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Audit Committee Report

In: Business and Management

Submitted By sfflrm
Words 1169
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Audit Committee Report According to the Malaysian Code on Corporate Governance (MCCG) 2007 (Revised), under the Accountability & Audit, as well as the Bursa Malaysia Listing Requirements, The board should establish an audit committee comprising at least three members, a majority of whom are independent. All members of the audit committee should be non-executive directors. The board should provide the audit committee with written terms of reference which deal clearly with its authority and duties. First off, on the matter of the compliance on the size of the board/committee, all the companies that we reviewed comply with that limit. 2 of the 12 companies were actually surpassed that minimum requirement, where they have 4 members in their Audit Committee. Those companies that we wish to highlight are Kamdar Group Berhad & Key Asic Berhad. This is a good example as the more members there are in an Audit Committee, there more reliable and independent the information involving the financial statements and any other relevant information will be, albeit, the independence of each member would be a factor to consider. Moving on, the question of whether those who are in the Audit Committees are independent or not come in to place. According to the MCCG 2007, the board of Audit Committee must have a majority of who are independent. The point here that we should note is that, all of the members of the Audit Committee should comprise fully of non-executive directors. Going through our 12 companies, we found out that almost all of them achieved the standard of having independence rightfully on their board. The term “almost” is said here as there is one company that did not meet the requirement of 100% members independence. That particular company is Key Asic Berhad whereby, one out of four of their members are a non-independent non-executive director. This company should

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