets for purposes other than purported or approved by the Board.
1.Every Director shall in all business conduct comply with the laws and regulations applicable to the Company in all the territories it operates.
2.The Directors must acquire the necessary knowledge relating to their scope of responsibilities to recognize non-compliance issues faced by the Company. The Directors may seek professional advice from external parties such as the corporate secretaries, auditors, other consultants or deliberate with the Management to resolve such non-compliance issue.
3.In the event that any suspected violation of law has or would have occurred, the Directors must immediately notify the Board to initiate investigation and take appropriate remedial action.
1.The Company is committed to create a conducive working environment that is also clean and safe for the Directors and employees. The layout of the offices complies with the applicable safety regulations as well as they are equipped with access lock and CCTV to ensure safety and security.
2.The Company is committed to prevent waste of natural resources and put in place recycling of waste materials procedures.
3.The Company’s business does not involve production or disposal of any material which may have hazardous impact on the environment.
1.The Board reserves the right to amend and modify the provisions of the Code from time to time in line with any changes in the Company’s vision, business direction, business environment and laws and regulations etc. Such amendments shall take effect from the date of adoption.
1.In the event where a Director has breached the Code, the Board shall take appropriate action deemed necessary
1.Pursuant to the Malaysian Code on Corporate Governance 2012, a copy of the Code is posted on the Company’s website.
The Board of Directors (the “Board”) of Ygl Convergence Berhad (“Ygl” or the “Company”) recognizes the importance of communications with the stakeholders and the broader investment community in relation to the business, operations and financial performance of the Company. In this respect, the Board is committed to ensuring that the information released is accurate, consistent, timely, reflective of the facts at that time, widely disseminated and where applicable, the information is filed with the relevant regulators in accordance with the applicable laws and regulations.
The Board must abide by the Corporate Disclosure Policy and Procedures (“Corporate Disclosure Policy”) hereunder when dealing with disclosure of corporate information of the Company to the public
The objectives of the Corporate Disclosure Policy are:-
1.to establish written guidelines and procedures in dealing with corporate disclosure;
2.to ensure the Board’s adherence to the policy and procedures to preserve confidentiality of material information;
3.to promote understanding of the Company’s business and enhance the corporate image of the Company via open and accessible communications
4.to protect the Company’s interests in compliance with the regulatory requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”) and best practice recommended by the Malaysian Code on Corporate Governance 2012 (“MCCG 2012”).
The Corporate Disclosure Policy is applicable to all Directors, officers and employees of the Company and Group and the “Authorised Spokeperson” appointed by the Board. Corporate disclosure encompasses but is not limited to the followings:
1.Corporate disclosure documents such as annual and quarterly reports filed with Bursa Securities and Securities Commission;
2.Written financial and non-financial statements filed with the Malaysian securities regulators and relevant authorities;
3.Interview with media;
4.Speeches made in industry or investor conferences;
5.Press releases and news conferences;
6.Presentation by senior management;
7.Oral statements made in meetings of all kinds;
8.Communications with shareholders;
9.Information contained on the Company’s website and other digital media;
10.Any other communication with the public.
1.The Board is entrusted with the responsibilities to:-
-Determine whether the information is material information;
-Timely disclose material information to the securities regulators;
-Ensure compliance with the Corporate Disclosure Policy;
-Monitor disclosure control measures and procedures
2.Decision of the Board will be based on majority where the determination of material information does not achieve unanimous decision. Majority herein means more than 50% of the Board’s vote.
1.The Board designates the Chief Executive Officer (“CEO”) as the “Authorised Spokeperson” to speak on behalf of the Company on all matters pertaining to the Company. In the absence of the CEO during urgent issue, the Board may designate the Executive Director to speak on behalf of the Company. The matters for response by the CEO as “Authorised Spokeperson” cover the Company’s operations, financial position, future direction, strategies, governance, management, products and services.
2.Any other person who has not been designated as the Authorised Spokeperson must not respond under any circumstances to enquiries from the media, investment community or others. All such enquiries should be directed to the Board for deliberation and the Authorised Spokeperson with the consensus of the Board shall respond accordingly.
1.All private and confidential information about Ygl’s corporate, business and any related matters to which the Director has access or possesses is considered as privileged and must be strictly kept confidential at all times.
2.All private and confidential information about Ygl’s corporate, business and any related matters to which any Ygl employee has access or possesses during the course of work is considered as restricted and must be strictly kept confidential at all times.
3.Outside parties who have certain information about Ygl’s business during the course of work are sternly informed of the consequence of divulging such confidential information to any other person including employee of Ygl. Outside parties are required by the Management to declare their commitment to non-disclosure through written confidentiality agreement.
The Management has implemented certain control measures in order to prevent misuse or inadvertent disclosure of confidential information. These control measures must be observed at all times:
1.Restricted access and password
Confidential documents and files are kept in safe place with lock by the person in charge. Access to information in the computer system is restricted by password and protected files.
2.No discussion in public places
Ygl employees including Directors have been advised not to discuss company matters in public places including hallways, elevators, restrooms, restaurants etc. In the event that urgent matters must be discussed outside the office premises, caution should be exercised such that the information including identity of relevant party must be protected.
3.Exercise caution when reading confidential documents outside the office
Generally office documents cannot be taken out of the office except for certain sales documents. Caution should be exercised that Company’s documents must not be left unattended or digital information left open for others to see.
4.Visitors to office
Visitors to the office are prohibited to enter to the work area of the Company. They should be seated at the reception area.
5.No participation in social media discussion
All Directors and employees are strictly prohibited from participating in social media to discuss any matter which may relate to the Company to mitigate the risk that certain information may be inadvertently disclosed to unauthorised persons including other employees.
Material information is defined as any information relating to the business, operations and financial performance of the Company that would result in or would reasonably expected to result in a significant change in the market price, value or market activity of the Company’s securities or decision of a shareholder of the Company or an investor’s choice of action.
The following basic disclosure principles are set out to ensure timely disclosure of material information in compliance with the requirements of Bursa Securities:-
1.Timely announcement to Bursa Malaysia
Material information must be announced to Bursa Securities immediately or within the limited time frame set by Bursa Securities.
2.Consistent determination of material information
The Board must consistently apply the basis for determining the materiality of information.
3.Factual and non-speculative disclosure
The material information disclosed must be factual and not speculative in nature and must include any information the omission of which would make the rest of the disclosure misleading.
4.Immediate correction of material error in disclosure
The Company must immediately correct any material error contained in an earlier disclosure of which the Company subsequently know.
The Company does not comment on verbal rumours unless there is significant reaction in the market which the Company’s securities are listed. In response to published rumours, it is up to the Board to decide on the course of action. It is not the Company’s policy to comment on rumours or speculations in the market.
6.Prohibit of informal meetings
The Company shall not conduct informal meetings or issue “off record” comments in public.
7.Disclosure of unfavourable material information
Unfavourable material information must be announced to Bursa Securities immediately or within the limited time frame set by Bursa Securities consistent with announcement of other material information.
- Equal access to material information by the public
The public should have equal access to the disclosed material information. There should not be disclosure of material information to selective crowd only.
1.Once the Board determines that an issue or a development is material information that must be disclosed, it will authorise the issuance of an announcement to Bursa Securities. There may be ensuing press release or response to public queries or media interview.
2.The public disclosure materials must contain sufficient details in plain language so that investors or public media can understand the substance and relevance of the material information to make informed decision.
3.The public disclosure materials must be circulated to the Board for approval. The Board shall give due considerations to the terms and conditions or obligations of the Company under any agreement to which the Company is a party.
4.The public disclosure materials shall be filed with Bursa Securities in compliance with the regulations.
5.If a press release is arranged, the designated representative of the Company will prepare the “press kit” which include a contact point for the Company and the media.
6.All announcements made to Bursa Malaysia are available on the Bursa Securities’s website at www.bursamalaysia.com. The Company will also post the announcement on the Company’s website at www.yglworld.com. The posting on the Company’s website will include a notice stating that the information posted was accurate at the time of posting but may be superceded by subsequent news releases.
1.The Board must be immediately notified if any Director, officer or employee of Ygl becomes aware of any information publicly disclosed by the Company contained or may have contained a misrepresentation or there has been or may have been a failure to make timely disclosure of material information.
2.The Board shall conduct a reasonable investigation of the material information take remedial action and promptly disclose the said misrepresentation or omission and file explanation to the relevant regulatory body.
1.If a material information includes a statement of opinion by an external expert (as defined by the regulatory body), the Company shall obtain written consent from the external expert who issues the opinion or statement for the filing prior to submission of public disclosure material with the relevant regulatory body.
2.The Board should take reasonable steps to ensure that at that time there is no reasonable ground to believe that the statement made on the authority of the external expert contain any shortcoming and that the disclosure fairly represents the opinion of the expert.
Under Section 188(1) of the Capital Market & Services Act 2007 (“CMSA”), a person is an “insider” if that person:
- possesses information that is not generally available which on becoming generally available a reasonable person would expect it to have a material effect on the price or the value of the securities; and
- knows or ought reasonably to know that the information is not generally available
Under Section 188(2) of the CMSA, an “insider” shall not, whether as principal or agent, in respect of any securities to which information in Section 188(1) relates:
- acquire or dispose of, or enter into an agreement for or with a view to the acquisition or disposal of such securities; or
- procure, directly or indirectly, an acquisition or disposal of, or the entering into an agreement for or with a view to the acquisition or disposal of such securities.
As such, any of but not limited to the following persons may be implicated:
- Directors and officers of the Company and subsidiary companies;
- Suppliers, business affiliates, professionals who deal with the Company and Group;
- Any other person, company or organisation who has been informed of such material information by the above persons.
2.Restriction on Trading
The persons stated in the above paragraph are prohibited from trading in the Company’s securities until after the material information has been publicly disclosed.
Any person who has insider knowledge of undisclosed material information is prohibited from acquiring or disposing of the Company’s securities.
It is also an offence for both tip provider and receiver of material non-public information to trade in the Company’s securities.
The Directors should exercise caution such that they do not inadvertently disclose any undisclosed material information to anyone in any situation. The Board has the responsibility to ensure that any “insider” information is secured and take precaution to prevent slippage of information.
1.“Closed Period” as stated in the Listing Requirements of ACE Market of Bursa Securities Malaysia refers to the period commencing 30 calendar days before the targeted date of announcement up to the date of announcement of the Group’s quarterly results to Bursa Securities.
2.During “Closed Period”, the Board and its Authorised Spokeperson are prohibited from commenting on current period financial estimates and assumptions. The Board should be cautious if the Directors have to attend any investment meeting, conference or media interview. The relevant representative of the Company must choose their topic and conversation carefully avoiding any material information which has not been disclosed to the public.
1.The Board from time to time may convey the future direction of its business to the public to enhance the image of the Company and Group and promote its products and services. The Board should be reminded to keep the discussion topics to general trends, events and other matters reasonably expected based on historical and current known information.
2.All documents which contain forward looking information should be separately identified so that the user is cautioned not to convey it at all.
3.The conveying of forward looking information gives rise to uncertainties and risks which could affect the actual results or development of business to vary materially from those anticipated if such information is not disclosed at all.
All relevant announcements required by law are fully posted on the Company’s website while press releases, analyst reports, media interviews, conference presentation etc are only shown the relevant excerpts. These are made available on the Company’s website for a reasonable period of time. The content of the Company’s website is periodically reviewed by the Management and it is kept up to date with the latest disclosures.
2.Meetings with Analysts, Investors and Media Interviews
There may be meetings with analysts, investors and other industry groups as well as media interviews arranged for the Directors. The Directors shall convey information about the Company in accordance with this Corporate Disclosure Policy.
The Directors may be requested by analyst to review and make comments on the reports written by them in relation to the Company. The Directors should limit the comments to identifying publicly disclosed information which could have impact on the assumptions, economic model or basis used by the analyst and pinpointing inaccuracies with reference to publicly available information.
The Directors shall not influence or attempt to influence the conclusion of an analyst report. And the analyst report should carry a disclaimer that the view expressed in the report including any statement or projection made is strictly the views of the analyst and not that of the Company.
4.Other Company Materials – Presentation to Outsiders
The contents of all Company materials such as Company profile, products and services brochures, conferences & industry presentation etc are reviewed and approved by the Directors before they are presented to prevent inadvertent disclosure of any material information
The Board will review this Corporate Disclosure Policy periodically and reserves the right to amend and modify the provisions of the policy and improve disclosure procedures from time to time in line with any changes in laws and regulations. Such amendments shall take effect from the date of adoption.
Where a Director, officer or employee of Ygl does not comply with this Corporate Disclosure Policy but does not contravene any securities or criminal law, the Board shall take appropriate disciplinary action deemed necessary; where there is also violation of any securities or criminal law, the Board shall refer the matter to the appropriate regulatory authorities or police for further investigations.
Pursuant to the MCCG 2012, a copy of the Corporate Disclosure Policy is posted on the Company’s website.
The Committee shall be appointed by the Board from amongst the directors of the Company and shall consist of no fewer than 3 members, all of whom must be non-executive directors and a majority of whom are independent.
The Chairman of the Committee shall be appointed among the members of the Committee.
The Committee shall meet as and when is required. In order to form a quorum, at least two (2) members of the Committee must be present.
A Resolution taking the form of one or more documents in writing signed or approved by other electronic communications by a majority of the members of the Committee, provided that they are sufficient to form a quorum at a meeting of the Committee, shall be as valid and effectual as if it had been passed at a meeting of the Committee duly called and constituted; provided that the resolution is circulated to all members of the Committee. All such resolutions shall be described as “Circular Resolution of Nominating Committee” and shall be forwarded or otherwise delivered to the Secretary upon signing without delay, and shall forthwith be recorded by the Secretary in the Company’s Minutes Book. Any such resolution in writing may be contained in one (1) document or separate copies thereof (which may be prepared and circulated by electronic communications with copy sent by courier or registered post) which is signed by one (1) or more of the member of the Committee.
The Committee may invite any senior management staff or professional adviser to be in attendance.
The Company Secretary or their nominee shall be the secretary of the Committee.
The Committee shall:-
- before any appointment is made by the board, evaluate the balance of skills, knowledge and experience on the board and, in the light of this evaluation prepare a description of the role and capabilities required for a particular appointment. In making its recommendation, the Committee should consider the candidate's:-
- review and recommend to the board, candidates to fill board vacancies as and when they arise
- give full consideration to succession planning for directors in the course of its works, taking into account the challenges and opportunities facing the company, and what skills and expertise are therefore needed on the Board in the future
- review the structure, size and composition (including skills, knowledge and experience) required of the Board compared to its current position and make recommendations to the Board with regard to any changes
- Skills, knowledge, expertise and experience;
- Integrity; and
- In the case of the candidates for the position of independent non-executive directors, the NC should also evaluate the candidate’s ability to discharge such responsibilities/ functions as expected from independent non-executive directors
- review and recommend the re-appointment of any non-executive director at the conclusion of their specified term of office having given due regard to their performance and ability to continue to contribute to the Board in the light of the knowledge, skills and experience required
- review and consider, in making recommendations, candidates for directorships proposed by Chief Executive Officer and, within the bounds of practicability, by any other senior executive or any director or shareholder
- review and recommend to the board, directors to fill the seats on board committees
- assess the effectiveness of the board as a whole and assess the contribution of each individual director, including independent non-executive directors, as well as the chief executive officer
- review and recommend the re-appointment and re-election of Directors of the Company for shareholders’ approval
The role of the Remuneration Committee (“Committee”) is to support and advise the Board (“Board”) of Ygl Convergence Berhad (“Company”) in relation to the remuneration packages of Executive Directors, Non-Executive Directors and Senior Management by reference to market practice, regulatory provisions and the interests of shareholders and other stakeholders.
The Committee shall be accountable to the Board and its responsibilities are set out in these Terms of Reference. In making recommendations to the Board, the Committee does not, of itself, have the power or authority of the Board in dealing with the matter on which it advises except where certain powers are specifically set out in these Terms of Reference or are delegated by the Board.
Remuneration in this context shall be interpreted in the broadest sense to include all benefits and terms of employment.
The objectives of the Committee are to:-
a) establish formal and transparent procedure for developing policy on executive remuneration and fixing the remuneration package of individual directors;
b) ensure remuneration packages that attract, retain and motivate Executive Directors and senior management to maximize the value and promote long term success of the Company; and
c) review remuneration packages of the executives to link rewards to corporate and individual performance for their contributions to the Company and the Group.
All Committee members must be Independent Non-Executive Directors and a majority of them must be Independent Directors as determined by the Board from amongst the Directors of the Company. The Committee must consist of at least three (3) members. The Committee shall elect a Chairman from among its members. The Chairman of the Board shall not be Chairman of the Committee.
If a member of the Committee resigns or for any reason ceases to be a member which results in the number of the members to fall below three, the Board shall within three months from the date of that event appoint such number of new members as may be required to make up the minimum required three members.
The Committee should carry out the duties and responsibilities below in respect of the parent company and the Group as a whole, as appropriate. The Committee shall:-
a) review and recommend remuneration policy of all executive directors and senior management with regards to all factors including relevant legal and regulatory requirements, the performance of the individual and independent reference to market rates for similar jobs of comparable companies in the same industry in order to align with business strategy and long term objectives of the Company;
b) not be involved in any decisions as to their own remuneration. Remuneration of Non- Executive Directors shall be a matter for the Board subject to shareholders’ approval in the general meeting;
c) review ongoing appropriateness and relevance of the remuneration policy;
d) review and recommend performance evaluation for the annual salary increment, performance bonus and any incentive for executive directors and senior management based on the performance measurement benchmark set by the Company;
e) review and recommend any benefits in kind for the executive directors and senior management;
f) review and recommend any compensation policy for the executive directors and senior management is fair and just compared with market practice;
g) carry out governance responsibilities related to remuneration in compliance with the Malaysia
h) review the design of all share options or incentive plans prior to the approval by the Board and shareholders, determining when, the amount of such plan, designated individuals and the performance targets to be used;
i) recommend engagement of external professional advisors to assist the Committee and the
Board on remuneration matters where necessary; and
j) furnish a report on its yearly activities which may be part of corporate governance statement in the annual report of the Company
In order to perform its duties, the Committee:-
a) shall be granted full access to Company information and can seek information from any employee of the Company; and
b) is authorised by the Board to obtain, at the Company’s expense, external legal or other
professional advice on any matters within its terms of reference.
The Committee shall meet at least once a year or as frequently as required.
In the event the elected Chairman is unable to attend a meeting, a member of the Committee shall be nominated as Chairman for the meeting.
Subject to the notice and quorum requirements as provided in these Terms of Reference, meeting of the Committee may be held and conducted through any digital telecommunication which allows all members in the meeting to hear one another. A member so participating shall be deemed to be present in person at the meeting and shall be entitled to vote and be counted in a quorum accordingly.
Only members of the Committee have the right to attend committee meetings. However other individuals such as the Chief Executive Officer, Head of Human Resources and external advisers may be invited to attend for all or part of any meeting as and when necessary.
- The quorum for a meeting of the Committee shall consist of not less than two (2) members.
Unless otherwise agreed, notice of each meeting confirming the venue, time and date, together with an agenda of items to be discussed, shall be forwarded to each member of the Committee and any other person required to attend, no later than seven (7) days before the date of the meeting. Supporting documents shall be sent to committee members and other attendees as appropriate at the same time.
The Company Secretary or his/her nominees or such other persons authorised by the Board shall act as the Secretary of the Committee. The Company Secretary shall record, prepare and circulate the minutes of the meetings of the Committee in a timely manner to enable proper consideration to be given to the issues and ensure that all the minutes are properly kept and produced for inspection if required.
A resolution in writing, signed by a majority of the Committee members present in Malaysia for the time being entitled to receive notice of a meeting of the Committee, shall be as valid and effectual as if it had been passed at a meeting of the Committee duly convened and held. Any such resolution may consist of several documents in like form, each signed by one or more of the members of the Committee.
The Committee shall put forth a report for shareholders’ approval at the annual general meeting.
The Committee Chairman shall attend the annual general meeting to answer any questions posed by the shareholders on the activities of the Committee
The Committee shall prepare and adopt a report on its activities for incorporation in the Annual Report.
The Committee shall report to the Board to:
- ensure that the Board has a whole has insight into the key issues discussed by, and the decisions of, the Committee;
- raise the awareness of the Board; and
- assist in the periodic review of the Committee’s performance.
In the event where a Director has breached the Code, the Board shall take appropriate action deemed necessary
These Terms of Reference will be reviewed and updated from time to time in line with any changes in the corporate governance requirements as well as in consistent with the objectives and responsibilities of the Committee. Such amendments shall take effect from the date of adoption.
Pursuant to the Malaysian Code on Corporate Governance 2017, a copy of the Code is posted on the Company’s website.
The Board has approved and adopted the terms of reference for Remuneration Committee on 27
1.1 The Audit and Risk Management Committee (“Committee”) members shall be appointed by the Board of Directors with at least three (3) members, of which all the Committee members must be non-executive directors, with a majority of them being Independent Directors.
The definition of “Independent Directors” shall have the meaning given in Rule 1.1 of the Listing Requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”) for ACE Market.
1.2 The members of the Committee shall select a Chairman from among its members who shall be an Independent Director. In the absence of the Chairman of the Committee, the other members of the Committee shall amongst themselves elect a Chairman who must be independent director to chair the meeting.
1.3 If a member of the Committee resigns, dies or for any other reason ceases to be a member with the result that the number of members is reduced below three (3), the Board of Directors shall, within three (3) months of that event, appoint such number of new members as may be required to make up the minimum number of three (3) members.
1.4 No former key Audit Partner shall be appointed as a member of the Committee before observing a cooling-off period of at least two (2) years before being appointed as a member of the Committee.
2.1 The Committee shall, in accordance with a procedure to be determined by the Board of Directors and at the cost of the Company:-
(i) have explicit authority to investigate any matters within its term of reference;
(ii) have full and unlimited/unrestricted access to any information and resources/documents which are required to perform its duties as well as to the internal and external auditors and senior management of the of the Company and its subsidiaries as relevant to its activities from any employee of the Company or the Group and all employees are directed to co-operate with any request by the member of the Committee;
(iii) have direct communication channels with the external auditors and person(s) carrying out the internal audit function or activities (if any);
(iv) be able to obtain independent professional or other advice in the performance of its duties and to secure the attendance of outsiders with relevant experience and expertise if it consider necessary; and
(v) where the Committee is of the view that the matter reported by it to the Board of Directors has not been satisfactory resolved resulting in a breach of the Listing Requirements for ACE Market, the Committee shall promptly report such matter to Bursa Securities.
3.1 The Committee shall assist the Board of Directors in fulfilling its fiduciary responsibilities as to accounting policies and reporting practices of the Company and its subsidiaries and the sufficiency of auditing relating thereto.
3.2 The duties of the Committee shall include a review of the following and report the same to the Board of Directors of the Company:-
i.with the external auditor, the audit plan and their management letter (if any);
ii.with the external auditor, their evaluation of the internal controls and management information systems;
iii. with the external auditor, their audit report and actions to be taken;
iv.the assistance given by the employees of the Company to the external auditor;
v.to convene meeting with the external auditors without the presence of the Executive Directors and the management of the Company at least twice a year;
vi.to discuss with the Company’s management the scope and quality of accounting and financial reporting controls in effect;
vii. to assess the suitability and independence of external auditors, and to recommend their appointment and reappointment, their audit fees and any question of resignation or dismissal;
viii. the quarterly results and year end financial statements, prior to the approval by the Board of Directors, focusing particulars on:
i) any changes in or implementation of major accounting policies and practices;
ii) significant matters highlighted including financial reporting, significant judgements made by management, significant adjustments arising from the audit and how these matters are addressed;
iii) the going concern assumption;
iv) significant and unusual events or transaction and how these matters are addressed;
v) compliance with accounting standards and other legal requirements; and
vi) key audit matters that relate to the modified opinion or material uncertainty related to going concern (including steps taken (if any) to address those matters)
ix) any letter of resignation from the external auditors of the Company; and
x) whether there is reason (supported by grounds) to believe that the Company’s external auditor is not suitable for re-appointment.
3.3 to do the following, in relation to the internal audit function:
(i) review the adequacy of the scope, functions, competency and resources of the internal audit functions and that it has the necessary authority to carry out the work;
(ii) review the internal audit programme, process, the results of the internal audit programme, processes or investigation undertaken and whether or not appropriate action is taken on the recommendations of the internal audit function;
(iii) review any appraisal or assessment of the performance of members of the internal audit function;
(iv) approve any appointment or termination of senior staff members of the internal audit function;
(v) take cognizance of resignation of internal audit staff members and provide the resigning staff member an opportunity to submit his reasons for resigning.
3.4 To review the cost effectiveness, independence and objectivity of the external auditors and recommend for the appointment/re-appointment of the external auditors, the audit fee and any questions of resignation or dismissal of external auditors.
3.5 To verify the allocation of employees’ share option scheme (“ESOS”) in compliance with the criteria as stipulated in the by-laws of ESOS of the Company, if any.
3.6 To establish policies governing the circumstances under which the contract in relation to the provision of non-audit services can be entered into by the Group with its external auditors and procedures that need to be adhered.
3.7 To review the adequacy and effectiveness of risk management and internal control systems instituted within the Group.
3.8 To consider and examine such other matters as the Board and/or the Committee considers appropriate.
3.9 To evaluate the risk assessment processes, its adequacy and effectiveness and measures in place are adequate to minimise any exposures to risks including frauds.
3.10 The duties of the Committee in relation to risk management shall include the following and report the same to the Board of Directors of the Company:-
(i) advise the Board on major matters related to risk management;
(ii) review the alignment of risk management framework with risk profile and the achievement of corporate objectives;
(iii) review the adequacy of risk management strategies and policies;
(iv) review changes to risk parameters and acceptable tolerance;
(v) review the effectiveness of the risk monitoring and reporting mechanism;
(vi) oversee the Management’s activities in managing critical risks related to strategic, financial, operational and compliance;
(vii) ensure a culture of risk management within the Group by developing lines of responsibilities and account-abilities through awareness, education and training for all levels of staff;
(viii) ensure infrastructure , resources and systems are in place;
(ix) evaluate likelihood and magnitude of risk impact;
(x) obtain feedback from internal and external auditors and the Management on adequacy of risk management and internal control system; and
(xi) recommend improvement to risk management strategies and processes for the Board’s approval.
3.11 To review and endorse any related party transactions and conflict of interest situation that may arise within the Company or the Group including any transaction, procedure or course of conduct that raises question of management integrity.
4.1 In the absence of the Chairman of Committee, the remaining member present shall elect one from amongst themselves to chair the meeting.
4.2 Unless otherwise agreed, the notice of the meeting together with the relevant meeting papers shall be send to each member of the Committee at least five (5) business days before the date of the Committee meeting.
4.3 Meetings shall be held not less than four (4) times a year with a due notice of issues to be discussed, and shall record its conclusions in discharging its duties and responsibilities. The quorum for the Committee Meeting shall be two (2) members and majority of members present must be independent Directors.
4.4 In line with the Company’s Constitution, a member may participate in a meeting of the Committee by means of conference telephone, conference videophone or any communication equipment which allows all persons participating in the meeting to hear each other, without a member being in the physical presence of another member or members of the Committee, and participation in a meeting pursuant to this provision shall constitute presence in person at such meeting. The members of the Committee participating in any such meeting shall be counted in the quorum for such meeting and subject to there being a requisite quorum in accordance with the terms of reference of the Committee, all resolutions agreed by the members of the Committee in such meeting shall be deemed to be as effective as a resolution passed at a meeting in person of the Committee duly convened and held. A meeting conducted by means of a conference telephone or similar communications equipment as aforesaid shall be deemed to take place where the largest group of those participating is assembled or, if there is no such group, where the chairman of the meeting then is.
4.5 A Resolution taking the form of one or more documents in writing signed or approved by other electronic communications by a majority of the members of the Committee, provided that they are sufficient to form a quorum at a meeting of the Committee, shall be as valid and effectual as if it had been passed at a meeting of the Committee duly called and constituted; provided that the resolution is circulated to all members of the Committee. All such resolutions shall be described as “Circular Resolution of Audit and Risk Management Committee” and shall be forwarded or otherwise delivered to the Secretary upon signing without delay, and shall forthwith be recorded by the Secretary in the Company’s Minute Book. Any such resolution in writing may be contained in one (1) document or separate copies thereof (which may be prepared and circulated by electronic communications with copy sent by courier or registered post) which is signed by one (1) or more of the member of the Committee.
4.6 Upon the request of the external auditors, the Chairman of the Committee shall convene a meeting of the Committee to consider any matter the external auditors believe should be brought to the attention of the directors or shareholders.
4.7 The present of the external auditors will be requested if required.
4.8 The Chairman of the Committee shall engage on a continuous basis with senior management, the head of internal audit and the external auditors in order to be kept informed to the matters affecting the Company.
4.9 The Finance Manager, the head of internal audit and representatives of the external auditors should normally attend meetings. Other Board members and employees may attend meetings upon the invitation of the Committee. However, the Committee shall meet with the external auditors, the internal auditors or both, without other Board members and management present at least twice a year or/and whenever deemed necessary.
4.10 Questions arising at any meeting of the Committee shall be decided by a majority of votes, the Chairman of the Committee shall have a second or casting vote.
5.1 The Chairman of the Committee shall report on each meeting to the Board of Directors.
5.2 The Company Secretaries shall be the secretaries of the Committee.
5.3 Minutes of each meeting shall be kept at the registered office and distributed to each member of the Committee and also to the other members of the Board.
5.4 The minutes of the Committee meeting shall be signed by the Chairman of the meeting at which the proceedings were held or by the Chairman of the next succeeding meeting.
The Board has approved the terms of reference for Committee on 20 August 2018.