Yinson Annual Report 2019

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 full detailed report on the Audit Committee’s composition, summary of terms of reference and summary of work performed during the financial year under review is contained on pages 96 to 97 of the 2019 Annual Report. The terms of reference of the Audit Committee revised in January 2018 has incorporated a requirement that a former key audit partner is to observe a cooling-off period of at least two (2) years before being appointed as a member of the Audit Committee. Currently, none of the members of the Audit Committee are former key audit partners of the Company. The Audit Committee has the duty and responsibility to review, assess and monitor the performance, suitability and independence of external auditors annually in accordance with the requirements set out in the External Auditors Policy and Procedure adopted by the Board in January 2018, to ensure continuing independence and objectivity of the External Auditors. The External Auditors Policy and Procedure is available on the Company’s website at www.yinson.com . During the financial year under review, the Audit Committee had conducted three (3) private sessions in March, September and December 2018 with the external auditors, PricewaterhouseCoopers PLT without the presence of Executive Directors andManagement. The Audit Committee has obtained assurance from the external auditor confirming its independence. The Board has on 6 May 2019 recommended the re-appointment of PricewaterhouseCoopers PLT for Shareholders’ approval at the forthcoming 26 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. The Company has in November 2017 streamlined its Enterprise Risk Management framework and risk identification process to govern its risk management which 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 on pages 91 to 95 of the 2019 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. Intended Outcome 10.0 Companies have an effective governance, risk management and internal control framework and stakeholders are able to assess the effectiveness of such a framework. The Internal Audit function of the Group is carried out through a co-sourcing engagement by both the inhouse Internal Audit Department and Ernst & Young Advisory Services Sdn Bhd, who report directly to the Audit Committee. The scope of work for the Internal Audit function is set out in the Report on Audit Committee as contained on page 98 of the 2019 Annual Report. The Audit Committee conducted a review on the performance of the Internal Audit function for the financial year ended 31 January 2019 and noted the need for the inhouse Internal Audit team to undertake specialised training from time-to-time to meet the enlarged scope of the Internal Audit function. 87 Yinson Group Overview Strategy and Sustainability Governance Accountability Annual General Meeting