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Terms of Reference - Audit Committee


TASCO BERHAD (20218-T)
(Incorporated in Malaysia)

AUDIT COMMITTEE

TERMS OF REFERENCE

Primary Purposes


The Audit Committee ("Committee") shall:
1.   Provide assistance to the Board in fulfilling its fiduciary responsibilities relating to the corporate
      accounting and practices for the Group.
2.   Improve the Group's business efficiency, the quality of the accounting function, the system of
      internal controls and audit function and strengthen the confidence of the public in the Group's
      reported results.
3.   Maintain through regularly scheduled meetings, a direct line of communication between the Board
      and the external auditors as well as internal auditors.
4.   Enhance the independence of both the external and internal auditors functions through active
      participation in the audit process.
5.   Strengthen the role of the independent directors by giving them a greater depth of knowledge as
      to the operations of the Group through their participation in the Audit Committee.
6.   Act upon the Board’s request to investigate and report on any issues or concerns with regard to
      the management of the Group.

Members

The Board shall appoint the members of the Audit Committee from amongst themselves, which fulfils
the following requirements: -
1.   The Audit Committee shall be composed of at least three (3) members;
2.   The majority of the Audit Committee must be independent directors;
3.   The Chairman of the Audit Committee shall be an independent director;
4.   All members of the Audit Committee should be non-executive directors;
5.   All members of the Audit Committee should be financially literate and at least one of the
      members of the Committee must:-
      (i)   be a member of the Malaysian Institute of Accountants; or
      (ii)  have at least three (3) years working experience and;
            •   Must have passed the examinations specified in Part I of the 1st Schedule
                of the Accountants Act, 1967, or
            •   Must be a member of one of the associations of accountants specified in Part II
                of the 1st Schedule of the Accountants Act, 1967.
      (iii) fulfil such other requirements as prescribed by the Bursa Malaysia Securities Berhad; and
6.   No alternate director is appointed as a member of the Audit Committee.

Authority

The Audit Committee shall be in accordance with the procedure determined by the Board and at the
cost of the Group:-
a.   have explicit authority to investigate any matter within its terms of reference;
b.   have the resources which are required to perform its duties;
c.   have full and unrestricted access to any information pertaining to the Group;
d.   have direct communication channels with the external auditors and person(s) carrying out
      the internal audit function;
e.   be able to obtain independent/external professional or other advice and to secure the attendance
      of outsiders with relevant experience and expertise if it considers this necessary; and
f.    be able to convene meetings with the external auditors, the internal auditors or both excluding
      the attendance of other directors and employees of the Company, whenever deemed necessary.

Functions and Duties

The functions of the Audit Committee are as follows:-

1.   To do the following, in relation to the internal audit function:-
      a.   review the adequacy of the scope, functions, competency and resources of the internal audit
            functions and that it has the necessary authority to carry out its work;
      b.   review the internal audit programme and results of the internal audit process or
            investigation undertaken and whether or not appropriate actions are taken on the
            recommendations of the internal audit function;
      c.   review any appraisal or assessment of the performance of members of the internal audit
            function;
      d.   approve any appointment or termination of senior staff members of the internal audit
            function; and
      e.   take cognisance of resignation of internal audit staff members and provide the resigning staff
            member an opportunity to submit his reasons for resigning.

2.   To do the following, in relation to the external audit function:-
      a.   consider the appointment of the external auditors, the audit fee and any questions of
            resignation or dismissal and on whether there is reason (supported by grounds) to believe that
            the Company’s external auditors is not suitable for re-appointment;
      b.   discuss with the external auditors before the audit commences, the nature and scope of the
            audit, and ensure co-ordination where more than one audit firm is involved;
      c.   review the quarterly results and year end financial statements, prior to the approval by the
            Board, focusing particularly on:-
            (i)    any changes in or implementation of major accounting policy and practices;
            (ii)   significant adjustments arising from the audit;
            (iii)  significant matters highlighted including financial reporting issues, significant
                   judgements made by management, significant and unusual events or
                   transactions, and how these matters are addressed;
            (iv)  the going concern assumption; and
            (v)  compliance with accounting standards and other legal requirements.
      d.   review any management letter sent by the external auditors to the Company and the
            management’s response to such letter;
      e.   discuss problems and reservations arising from the interim and final audits, and any
            matter the auditors may wish to discuss (in the absence of management where
            necessary);
      f.    review the adequacy of existing external auditors audit arrangements, with particular
            emphasis on the scope and quality of the audit;
      g.   review the external auditors’ audit report;
      h.   review the assistance given by the employees of the Group to the external auditors;
      i.    review all areas of significant financial risk and the arrangements in place to contain
            those risks to acceptable levels.

3.   To consider any related party transactions and potential conflict of interests situations that may
      arise within the Company and the Group.
4.   To consider the major findings of internal investigations and management response.
5.   To meet with the external auditors without executive board members present at least twice a year.
6.   To carry out any other function that may be mutually agreed upon by the Committee and
      the Board, which would be beneficial to the Group and ensure the effectiveness discharge of the
      Committee's duties and responsibilities.
7.   To review and verify the allocation of share options to eligible persons as being in compliance
      with the by-laws approved by the Board of Directors and shareholders of the Company.
8.   The Audit Committee actions shall be reported to the Board of Directors with such
      recommendations as the Audit Committee deemed appropriate.
9.   To report to Bursa Malaysia Securities Berhad on any matter reported by it to the Board which has
      not been satisfactorily resolved resulting in a breach of the Listing Requirements of Bursa Malaysia
      Securities Berhad.

Retirement and Resignation

In the event of any vacancy in the Audit Committee, the Company shall fill in the vacancy within
two (2) months, but in any case not later than three (3) months.

Meetings

1.   The Audit Committee shall meet at least four (4) times in a year or more frequently
      as circumstances required with due notice of issues to be discussed and shall record its
      conclusions in discharging its duties and responsibilities.
2.   The quorum of the meeting is two (2) and they must be Independent Directors.
3.   Upon the request of any member of the Audit Committee, the external auditors or the internal
      auditors, the Chairman of the Audit Committee shall convene a meeting of the Audit Committee
      to consider matters which should be brought to the attention of the directors or shareholders.
4.   The external auditors and internal auditors have the right to appear and be heard at any meeting
      of the Audit Committee and shall appear before the Audit Committee when required to do so
      by the Audit Committee.
5.   The Audit Committee may invite any Directors or any member of management or any employee
      of the Group who the Audit Committee thinks fit to attend its meetings to assist and to provide
      pertinent information as necessary.
6.   The Company must ensure that other Directors and employees attend any particular Audit
      Committee meeting only at the Audit Committee’s invitation, specific to the relevant meeting.

Procedures of Audit Committee

The Audit Committee may regulate its own procedures, in particular:-

a.   the calling of meetings;
b.   the notice to be given of such meetings;
c.   the voting and proceedings of such meetings;
d.   the keeping of minutes;
e.   the custody, production and inspection of such minutes; and
f.   the terms of office and performance of the Audit Committee and each of its members shall be
     reviewed by the Nominating Committee on annual basis.

Secretary

The Company Secretary or other appropriate senior official shall be the Secretary to the Audit Committee.

 
 
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