41 www.excelforce.com.my RISK MANAGEMENT (CONT’D) The management has embedded the responsibilities to manage the risk and internal controls that are associated with the operations of the Group and to ensure compliance with the applicable laws and regulations. Any significant issues and control implemented were discussed at management meetings and quarterly Audit Committee meetings. INTERNAL AUDIT FUNCTIONS In accordance with the Malaysian Code on Corporate Governance, the Group in its efforts to provide an adequate and effective internal control system had appointed Sterling Business Alignment Consulting Sdn Bhd (“Sterling”), an independent consulting firm to review the adequacy and integrity of its system of internal control. Sterling acts as the internal auditors and reports directly to the Audit Committee on the quarterly basis. Sterling reviews and addresses critical business processes, identifies risks associated with the internal control gaps, assesses the effectiveness and adequacy of the existing state of internal control of the Group and recommends possible improvements to the internal control process. This is to provide reasonable assurance that such systems continue to operate satisfactorily and effectively within the Group. The Internal Auditors use the Committee of Sponsoring Organizations of the Treadway Commission (COSO) Internal Control – Integrated Framework as a basis for evaluating the effectiveness of the internal control systems. Each quarterly audit is engaged by approximately 2 to 4 audit personnel depending on the areas of the audit. Quarterly audit reports and status reports on follow-up actions were tabled to the Audit Committee and Board during its quarterly Audit Committee Meetings. The Internal Auditors are free from any relationships or conflicts of interest, which could impair their objectivity and independence of the internal audit function. The Internal Auditors do not have any direct operational responsibility or authority over any of the activities audited. The Audit Committee is of the opinion that the internal audit function is effective and able to function independently. For the financial year ended 30 June 2024, four (4) internal audit reviews had been carried out by Internal Auditors: - Audit Period Reporting Month Name of Entity Audited Audited Areas July 2023 - September 2023 November 2023 Excel Force MSC Berhad • Quality Assurance and System Design. October 2023 - December 2023 February 2024 Excel Force MSC Berhad • Corporate Governance (CG) and Anti-Bribery Management System (ABMS) review. January 2024 - March 2024 May 2024 Excel Force MSC Berhad • Finance and Accounts and Procurement. April 2024 - June 2024 August 2024 Excel Force MSC Berhad • Research and Development. Follow-up status reviews were also carried out to ensure weaknesses identified have been or are being addressed. During the financial year under review, Sterling presented their follow-up status reports on previously reported audited findings in respect of the following functional scopes of the Group: Reporting Month Name of Entity Functional Scopes November 2023 Excel Force MSC Berhad • Management Information Services reported in February 2023. February 2024 Excel Force MSC Berhad • Management Information Services reported in February 2023. • Quality Assurance and System Design reported in November 2023. May 2024 Excel Force MSC Berhad • CG and ABMS reported in February 2024. August 2024 Excel Force MSC Berhad • CG and ABMS reported in February 2024. • Finance and Accounts and Procurement reported in May 2024. Based on the internal audit reviews conducted, none of the weaknesses noted have resulted in material losses, contingencies, or uncertainties that would require separate disclosure in this Annual Report. Statement on Risk Management and Internal Control (cont’d)
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