Annual Report 2012 - e-KONG Group Limited

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Audit CommitteeThe Audit Committee was established on 29 September 1999 by the Board and comprises three Board members, all ofwhom are independent non-executive directors. A set of written terms of reference, which describes the authority andduties of the committee as well as proceedings of its meetings, is based on the recommendations as set out in “A GuideFor Effective Audit Committees” published by the Hong Kong Institute of Certified Public Accountants in February 2002.These terms of reference were adopted by the Board in the past and subsequently revised in accordance with both theFormer Corporate Governance Code and the Corporate Governance Code, which terms of reference are incorporatedin the written corporate policies of the Company. The terms of reference and related written corporate policies of theCompany are under regular review by the committee and the Board to ensure alignment with the Corporate GovernanceCode and best market practices.The committee’s principal role is to review the quality and fairness of the financial reports of the Company and considerthe nature and scope of audit reviews. It also assesses the effectiveness of the accounting, financial and internal controlsystems of the Group.The committee is granted the authority to conduct or authorise investigations into any activities within its terms ofreference.In 2012, two meetings were held to review and make recommendation to the Board on the consolidated financialstatements of the Group for the interim and annual results, and, in particular, assess any changes in accounting policiesand practices, major judgmental areas and compliance with applicable legal and accounting requirements and standards,and other matters such as assessing internal control systems. The committee also reviewed, with management and theauditor of the Company, the accounting principles and practices adopted by the Group and discussed / assessed allkey auditing, internal controls and financial reporting matters, including a review of the interim consolidated financialstatements of the Group for the six months ended 30 June 2012 and the audited consolidated financial statements ofthe Group for the year ended 31 December 2012.The attendance rate at the meetings in 2012 was 100% as set out below. As deemed necessary by the committee,the external auditor and executive officers of the Company attended the meetings to answer any questions raised. Fullminutes of the meetings were recorded and submitted to the Board for its information and review. In addition, severalad hoc meetings were held during the year with management of the Company to discuss accounting, reporting andother issues.Name of DirectorAttendance / Number ofAudit CommitteeMeetings in 2012AttendanceRateJohn William Crawford J.P. (Chairman of the Committee) 2 / 2 100%Gerald Clive Dobby 2 / 2 100%Shane Frederick Weir 2 / 2 100%The Company’s external auditor carried out, in the course of the statutory audit process, a review of the effectivenessof the Company’s material internal financial controls to the scope laid out in their audit plans. Any non-compliancematters and internal control weaknesses noted during the audit and the auditor’s recommendations thereon werereported to and dealt with by the committee.Annual Report 2012 17
e-KONG GROUP LIMITEDCorporate Governance Report (continued)Remuneration CommitteeThe Remuneration Committee was established on 18 December 2001 and the composition of the RemunerationCommittee was changed on 27 March 2012 in compliance with Rule 3.25 of the Listing Rules that requires thecommittee to be chaired by an independent non-executive director. Accordingly, the Remuneration Committee is nowcomprised of Mr. Shane Frederick Weir as the Chairman of the committee and Mr. John William Crawford J.P., bothindependent non-executive directors, and Mr. Richard John Siemens, the Chairman of the Board. Mr. Lim Shyang Guey,another executive director, is the alternate member for Mr. Richard John Siemens. A set of written terms of reference,which describes the authority and duties of the committee as well as proceedings of its meetings, was adopted by theBoard in accordance with both the Former Corporate Governance Code and the Corporate Governance Code, whichterms of reference are incorporated in the written corporate policies of the Company. Such terms of reference andrelated written corporate policies of the Company are under regular review by the Board to ensure alignment with theCorporate Governance Code and best market practices.The committee is responsible for determining mechanisms for setting the Group’s remuneration structure and policieswith reference to fair and objective standards, approving the annual remuneration and incentive plans of the Group and,in particular, determining with delegated responsibility, the remuneration packages of individual executive directors andsenior management, reviewing and approving management’s remuneration proposals with reference to corporate goalsand objectives and dealing with such other matters relating to remuneration issues as directed by the Board. Duringthe year under review, one meeting was held and the attendance rate was 100% as set out below.Name of DirectorAttendance / Number ofRemuneration CommitteeMeetings in 2012AttendanceRateShane Frederick Weir* (Chairman of the Committee) 1 / 1 100%Richard John Siemens 1 / 1 100%John William Crawford J.P. 1 / 1 100%* Appointed as the Chairman of the Committee on 27 March 2012 in place of Mr. Richard John Siemens. Mr. Siemens remains as a memberof the Committee.18Annual Report 2012
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membership no. WW-7311-1586
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Annual Report 2012 - e-KONG Group Limited

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