FGV Annual Report 2017

ANNUAL INTEGRATED REPORT 2017 HOW WE ARE GOVERNED 89 GOVERNANCE AT FGV: ACCOUNTABILITY Professional status Percentage of total Auditors Professional accounting (ICAEW, CPA, ACCA, CA) or Certified Internal Auditor (CIA) or post- graduate (MBA or Masters) 18 Certified IS Auditor (CISA) 6 Graduate (Bachelor’s Degree) 52 Graduate pursuing professional accounting (ICAEW, CPA, ACCA, CA) or CIA 21 Others (Diploma) 3 Total 100 GROUP INTERNAL AUDIT The Group has an in-house Group Internal Audit (GIA) function, which is independent and reports functionally direct to the Audit Committee and administratively to the GP/CEO. The conduct of GIA is based on a Group Internal Audit Charter, which is established consistent with the requirements of the Institute of Internal Auditors' International Professional Practices Framework and approved by the Audit Committee as affirmed through a Quality Assurance Review conducted by the Institute of Internal Auditors Malaysia in 2014. There are a total of 64 internal auditors as at 31 December 2017 covering the activities of the Group headed by Zalily Mohamed Zaman Khan, the Chief Internal Auditor. The credential of the Chief Internal Auditor can be obtained at page 79 of this Annual Integrated Report 2017. The internal auditors have sufficient mix of knowledge, skills and competencies to execute the audit plan. Composition of the internal auditors and the corresponding professional status are as follows: The above includes 17 internal auditors (26%) who are members of the Institute of Internal Auditors Malaysia. The total cost incurred for GIA for the FYE 2017 is RM11.2 million (FYE 2016: RM9.9 million). This amount comprises of mainly staff cost and benefits, travelling expenses and GIA management system. Roles and functions GIA provides assurance services of the Group locally and overseas covering all operations where the Group has management control and where partners consent for jointly controlled entities. In addition to the assurance role, GIA also undertakes consulting role and investigative role. In its consulting role, GIA undertakes advisory on governance, risk and control, policy and procedures review, participate in working groups to provide input on policy development, systems development and several initiatives of the Group. Investigative audits are undertaken upon any allegation of improper, illegal and dishonest acts based on the request of the Management or Board. 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 years audit plan is reviewed every year and forms the basis to derive the Annual GIA Plan. Once the key audit areas are developed, the staff and resource allocation plan, budget estimates and staff development progress are established to support the GIA. 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 GIA Plan. Any recommendation of the Audit Committee is taken into the GIA Plan. Once the GIA 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 GIA Plan is discussed and endorsed by the Audit Committee quarterly. Internal Audit Reporting All GIA 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 management’s corrective action implementation. Any concerns raised by the Audit Committee are to be addressed by GIA. The Audit Committee follows through any unresolved matters as part of the agenda in the next meeting.