KUB Malaysia Berhad Annual Report 2021

Insurance on Employee and Assets In order to attract and retain talent, KUB Group believes it is important to offer a competitive reward package and to increase the compensation positioning against the market compensation to at least to seventieth percentile (70%). Group Hospitalisation and Surgical and Group Term Life Insurance are amongst the benefits covered by KUB Group. Both benefits and insurance include the coverage for the cost of inpatient and outpatient treatment, critical illnesses, rehabilitation, physiotherapy and death from all causes. Besides insurance for its employees, KUB Group also purchases insurance for its physical assets. The coverage includes damage or loss of assets in the event of fire, theft of assets, liability coverage for the legal responsibility to others for accidents, bodily injury or property damage, and coverage for computers and servers. Insurance coverage is reviewed on a yearly basis to ensure comprehensive coverage to mitigate business risks in view of the ever-changing business environment or assets. Internal Audit Internal audit function assesses the Group’s system of internal control, risk management and governance process. The assurance that the internal control, risk management and governance processes within the Group are adequate and complied with relevant requirement is independently and regularly reported to BAC. The corrective actions for the findings raised in the internal audit reports will be taken by the Management based on agreed action plan. Details of Internal Audit activities are provided in the Board Audit Committee Report of this Annual Report. Sustainability Reporting The Group believes that the emerging trend of Economic, Environmental, Social and Governance (‘EESG’) risks and opportunities increasingly affecting business value, share prices and stakeholders’ areas of concerns. By incorporating sustainability considerations into the business strategies and processes, it adds values in the long run as organisation looks beyond short-term profitability and consider medium to long term business viability. For more details, please refer to the Sustainability Statement of this Annual Report. CONCLUSION After a due and thorough inquiry on the information and assurance provided, the Board is satisfied with the process of identifying, evaluating and managing the significant risks that may affect the achievement of the Group’s business objectives. Where exceptions were noted, there was no material control failure or weakness that had resulted in material loss that had not been disclosed in the Group’s financial statements. For areas requiring attention, measures are taken to ensure the on-going adequacy and effectiveness of risk management and internal control. The Board and the Management will continuously improve and seek assurance on the efficiency and effectiveness of the internal control system through independent assessments by the internal and external auditors. The Board has received assurance from the Group Managing Director that the Group’s risk management and internal control system is operating adequately and effectively, in all material aspects. This Statement is made based on the recommendation of the BRMC to the Board of Directors which was approved on 25 August 2021. REVIEW OF THE STATEMENT BY EXTERNAL AUDITORS As required by Paragraph 15.23 of the Listing Requirements, the external auditors, Deloitte PLT have reviewed this Statement on Risk Management and Internal Control. Their limited assurance review was performed in accordance with the ISAE 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Information and Recommended Practice Guide (‘RPG’) 5 (Revised), issued by the Malaysian Institute of Accountants. RPG5 (Revised) does not require the external auditors to form an opinion on the adequacy and effectiveness of the risk management and internal control systems of the Group. Based on their procedures performed, the external auditors have reported to the Board that nothing has come to their attention that caused them to believe that the Statement has not been prepared, in all material aspects, in accordance with the disclosures required by Paragraph 41 and 42 of the Guidelines, nor is it factually inaccurate. 39 ANNUAL REPORT 2021 CORPORATE GOVERNANCE