CAHYA MATA SARAWAK ANNUAL REPORT 2016

www.cmsb .com.my Section 06 Governance Cahya Mata Sarawak Berhad 68 GROUP AUDIT COMMITTEE REPORT Composition The Committee comprises the following Board members: Mr Chin Mui Khiong Appointed Chairman on 27 April 2016 (Independent, Non-Executive Director) Y A M Tan Sri Dato’ Seri Syed Anwar Jamalullail (Independent, Non-Executive Director) Datu Hubert Thian Chong Hui (Independent, Non-Executive Director) Datuk Kevin How Kow Retired as Director and Chairman on 27 April 2016 (Independent, Non-Executive Director) Meetings in 2016 During the year ended 31 December 2016, the Committee held six (6) meetings which were attended by the members as follows: Name of Directors Total Meetings Attended Mr Chin Mui Khiong - Chairman 6/6 (100%) Y A M Tan Sri Dato’ Seri Syed Anwar Jamalullail 6/6 (100%) Datu Hubert Thian Chong Hui 6/6 (100%) Datuk Kevin How Kow – Retired on 27 April 2016 2/2 (100%) The Committee held three (3) meetings with the external auditors on 29 February 2016, 11 March 2016 and 29 November 2016 without the presence of Management to discuss the results of the audit, extent of cooperation THIS REPORT PROVIDES DETAILS OF THE COMPOSITION OF THE GROUP AUDIT COMMITTEE (“THE COMMITTEE”), A SUMMARY OF THE WORK OF THE COMMITTEE AND HOW IT HAS MET ITS RESPONSIBILITIES, AND A SUMMARY OF THE WORK OF THE INTERNAL AUDIT FUNCTION DURING THE YEAR ENDED 31 DECEMBER 2016. provided by the Company and officers and any other observations that they may have during the annual audit. Summary of the Work of the Committee in 2016 The Committee carried out its duties in accordance with its term of reference during the financial year and up to 14 March 2017. The work undertaken by the Committee to meet its responsibilities during the period of reporting was as follows: Financial Reporting In overseeing financial reporting, the Committee: a) Reviewed with the appropriate officers of the Group the quarterly results and annual financial statements of the Company and the Group, focusing particularly on significant changes in or implementation of accounting policies and practices, accounting treatments, significant judgements made by Management, adjustments arising from the audits, compliance with accounting standards (“MFRS”) used and disclosure requirements, comments and responses to audit issues and other legal requirements to ensure that the financial statements present a true and fair view of the Company’s financial performance prior to making a recommendation to the Board for approval and public release thereof; b) Deliberated significant accounting/audit issues and unusual events or transactions and reasonableness of accounting standards application highlighted by the external auditor and/or Management to derive the Company’s financial statements, and ensured that appropriate action was taken; and c) Assessed the effectiveness of the Company’s internal control system over financial reporting by both internal and external auditors, including information security and control for effective and efficient financial reporting. Internal Audit During the year, the Committee carried out the following activities to ensure the internal audit function is adequately resourced and competent in carrying out the planned activities for the next three (3) years. The Committee in discharging its duties: a) Reviewed and approved the adequacy of the risk- based internal audit plan, scope of examination and internal audit reports for the Company and its subsidiaries issued by Group Internal Audit Department and external parties on the effectiveness and adequacy of governance, risk management, operational and compliance processes;