PRG Holdings Berhad Annual Report 2019

PRG HOLDINGS BERHAD 58 REPORT OF THE AUDIT AND RISK MANAGEMENT COMMITTEE cont’d ACTIVITIES OF THE AUDIT AND RISK MANAGEMENT COMMITTEE (continued) (ii) External Audit • Reviewed the External Auditors’ audit plan covering the audit approach, scope of work and area of significant audit attentions, audit reporting timeline and deliverables. • Reviewed the audit completion report which detailed the areas of audit emphasis, key audit matters identified by the External Auditors that requires the exercise of significant judgement by Management, updates on financial reporting and Malaysian Financial Reporting Standards (“MFRS”) applicable to the Group and the relevant impact on application of the MFRS. • Reviewed the difference between the consolidated loss after tax as per the audited results and the unaudited results announced to Bursa Securities to ensure no variation of more than 10% that warrants immediate disclosure to Bursa Securities. • Confirmed with the External Auditors that the Audit and Risk Management Committee has no knowledge of any fraud related matters affecting the Group, actual or potential instances of litigations and claims, ongoing or pending, for or against the Group and breach or non-compliance with laws and regulations. • Reviewed the extent of assistance provided by Management to the External Auditors without the presence of Management and Executive Directors and discussed significant issues affecting the Group arising from the audit with the External Auditors. • Reviewed the assessment report on the suitability and independence of the External Auditors including non- audit services provided by the External Auditors to the Company and corresponding fees and proposed to the Board the re-appointment of the External Auditors. The assessment criteria encompassed audit planning and design, audit execution, audit fees and independence of the External Auditors. (iii) Internal Audit • Reviewed staffing requirement of the in-house Internal Audit Department to ensure it is adequately staffed by employees with relevant skills, knowledge and experience to enable the department to perform its role. • Reviewed the adequacy and relevance of the scope, compliance and risk based internal audit plan and results of the internal audit procedures with the in-house Internal Audit Department for the Manufacturing Division and the outsourced Internal Auditors for the Corporate, Property Development & Construction and Healthcare Divisions. The focus of review was placed on identified high risk areas. • Reviewed the Internal Audit Reports and relevant issues observed as well as recommendations to remedy identified weaknesses and management responses therefrom. • Reviewed the extent of assistance provided by Management and issues arising from and weaknesses identified during the audit with the Internal Auditors without the presence of Management and Executive Directors. (iv) Risk Management • Reviewed the significant risks identified by the Risk Management Committee on quarterly basis and relevant measures and efforts undertaken to mitigate the risks. • Reviewed and recommended the Risk Management Framework of the Group for the Board’s approval. • Reviewed the assessment report on the effectiveness of the risk and internal control processes of the Group and of the Company and was satisfied that the Group has in place the relevant risk management processes and internal control systems, amongst others, to manage the risks associated with the business and operations of the Group. (v) Related Party Transactions • Reviewed related party transactions and/or recurrent related party transactions involving the Group to ensure that the transactions entered into were at arm’s length basis and on normal commercial terms, which are not more favourable to the related parties than those generally available to the public and are not detriment to the minority shareholders, and made the relevant statement in the circular to shareholders in connection therewith. (vi) Others • Reviewed the Statement on Risk Management and Internal Control and the Report of the Audit and Risk Management Committee for inclusion in the Annual Report. • Reviewed and updated the Terms of Reference of the Audit and Risk Management Committee to ensure its adequacy for current circumstances, the Company’s policies and/or compliance with applicable rules and regulations.