FGV Annual Integrated Report 2019

103 ANNUAL INTEGRATED REPORT 2019 04 S E C T I O N AUDIT COMMITTEE REPORT Development of Audit Plan When the Audit Plan is developed, consideration is given from the governance perspective as to how the whole company is managed at the Group level (Corporate Centres) and cascaded down to the Business Cluster and ultimately the operational level. Another consideration is from the risk perspective where high risk issues are prioritised during the development of the Annual Group Internal Audit Plan. Based on these assessments, priority ranking is assigned to each operating unit to arrive at the audit plan over three years. The three-year Audit Plan is reviewed every year and forms the basis to derive the Annual Group Internal Audit Plan. Once the key audit areas are developed, the staff and resource allocation plan, budget estimates and staff development progress are established. The Annual Group Internal Audit Plan is presented to the Audit Committee. The Audit Committee reviews and challenges the adequacy of the audit scope, the resources allocated, the capability skill sets and makes recommendations before approving the Group Internal Audit Plan. Any recommendation of the Audit Committee is taken into the Group Internal Audit Plan. Once the Group Internal Audit Plan is rolled out, the Audit Committee ensures that the coverage is responsive and robust to satisfy the changing level of risk and emerging areas of concern. Any deviation to the Group Internal Audit Plan is discussed and endorsed by the Audit Committee quarterly. For year 2020, the Audit Plan was formulated based on the new audit approach approved by the Audit Committee which resulted in a reduction in the number of internal auditors required. The new audit approach is as follows: a. To increase focus on Group-wide and thematic audit reviews; b. Routine audits will be on a selective basis subject to risk assessment; c. To perform follow-up based on risk assessment and audit report rating; d. To utilise more data analytics in the audit work; and e. To introduce Control Self-Assessment (CSA) as a tool for auditing operations. Internal Audit Reporting All Group Internal Audit reports are issued directly to the Audit Committee with copies to the relevant Management for their action. On a quarterly basis, the Audit Committee is presented with the progress reporting of the audit findings, recommendations and implementation of Management’s corrective actions. Any concerns raised by the Audit Committee are to be addressed by Group Internal Audit. The Audit Committee follows through on any unresolved matters as part of the agenda in the next meeting. Objectivity and Independence of Group Internal Audit The Chief Internal Auditor states Group Internal Audit’s declaration of objectivity and independence to the Audit Committee in its Annual Group Internal Audit Plan. Group Internal Audit undertakes a survey of the relationship of its auditors once every two years and ensures that the rotation of internal auditors does not result in any compromise of objectivity and independence. HOW WE ARE GOVERNED GOVERNANCE AT FGV: ACCOUNTABILITY