Reviewing the External Audit Process a. Held two (2) private discussion sessions with the external auditor, Messrs PricewaterhouseCoopers PLT (PwC) without Management on 17 February 2021 and 13 August 2021. These sessions provided the external auditor with the opportunity to openly share concerns about the Group and any related issues requiring attention or significant matters arising from the external audit with the Independent Non-Executive Directors. b. Reviewed and approved the PwC’s Audit Plan and scope of work for the statutory audit of the Financial Statements for the financial year ended 31 December 2021 on 13 August 2021, which covered: • The focus areas planned as follows: i. Risk of management override of controls (in line with International Standards of Auditing requirements). ii. Ensuring revenue is recognised in the correct accounting period and is appropriately supported. iii. Recoverability of non-current assets (including goodwill). iv. Recoverability of inventories and adequacy of provisions on onerous contracts. v. Rationalisation plan by Management - closure of MSM Perlis factory operations. vi. Risk of non-compliance to the financial covenants. • Declaration of PwC’s independence as external auditor. c. Analysed the external audit fees and non-audit fees proposed in respect of the scope of work required for the financial year and recommended the same for approval by the Board. AUDIT, GOVERNANCE AND RISK COMMITTEE REPORT d. Reviewed the assessment of the performance and effectiveness of PwC in respect to their statutory audit services as the external auditor for financial year 2020. The result of evaluation was discussed at the AGRC meeting held on 12 March 2021. Based on the assessment and input from Management, the AGRC was satisfied with the services rendered by PwC. The AGRC recommended the re-appointment of PwC as external auditor for the financial year 2021 for the shareholders’ approval at the Company’s Annual General Meeting. Related PartyTransactions a. Divestment of 100% shares in MSM Perlis Sdn Bhd owned by MSM Malaysia Holdings Berhad to FGV Holdings Berhad (Proposed Disposal) Pursuant to paragraph (3)(a) of the Appendix 10C of the Listing Requirements, the AGRC is required to provide a statement in the announcement and circular pertaining to the divestment to the shareholders of MSM that the AGRC has considered and deliberated all aspects of the Proposed Disposal and the AGRC is of the opinion that the Proposed Disposal is: • In the best interest of MSM. • Fair, reasonable and on normal commercial terms. • Not detrimental to the interest of the minority shareholders. WHO WE ARE STATEMENT & DISCUSSION BY OUR LEADERS HOWWE OPERATE MSM Malaysia Holdings Berhad ANNUAL INTEGRATED REPORT 2021 232
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