DOMINANT ENTERPRISE BERHAD
TERMS OF REFERENCE
1. Composition of Members
Han Hing Siew
Independent Non-Executive Director
Tan Ying Beng
Independent Non-Executive Director
Noor Hazelin Binti Hashim
Independent Non Executive Director
Mr Johnson Kandasamy A/L David Nagappan
Non Independent Non Executive Director
a. The Audit Committee (referred to as “the Committee” or “AC”) shall be appointed by the Board from among their members and shall consist of not less than three (3) members. All the AC members must be Non-Executive Directors with a majority of whom are Independent Directors and all the members should be financially literate with at least one of the members of the AC:
- must be a member of the Malaysian Institute of Accountants (“MIA”); or
- if he/she is not a member of the MIA, he/she must have at least three (3) years’ working experience and;
(aa) he/she must have passed the examinations specified in Part 1 of the 1st Schedule of the Accountants Act 1967; or
(bb) he/she must be a member of one of the associations of accountants specified in Part II of the 1st Schedule of the Accountants Act, 1967; or
- he/she must fulfill such other requirements as prescribed or approved by Bursa Securities.
- Alternate Directors shall not be eligible for appointment as a member of the Committee.
- The members of the AC must elect a Chairman among themselves who is an Independent and Non-Executive Director and the Chairman of the Board must not be a member of AC.
- The Nomination Committee shall review the term of office and performance of the AC and each of its members annually to determine whether the AC and its members have carried out their duties in accordance with the AC’s Terms of Reference.
- Where the membership of the Committee falls below three (3) due to retirement or resignation or any other reason, the vacancy must be filled within three (3) months.
- A former partner of the external audit firm and/or the affiliate firm (including those providing advisory services, tax consulting etc) of the Company or any entity within the Group is required to observe a cooling-off period of at least three (3) years before being appointed as a member of the Committee.
- All members of the Committee should be financially literate and have sufficient understanding of the Group’s business and must be able to read, analyse, interpret and understand financial statements, and ask pertinent questions about the Group’s reporting process.
The Committee is authorised by the Board, in accordance with the procedures to be determined by the Board and at the cost of the Company, to :
(a) Investigate any activity within the Committee’s terms of reference;
(b) Have resources which are reasonably required to enable it to perform its duties;
(c) Have full and unrestricted access to any information pertaining to the Company or the Group;
(d) Have direct communication channels with the external auditors and person(s) carrying out the internal audit functions or activities;
(e) Obtain outside legal or other independent professional advice and secure the attendance of outsiders with relevant experience and expertise if it considers this necessary; and
(f) 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 at least twice a year.
The duties of the Committee shall be to review the following and report the same to the Board:
(a) Any matters concerning the appointment and dismissal of the external auditor and the fixing of the audit fees and the disclosure of non-audit fees;
(b) The nature and scope of the audit by the external auditors before commencement;
(c) The external auditors’ audit report, areas of concern arising from the audit and any other matters the external auditors may wish to discuss (in the absence of management) ;
(d) Any financial information for publication, including quarterly and annual financial statements, before submission to the Board, focusing particularly on;
- Changes in implementation of major accounting policy;
- Significant and unusual events; and
- Compliance with accounting standards and legal requirements;
(e) The external auditor’s management letter and management’s responses;
(f) The adequacy of the competency and relevance of the scope, functions and resources of internal audit and the necessary authority to carry out its work;
(g) The audit plan and work programme of internal audit;
(h) Findings of internal audit works and management’s responses;
(i) Any evaluations on risk management and internal controls by auditors;
(j) Extent of cooperation and assistance given by the employees;
(k) The propriety of any related party transaction and conflict of interest situations that may arise within the Company or the Group;
(I) to observe a cooling-off period of at least 3 years for a former key audit partner prior to the appointment as a member of Audit Committee; and
(m) Any other matter as directed by the Board.
4. Overseeing the Internal Audit Function
(a) The Committee shall oversee all internal audit functions and is authorised to commission investigations to be conducted by internal audit as it deems fit;
(b) The internal auditor shall report directly to the Committee and shall have direct access to the Chairman of the Committee; and
(c) All proposals by management regarding the appointment, transfer or dismissal of the internal auditor shall require the prior approval of the Committee.
5. Quorum for meetings
The quorum shall be formed only if there is a majority of members present at the meeting who are independent directors
6. Attendance at meetings
(a) The Managing Director, Deputy Managing Director, Chairman of the Company, Accounts Manager and Chief Operations Officer, maybe invited attend meetings as and when deemed necessary by the Committee;
(b) Company Secretary and the Head of Internal Audit shall normally attend meetings as and when deemed necessary by the Committee;
(c) A Representative of the external auditor shall attend the meeting to consider the final audited financial statement and such other meetings as determined by the Committee;
(d) Non-member directors shall not attend unless specifically invited to by the Committee.
7. Frequency of Meetings
The Chairman shall call for meetings, to be held not less than four times a year. The external auditors may request a meeting if they consider one necessary
8. Reporting Procedures
(a) The Company Secretary shall be the Secretary of the Committee, who shall record attendance of all members and invitees and take minutes to record the proceedings of every meeting of the Committee. All minutes of meetings shall be circulated to every member of the Board;
(b) The Committee shall prepare an annual report to the Board that provides a summary of the activities of the Committee for inclusion in the Company’s annual report;
(c) The Committee shall assist the Board in preparing the following for publication in the Company’s annual report :
(i) Statement on the Company’s application of the principles set out in the Malaysian Code of Corporate Governance 2012 to its particular circumstances, having regard to the recommendations stated under each principle;
(ii) Any recommendations which the Company has not followed, together with the reasons for not following it and the alternatives adopted by the Company, if any.
(iii) Statement on the Board’s responsibility for preparing the annual audited financial statements; and
(iv) Statement about the state of risk management and internal control of the Group.
(v) Statement on Internal Audit function to disclose whether the Internal Audit function is performed in-house or outsourced and the cost incurred for the Internal Audit function in respect of the financial year.
(d) The Committee may report any breaches of the Listing Requirements, which have not been satisfactorily resolved, to the Bursa Malaysia Securities Berhad.
9. Review of the Written Terms of Reference
Any amendments to this Terms of Reference to be approved by the Board. This Terms of Reference will be reviewed and updated periodically in accordance with the needs of the Company and any new regulations that may have an impact on the discharge of the Committee's responsibilities.
The written Terms of Reference will be published on the Company's website.
Updated and approved by AC and the Board on 31 May 2022 and is available on the Company's website, at www.dominant.com.my.