KENANGA ANNUAL REPORT 2018

68 KENANGA INVESTMENT BANK BERHAD b. The subsequent quarterly financial statements for the quarters ended 31 March 2018, 30 June 2018 and 30 September 2018 were tabled and reviewed by the AC at its quarterly meetings held on 19 April 2018, 23 July 2018 and 26 October 2018 respectively, upon which the AC had recommended the quarterly financial statements to the Board for approval. c. The AC had, at its meeting held on 26 October 2018, recommended the annual assessment for impairment of assets for the Financial Year Ending 31 December 2018 based on the impairment approach and assumptions used for Kenanga Investment Bank Berhad and its Group of Companies (“ Kenanga Group ” or “ the Group ”), subject to the final assessment to be done for the financial results as at 31 December 2018, for the Board’s adoption. The AC’s recommendation was subsequently approved by the Board on 31 October 2018. d. With regard to the implementation of the Malaysian Financial Reporting Standard (“ MFRS ”) 9 - Financial Instruments, the AC was updated at its quarterly meetings on 25 January 2018 and 19 April 2018, on the status of the Company’s implementation of MFRS 9. e. At each of its quarterly meeting, the AC was also notified of the amount of non- audit fees incurred and paid to the External Auditors and their affiliate by the Group to ensure compliance with the Group’s Policy on Non-Audit Services by External Auditors. f. With regard to the implementation of new accounting standard, MFRS 15 – Revenue from Contracts with Customer, which came into effect on 1 January 2018 and MFRS 16 – Leases Accounting to be effective on 1 January 2019, the AC was updated on its applicability and impact on the financial statements of the Group. g. The AC had, at its meeting held on 27 February 2018, deliberated on the analysis of the performance/ profitability of each of the subsidiary company and associate company of the Group for the last five (5) years. h. The AC had, at its meeting held on 19 April 2018, recommended the newly established Accounting Policy for Employees’ Share Scheme of the Group, for the Board’s adoption. 3.2 External Audit a. The report by the External Auditors on the statutory audit of the financial statements of the Company for the Financial Year Ended 31 December 2017 was reviewed and deliberated by the AC at its meeting held on 25 January 2018. During its deliberation, in addition to the relevant disclosures in the audited financial statements, the AC had also considered the recommendations made by the External Auditors towards enhancing internal controls and procedures. b. The AC had also at the same meeting reviewed the list of services provided by the External Auditors during the financial year comprising audit and regulatory- related services; issuance of a written communication to Management and the AC describing significant deficiencies and material weaknesses identified during the External Auditors’ audit, including recommendations for improvements in controls and procedures. In addition, the External Auditors’ services also included the annual review of the Statement on Risk Management and Internal Control, as well as other regulatory submission as required under the various regulatory requirements. c. At its meeting on 27 February 2018, the AC was subsequently updated by the External Auditors on the latest status of the statutory audits conducted on the Group and in relation thereof, audit matters which required the AC’s attention, had been dealt with accordingly. AUDIT COMMITTEE REPORT