Annual Report 2012, PDF - Axiata Group Berhad - Investor Relations

BOARD AUDITCOMMITTEE REPORT• Reviewed latest accounting and reporting standardsand policies, where applicable to Axiata;• Reviewed current matters in relation to compliancewith legal, regulatory and statutory requirements;• Reviewed and approved revisions to Axiata GroupInternal Audit Manual;• Reviewed business control incidents and identifiedcases of control weaknesses including fraud forsharing of lessons learnt within the Group to avoidsimilar incidents; and• Verified the allocation of 18,444,000 share options orshare awards given to the Group’s eligible employeesin accordance with the Performance Based ESOS andShare Scheme for FY12. The BAC was satisfied thatthe allocation of the said share options or shareawards was in compliance with the criteria set out inthe ESOS Bye-Laws and Share Scheme Committee.• The Chairman of the BAC is also the Chairman ofCelcom’s BAC. In addition, the Chairman of the BACalso attended one XL BAC meeting held in Jakarta,Indonesia in 2012.GROUP INTERNAL AUDITThe internal audit function is under the purview of AGIAand headed by the Group Chief Internal Auditor (GCIA),who is independent and reports directly to the BAC. Theinternal audit reporting structure within the Group hasbeen organised where audit departments of the OpCosreport directly to the BAC of the respective OpCo witha dotted reporting line to the GCIA. AGIA has directcontrol and supervision over internal audit activities inthe OpCos that do not have an audit function. GCIA alsoacts as the secretary to the BAC.AGIA provides independent, objective assurance onareas of operations reviewed, and recommendationbased on best practices that will improve and add valueto the Group. AGIA identifies, coordinates and conductsglobal audits that are to be carried out throughout theGroup and also provides standards, policies, guidelinesand advice to the OpCos audit function to standardisethe internal audit activities within the Group.AGIA adopts a systematic and disciplined approach toevaluate adequacy and effectiveness of the riskmanagement, financial, operational, compliance andgovernance processes. Structured risk-based andstrategic-based approaches are adopted in identifyingthe internal audit activities that are aligned with theGroup’s strategic plans to ensure those risks facing theGroup are adequately reviewed.In addition, international standards and best practices areadopted to further enhance the relevancy andeffectiveness of the internal audit activities.In April 2012, AGIA participated in the online Global AuditInformation Network (GAIN) 2011 Annual BenchmarkingStudy that was hosted by the Institute of InternalAuditors. A total of 365 companies from across theglobe took part in this benchmarking on internal auditand BAC activities. Axiata was benchmarked against fourtier groups that included telecommunications companiesand companies with revenue of USD5 billion to USD15billion. Among the positive observations from thebenchmarking report are:AGIA– AGIA’s total cost per auditor is the lowest.– AGIA planned and performed the highest number ofaudits.– AGIA’s audit life cycle of 59 calendar days iscomparable to the other tiers.– AGIA auditors received the highest number of traininghours.108