128 Kenanga Investment Bank Berhad Annual Report 2021 Our Sustainability Approach About This Report We Are Kenanga Message From Chairman and GMD b. In 2021, the AC had reviewed and deliberated on a total of forty-one (41) internal audit reports in relation to the audits carried out by GIA, together with the audit recommendations made by GIA and Management’s responses to those recommendations. Where appropriate, the AC had directed Management to rectify and improve the control and workflow procedures based on GIA’s recommendations. The AC, at all its quarterly meetings, also reviewed the implementation status of the corrective actions arising from the audit recommendations to ensure that the key risks and control lapses were addressed in a timely manner. With regard to long outstanding audit recommendations, where appropriate, the relevant Heads of Department were invited to the AC meeting to provide relevant explanation for the delay in implementing such audit recommendations. c. In addition to the audit conducted on the processes and systems of Support and Business Units within KIBB Group, during the Financial Year 2021, GIA also conducted various regulated required reviews in areas including amongst others, Anti-Money Laundering/ Counter Financing of Terrorism, Basel II (Pillar 3), Related Party Transactions, Verification of Ringgit Malaysia Marketable Securities, Staff Training Fund, Cyber Security and Business Continuity Plan/ Disaster Recovery Plan Testing. d. The AC at its meeting on 25 January 2021, had taken note of GIA’s Annual Confirmation on Organisational Independence of Internal Audit Activity for the Financial Year 2020 in line with the International Standards for Professional Practice of Internal Auditing (Standards – 1110). e. For the purpose of evaluating the performance of the GCIA, the AC had at its meeting on 25 January 2021, reviewed and deliberated the GCIA’s 2020 Performance Appraisal and the Annual Assessment on Fit and Proper, as well as the 2021 Balanced Scorecard, prior to submission of the same to the Group Governance, Nomination & Compensation Committee (“GNC”) for its further recommendation to the Board of KIBB for approval. The AC’s recommendation was subsequently approved by the Board of KIBB on 27 January 2021. f. The AC, at its meetings on 28 July 2021 had taken note of the Quality Assessment Review (“QAR”) of KIBB’s Internal Audit Function Proposal presented by the Institute of Internal Auditors Malaysia (“IIAM”), following the IIAM’s appointment as approved by the AC at its meeting on 27 April 2021. The QAR was conducted in line with the recommended best practice, to be undertaken once every five (5) years to ascertain as to whether the Internal Audit function of KIBB was in line with international standards relating to internal auditing practices. At its meeting on 27 October 2021, the AC had deliberated on the results of the QAR on GIA together with the key observations and recommendations made by the IIAM arising therefrom. Based on the QAR, the IIAM had concluded that the Internal Audit function of KIBB ‘Generally Conforms’ to the IIAM’s International Standards for the Professional Practice of Internal Auditing, with some areas for improvement especially in refining the work processes and meeting the stakeholders’ expectations. Upon due deliberation, the AC had concurred with GIA’s action plans in implementing the IIAM’s recommendations.
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