BOARD AUDIT AND RISK COMMITTEE REPORT SUMMARY OF WORK CARRIED OUT DURING THE FINANCIAL YEAR (CONT’D) RISK MANAGEMENT AND INTERNAL CONTROL (a) Reviewed quarterly top risk profiles which covers Strategic, Finance, Operational and Compliance Risks and deliberated on the significant threats and opportunities, including status and adequacy of mitigation strategies. (b) Discussed the improvements to the Enterprise Risk Management Policy & Framework and process to ensure proactive and holistic risk identification, and monitoring of mitigation actions to reduce risk impact to an acceptable level. (c) Reviewed the status of the planned mitigation actions developed from the results of the Compliance risk assessment performed in 2022. (d) Evaluated the overall adequacy and effectiveness of internal controls through review of the work performed by both internal and external auditors, other assurance providers and through discussions with Management. (e) Ensures appropriate controls are in place in management of the Fund, that the Manager has a well defined organisational structure with clear lines of responsibility and a comprehensive reporting system and adequate procedures in financial reporting, risk management, internal control and are in place. Further details in respect of risk management and internal controls are set out on pages 117 to 125 (SORMIC of this Annual Report). Details in respect of the principal risks and uncertainties are set out on pages 42 to 55 under Management Discussion and Analysis. (f) Reviewed and deliberated on four frameworks relating to compliance and internal controls and recommended to the Board the implementation of the frameworks and policies put forward by the Management, listed as below: Frameworks & Policy Date of Meeting Reason for Review 1 Limit of Authority 1 Mar 2022 1 Dec 2022 • Changes in limit of authority in small spending • Mandate delegated to the CEO by the Board 2 Occupational and Safety (OSH) Policy 2 Mar 2022 (new) 3 No-Gift No-Entertainment Policy 2 Mar 2022 (new) 4 Whistleblowing Policy (Revised) 2 Mar 2022 (rev 1) Alignment of policy and procedures to those of the JCorp Group 5 Fixed Asset Policy & Procedure 6 Sep 2022 (new) 6 Internal Control Policy & Procedures Manual 6 Sep 2022 (rev 4) Editorial changes due to the latest issuance of Main Market Listing Requirements, Guidelines to Listed REITs and MCCG 7 DRMSB Procurement Policy 6 Sep 2022 (rev.2) 1 Dec 2022 (rev 3) • Conditions allowed under direct negotiation with respect to awarding of a contract • To incorporate ESG elements in Vendor Assessment/ Evaluation to reflect the changes in the Bursa Sustainability Reporting Guide 8 Fit & Proper Policy 1 Dec 2022 (new) AL-`AQAR HEALTHCARE REIT ANNUAL REPORT 2022 106
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