Yinson Annual Report 2018

PRINCIPLE B : EFFECTIVE AUDIT AND RISK MANAGEMENT Part I – Audit Committee Intended Outcome 8.0 There is an effective and independent Audit Committee. The board is able to objectively review the Audit Committee’s findings and recommendations. The company’s financial statement is a reliable source of information. The Audit and Risk Management Committee was renamed as Audit Committee after the Board approved the segregation of the risk management function to Board Risk Management Committee in January 2018. The detailed report on the Audit Committee’s composition, terms of reference, summary of work performed during the financial year under review, is contained in page 82 to 84 of the 2018 Annual Report. The terms of reference of the Audit Committee had been reviewed and revised in January 2018 of which an additional requirement for a former key audit partner to observe a cooling-off period of at least two (2) year before being appointed as a member of the Audit Committee was included. Currently, none of the members of the Audit Committee is a former key audit partner of the Company. The Audit Committee within its responsibility to review, assess and monitor the performance, suitability and independence of External Auditors. The Board had adopted External Auditor Policy and Procedure in January 2018, which sets out the selection and appointment, annual assessment and re-appointment, removal and no re-appointment, audit engagement independence, audit deliverables, rotation of audit partners and non-audit services. During the financial year under review, the Audit Committee had conducted three (3) private sessions with external auditors, PricewaterhouseCoopers PLT (formerly known as PricewaterhouseCoopers) in March, September and December 2017, without the presence of Executive Directors and Management. The Audit Committee has obtained assurance from the external auditor confirming its independence. On 3 May 2018, the Board has recommended the re-appointment of PricewaterhouseCoopers PLT for Shareholders’ approval at the forthcoming 25 th AGM. Part II – Risk Management and Internal Control Framework Intended Outcome 9.0 Companies make informed decisions about the level of risk they want to take and implement necessary controls to pursue their objectives. The board is provided with reasonable assurance that adverse impact arising from a foreseeable future event or situation on the company’s objectives is mitigated and managed. As part of the Board’s objective to improve the good governance of the Group, the Board has segregated the risk management function fromtheAudit Committee formore focused role in the direction and oversight of theGroup’s riskmanagement framework and policies. The Enterprise Risk Management framework and risk identification process to manage its risk management is in line with the IS0 31000 Risk Management guidelines. A detailed report of the risk management and internal control framework are set out in the Statement on Risk Management and Internal Control contained in page 76 to 81 of the 2018 Annual Report. The Board is of the view that the system of internal control and risk management is sound and adequate to mitigate risk exposure of the business and safeguard the interest of the Shareholders, employees, regulators and other stakeholders. Governance Corporate Governance Overview Statement (Cont’d) 72 Yinson Holdings Berhad Annual Report 2018