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Statement on Risk Management
and Internal Control
1.
INTRODUCTION
The Board acknowledges the importance of maintaining a sound system of internal controls to safeguard the interests of
shareholders and other stakeholders. The Board’s Statement on Risk Management and Internal Control is in compliance
with Paragraph 15.26(b) of the Bursa Malaysia Securities Berhad (“Bursa”) Main Market Listing Requirements (“Listing
Requirements”), Principle B of Effective Audit and Risk Management of Malaysian Code on Corporate Governance 2017
(“MCCG”) and the Statement on Risk Management and Internal Control: Guidelines for Directors of Listed Issuers.
2.
RESPONSIBILITY
The Board recognises their responsibility for the Group’s system of internal control, which is designed to identify and
manage the principal risks facing the business in pursuit of its objectives, to review its adequacy and integrity. The Audit
and Risk Committee supports the Board in monitoring the Group’s risk exposures, the design and operating effectiveness
of the underlying risk management and internal control systems. The Management is accountable to the Board for
monitoring the Group’s system of internal control and for providing assurance to the Board that it has done so.
The system of internal control covers risk management, financial, operational, administration, human resource,
information technology and compliance controls to safeguard shareholders’ investments and the Group’s assets. This
system is designed to manage rather than to eliminate the risk of failure to achieve business objectives and can only
provide reasonable but not absolute assurance against material misstatement or loss.
The Board is of the view that the system of internal control and risk management is in place for the year under review,
and up to the date of approval of this Statement on Risk Management and Internal Control, is sound and sufficient to
safeguard the Group’s assets, as well as the shareholders’ investments, and the interest of other stakeholders. The Board
has received assurance from the Group Managing Director (“Group MD”) and the Chief Financial Officer that the Group’s
risk management and internal control system is operating adequately and effectively, in all material aspects, based on the
Group’s risk management and internal control system.
3.
INTERNAL CONTROL
The key processes that the Board has established in reviewing the adequacy and integrity of the system of internal control
and risk management systems include the following:
3.1 Operational and follow-up audits are conducted throughout the financial year based on approved annual audit
plan to provide reasonable assurance that the systems of internal controls and its framework, and governance
processes put in place by Management continue to operate satisfactorily and effectively and to add value and
improve the Group’s business operations.
3.2 A meeting of Heads of Divisions which is chaired by the Group MD is held monthly to deliberate on KFima Group’s
financial performance, internal audit reports, business development, legal/litigation, operational, and corporate
issues. The Group MD will update the Board of any significant matters that require the Board’s immediate attention.
3.3 The Group MD actively participates and involves in the day-to-day running of the major businesses and regular
discussions with the senior management.
3.4 There is a budgeting and forecasting system. Each line of business submits a business plan annually for approval by
the Board. The results of the lines of businesses are reported monthly and variances are analysed against budget
and acted on in timely manner. The Group’s strategic directions are also reviewed annually taking into account
changes in market conditions and significant business risks.
3.5 The periodic and streamlining review of limits of authority and other standard operating procedures within the
Group provides a sound framework of authority and accountability within the organisation and to facilitate quality,
well informed and timely corporate decision making at the appropriate level in the organisation’s hierarchy.
Annual Report 2020
kumpulan Fima Berhad
(197201000167)(11817-V)
106