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SHAREHOLDERS

REGULATORS

STAKEHOLDERS

(Laws, regulations,
standards)

BOARD OF DIRECTORS
(AUDIT COMMITTEE)

MANAGEMENT
(Executives operationalise
policies, strategies and
Direction and control
core functions)

Accountabi
lity

BOARD OF DIRECTORS

REGULATORS

AUDIT COMMITTEE

(Laws, regulations,
standards)
SHAREHOLDERS
STAKEHOLDERS

MANAGEMENT

INTERNAL AUDIT

EXTERNAL AUDITOR

Ultimately, the players should ensure the


company is able to have the right balance
between conformance and performance

Good governance depends on effective


interrelationship between Board and
management. Effective Board is a board
which able to establish good leadership,
stewardship and control.

Board of Directors

Audit Committee

Company Secretary

Managing Director

Department

Department

Department

Department

Extracted from prospectus Tijari Resources Bhd

Board of Directors

Audit Committee

Company
Secretary

Internal Audit
Control
assessment
Review process
Reporting

External
Auditors

Risk
manageme
nt
Committee
Risk identification
and assessment
Risk mitigation

(CONT)

Composition Members of Audit


Committee Members

Terms of Reference of Audit


Committee
(Extracted from annual report of
LION Group)

Terms of Reference of Audit


Committee
(ExtractedAUTHORITY/PO
from annual report of
LION Group)
WER

In conducting its duties and responsibilities, the Audit


Committee shall have:
1. the

authority to investigate any matter within its terms


of reference. It is authorized to seek any information it
requires from any employee and all employees are
directed to cooperate with any request made by the
Committee.
2. the resources which are required to perform its duties.
3. full and unrestricted access to any information
pertaining to the Company and the Group.
4. direct communication channels with the external and
internal auditors.
5. the right to obtain independent professional or other
advice as necessary.
6. the right to invite other Directors and/or management
of the Company to attend any particular Audit

Terms of Reference of Audit


Committee
(Extracted from annual report of
LION Group)

Terms of Reference of Audit


Committee
(Extracted from annual report of
LION Group)

Terms of Reference of Audit


Committee
(Extracted from annual report of
LION Group)

Terms of Reference of Audit


Committee
(Extracted from annual report of
LION Group)

Drawbacks of an audit committee

END OF TOPIC 5

TYPES OF DIRECTORS (Additional


Notes)
The
Are normally non
Malaysia
Institute of
executive and
WHAT
Corporate
considered
DEFINITI
Governance
?
outsider and
ON
(MICG)
appointed to sit
define,
INDEPENDEN
on BOD of a
One who
T DIRECTOR
company.
has the
Help identify
knowledge,
the right strategy
integrity
that will improve
and vision
shareholders
combined
value;
with
Balance up
Appointed for a
personality,
Board structure,
specific term and
skill and
give independent
subject to
experience
view
and
DUTIES
retirement by
There to
should
fulfillbe
his
judgment
in
the
rotation and rerole
sufficient number
Board decision
election.
effectively.
of independent
making process;
As a
director on the
They may appoint
watchdog
Board to create a
an
particularly to
suitable balance
alternate/substitu
minority
of power.
te director.

TYPES OF DIRECTORS (Additional


Notes)

ADDITIONAL
NOTES

CORPORATE GOVERNANCE

ENFORCEMENT OF
THE CODE:
Under the Listing Requirements of Bursa
Malaysia, listed entities are required to include
in their annual report:

How the Principles of Corporate Governance


(PART 1) have been applied

The Extent to which the entity has complied


with the best Practice of Corporate
Governance (PART 2).

Example Disclosure (EON 2006).

EXAMPLE QUESTIONS

CORPORATE GOVERNANCE

State and briefly discuss the main role of audit committee to ensure
effective corporate governance.

As an external auditor, what are your contributions towards an effective


corporate governance?

Explains the drawbacks of having an audit committee.