MISC BERHAD 172 INTEGRATED ANNUAL REPORT 2023 173 www.miscgroup.com GOVERNANCE SECTION 12 Board Audit Committee Report I am privileged to assume the role of Chairman of MISC’s Board Audit Committee (BAC), succeeding the esteemed Dato’ Sekhar Krishnan. The transition period has provided invaluable insights, thanks to the unwavering support of Dato’ Sekhar Krishnan and the collective dedication of the BAC. With a robust foundation in place, I am pleased to present my inaugural report as BAC Chairman. Strong Governance & Internal Controls Beyond routine oversight, the BAC plays a key role in enhancing MISC’s internal controls and corporate governance, with a focus on integrity. In 2023, the BAC strengthened MISC’s governance and internal controls. The Group Internal Audit (GIA) leveraged technology for improved oversight, increasing policy integrity and operational efficiency. We also enhanced the governance framework within the Procurement segment to improve competitiveness. To further strengthen our governance, the BAC revised the Policy on External Auditors in 2023, prohibiting all MISC Group subsidiaries from appointing their statutory auditors for prohibited non-audit services. Furthermore, it now requires external auditors to obtain BAC’s prior approval before offering non-audit services, unless already approved as non-threatening to auditor independence. This enhances the integrity and independence of our audit processes. Navigating Regulatory Changes To maintain a strong culture of compliance amidst a dynamic landscape, the BAC continued to maintain diligent oversight of market changes and regulatory standards. In response to the evolving tax regulations with the introduction of the Global Minimum Tax from 1 January 2025 and the Malaysian Budget 2024 tax proposals, we took proactive measures to ensure we remained in compliance with regulatory shifts. The Year Ahead In 2024, the BAC is ready to address new challenges and opportunities by adapting to evolving disclosure requirements and regulatory changes while sustaining industry leadership. We will continue to provide effective oversight of financial statements and audits and closely monitor internal controls to safeguard MISC’s interests. On behalf of the BAC, I would like to extend our appreciation to Dato’ Sekhar Krishnan, Datuk Nasarudin Md Idris and Dato’ Ab. Halim Mohyiddin for their invaluable contributions to advancing our governance standards. I would also like to take this opportunity to welcome Encik Mohammad Suhaimi Mohd Yasin and Cik Wan Shamilah Wan Muhammad Saidi, who joined the BAC on 15 January 2024. Dear Shareholders, The Board Audit Committee (BAC) was established with the objective of assisting the Board in an oversight role to help ensure effective financial management, financial accounting, internal control systems, whistleblowing policy and management process of the Group. Composition and Meeting Attendance The BAC comprises of three (3) members, majority of whom are Independent Non-Executive Directors (INEDs) of the Company. The current composition of the BAC and qualifications of its members comply with Paragraph 15.09(1) of the Main Market Listing Requirements (MMLR) of Bursa Malaysia Securities Berhad (Bursa Securities) which requires at least one (1) member of the BAC to be a qualified accountant. The composition of the BAC is as follows: Members Date of Appointment as BAC Member CHEW LIONG KIM Chairman Senior Independent Non-Executive Director 1 January 2022 (Re-designated as Chairman on 15 January 2024) MOHAMMAD SUHAIMI MOHD YASIN Member Independent Non-Executive Director 15 January 2024 WAN SHAMILAH WAN MUHAMMAD SAIDI Member Non-Independent Non-Executive Director 15 January 2024 (1) Dato’ Sekhar Krishnan retired as Senior Independent Non-Executive Director of MISC and ceased being a member of the BAC on 15 January 2024. (2) Dato’ Ab. Halim Mohyiddin retired as Independent Non-Executive Director of MISC and ceased being a member of the BAC on 15 January 2024. (3) Datuk Nasarudin Md Idris retired as Independent Non-Executive Director of MISC and ceased being a member of the BAC on 1 September 2023. The BAC Chairman, Chew Liong Kim and Wan Shamilah Wan Muhammad Saidi are qualified accountants. Chew Liong Kim, is a member of the Malaysian Institute of Accountants (MIA) and a Fellow Chartered Accountant (FCA) of the Chartered Accountants Australia and New Zealand. Wan Shamilah Wan Muhammad Saidi is a Fellow of Institute of Chartered Accountants in England & Wales and a member of MIA. The BAC met five (5) times in FY2023. The BAC Chairmen and all BAC members attended all meetings during their tenure in office. The President/Group CEO is invited to attend the BAC meetings to facilitate discussions, as well as to provide explanation on audit issues, financials, internal controls as well as other matters within the BAC’s TOR. The Group Chief Audit Executive, Group Internal Audit (GIA) of PETRONAS or her representative and the Head, GIA of MISC are also invited to the BAC meetings, together with the relevant management personnel, to observe the proceedings and provide clarification on any relevant internal audit reports tabled to the BAC. The external auditors are invited to present their audit plan, audit results and other relevant matters. The BAC meetings for the year under review were pre-scheduled in December 2022 to allow BAC members to plan ahead and incorporate the year’s meetings into their respective schedules. Board Audit Committee Report CHEW LIONG KIM Chairman Board Audit Committee
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