Group Overview Financials Other information Sustainability and Governance Operation and Financial Review Indofood Agri Resources Ltd. 48 CORPORATE GOVERNANCE The terms of reference for the AC & RMC are as follows: • Review the audit plan, internal accounting controls, audit report, management letter and the Management’s response to the external auditor; • Review the half-year and annual financial statements, paying special attention to changes in accounting policies and practices, major risk areas, and rectifications arising from the audit, before submitting the financial reports to the Board for approval; • Review the going concern statement, compliance with applicable accounting standards, and requirements by the SGX, statutes and laws; • Review the effectiveness and adequacy of the Group’s internal controls, including financial, operational, compliance and information technology, and the ERM framework; • Review the assurance from the CEO and the CFO on the financial records and financial statements; • Review, together with the external auditor, any suspected frauds, irregularities and infringements of Singapore laws, regulations and the SGX-ST Listing Manual that would likely have a material impact on the Group’s operating results or financial position, and the mitigating measures recommended by the Management; • Review, without the presence of the Management, on the level of assistance the Management has provided to the external auditor, and the adequacy of the resolutions to issues arising from the audits; • Review Interested Person Transactions (“IPT”); • Review the effectiveness of the whistle-blowing system as a confidential channel for employees to report potential improprieties in financial management and other areas; • Review the ERM reports; • Review the adequacy, effectiveness, independence, scope and results of the external and internal audits; • Undertake additional reviews and projects as required by the Board, and to report the findings and recommendations to the Board in a timely manner; and • Undertake additional functions and duties as required by the Singapore laws and the SGX-ST Listing Manual. Audit Activities Performed in 2024 The AC & RMC met six times during the year and carried out its duties according to the terms of reference. It also met with the internal auditors and the external auditor separately, without the Management present. The AC & RMC reviewed the financial statements before they were submitted to the Board for approval. It also monitored and reviewed the Company’s financial status, internal and external audit findings, effectiveness of the accounting and internal control systems, and findings of all the whistle-blowing cases investigated and followed-up by the IAD. The Company obtained the shareholders’ approval in the Addendum dated 8 April 2024 to enter into IPTs with individuals within the approved categories of Interested Persons, according to the review procedures set out in the Addendum. The IPT Mandate was last approved by the shareholders at the 2024 AGM. The list of IPTs is disclosed on page 167 of this Annual Report. Except for the disclosure of the IPT on page 167 and in the financial statements for 2024, the Company and its subsidiaries did not enter into any material contracts involving the interests of any Director, the CEO, or controlling shareholder during or at the end of 2024. The AC & RMC did not engage an independent financial adviser for the renewal of the IPT Mandate as the guidelines, methods and review procedures to determine the transaction prices of IPTs had remained unchanged since the last shareholders’ approval of the IPT Mandate at the 2024 AGM, and the review procedures were deemed sufficient to ensure the IPTs were carried out on fair commercial terms and without prejudice to the interest of the Company or minority shareholders. The AC & RMC also reviewed the list of IPTs based on the works performed by the IAD and was satisfied the IPTs were carried out on fair commercial terms. Additionally, the AC & RMC members visited the oil palm plantations and mills, and refinery plants in East Kalimantan and North Sumatra during the year. External Audit The Board will recommend the appointment of a new external auditor or the re-appointment of the incumbent external auditor to the shareholders for approval at the AGM. In the case of the re-appointment of the incumbent external auditor, the AC & RMC will assess the performance of the external auditor based on a combination of inputs, including ACRA’s Audit Quality Indicators Disclosure Framework, feedback from the Management, and the objectivity and conduct of the external auditor during the audit process. If the performance of the external auditor is found to be satisfactory, the AC & RMC will recommend to the Board for the external auditor to be reappointed.
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