41 / 178
39
GHL Systems Berhad
(293040-D)
Annual report 2015
2. Monitoring and Reporting
Monthly management meetings are led by the respective country heads for various lines of operations and
business units, on key business performance, operating statistics and regular matters. This enables effective
monitoring of significant variances and deviation from standard operating procedures and budget. The
Board is also kept appraised on the Company’s performance during the scheduled board meetings with
the Company’s business performance and plans being reviewed and deliberated.
3. Policies and Procedures
The Group has defined and documented internal policies and standard operating procedures to ensure
inter alia sound internal controls are embedded and compliance with applicable laws and regulations. The
policies and procedures are also being reviewed on a regular basis to ensure its relevance and effectiveness.
4. Internal Audit Function
As part of the Group’s effort to establish a sound framework for risk management and internal control, an in-
house audit function is established as a key component of its internal control processes. The Group Internal
Audit (“GIA”) reports independently to the ARC and is guided by a formalised Internal Audit Charter.
Acting as the third layer of defence in internal control, the GIA undertakes Internal Audit reviews for the
Group based on an annual internal audit plan approved by the ARC. The results of all internal audit
reviews, together with the findings and recommendations, are presented to Management for discussion
and formulation of the necessary corrective action plans prior to finalisation of the internal audit reports.
At each ARC meeting, the Head of Internal Audit updates the ARC of all the status of ongoing audits and
where appropriate, presents Internal Audit Reports and observations. Relevant parties are invited to be
present during such presentations.
5. Risk Management
a. Risk Management Committee (“RMC”)
The RMCwas established by the Board in 2012 as a key component of the Risk Management Framework.
The RMC, which is headed by the Group’s Chief Executive Officer (“CEO”), comprises the Group’s
Chief Financial Officer (“CFO”) and country heads and financial controllers from each countries. The
responsibilities of RMC are as follows:
•
To identify and assess on an ongoing basis, the risks faced by the Group and thereafter to design
and implement appropriate risk management processes or internal controls to address or mitigate
such risks in an effective manner;
•
To periodically assess and review the continued effectiveness and appropriateness of risk
management processes;
•
To determine and recommend to the Board the Group’s risk appetite and tolerance;
•
To continuously promote an effective risk awareness culture throughout the Group with written
policies and other forms of communication to employees and stakeholders;
•
To be accountable and periodically report to the Board, through the ARC, for the design,
implementation and monitoring of the risk management system.
The Head of Internal Audit was invited to attend meetings of the RMC as an observer and provides
the ARC with an independent assessment of the adequacy and reliability of the risk management
processes and compliance with risk policies.
The RMCmet twice a year to conduct a formalised half-yearly risk assessment and reported the findings
to the ARC. On a quarterly basis, the RMC Chairman, i.e. Group CEO and the Group CFO are invited
to the ARC meeting to formally brief the ARC of any risks related events and/or new risks faced by the
Group and the corresponding action plans taken to mitigate the risks.
Statement on Risk Management and
Internal Control