Notes to the Financial Statements - Cahaya Mata Sarawak Bhd

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58 Statement on Internal Control Risk coordinators have been appointed in each signifi cant SBU or subsidiary unit to update the quarterly risk reports. The major risks are aggregated and risk ratings reviewed by the Group Risk Coordinators and Group Managing Director before presentation to the Group Risk Committee / Board. Major operating units are also required to present quarterly risk reports to their respective Boards to assist them to discharge their governance and fi duciary duties. Key Elements of the Internal Control System The key elements of the Group’s internal control system are described below: • Clearly defi ned delegation of responsibilities to Committees of the Board and the Management, including authorisation levels for all aspects of the businesses. Such delegation is subject to periodic review throughout the year as to their implementation and for their continuing suitability. • Clearly documented internal procedures set out in the Group Financial Policies and Procedures Manual. • A detailed Group Procurement Policies and Procedures Manual to regulate procurement of goods and services in the Group. This includes the centralisation of competitive sourcing and evaluation of major purchases to leverage Group buying power and the establishment of a Central Tender Committee which has the responsibility to review and endorse all high value purchases in the Group. • A detailed strategic planning and budgeting process where operating units prepare business plans and detailed capital and operating budgets for the coming year. These plans are approved by the Board. • All major business commitments or investments will be subject to review in accordance with the procedures set out in the Limits of Authority Manual so as to ensure that all such investments meet the risk appetite and investment criteria determined by the Board and that SBU’s operating budget. • A performance management system has been implemented wherein individual performance of key executives will be monitored against agreed targets (Key Performance Indicators) to strengthen accountability controls and to instill a stronger performance culture. • Monitoring of monthly results against budget through the monthly operations review meetings with subsidiaries with major variances being followed up and management action taken, where necessary. • An independent Audit Committee comprising non-executive members of the Board, all being independent directors. • Regular internal audit activities to assess the adequacy of internal controls, integrity of fi nancial information provided and the extent of compliance with established procedures. • An emphasis on the quality and ability of employees with continuing education, training and development being actively encouraged through a wide variety of programs. • All signifi cant contracts and legally enforceable agreements are vetted by the Group’s Legal Department. There were no signifi cant weaknesses in internal control that resulted in material fi nancial losses during the current fi nancial year. The above control arrangements being in place provide reasonable assurance to the Board that the structure of controls is appropriate to the Group’s operations and that risks are managed to an acceptable level throughout the Group’s diverse businesses. Such arrangements, however, do not eliminate the possibility of human error or deliberate circumvention of control procedures by employees or others. This Statement is made in accordance with a resolution of the Board of Directors dated 3 April 2012. Cahya Mata Sarawak Berhad
Composition The Group Audit Committee comprises the following Board members: Kevin How Kow - Chairman (Independent, Non-Executive Director) Y A M Tan Sri Dato’ Seri Syed Anwar Jamalullail (Independent, Non-Executive Director) Datu Michael Ting Kuok Ngie (Independent, Non-Executive Director) Terms of Reference of the Group Audit Committee Constitution i. The Committee was established by a resolution of the Board on 27 March 1995. ii. The functions of the Committee shall extend to CMS Group of Companies collectively referred to as the “Group”. iii. The Board shall ensure that the composition and functions of the Committee comply as far as possible with both Main Market Listing Requirements (“MMLR”) of Bursa Malaysia Securities Berhad (“Bursa Securities”) as well as other regulatory requirements. Membership i. The members of the Committee shall be appointed by the Board from among their number. They shall consist of not more than fi ve members and not fewer than three members, of whom a majority shall be independent non-executive directors. ii. At least one member of the Committee: Group Audit Committee Report This report provides details of the composition of the Group Audit Committee (“the Committee”), its terms of reference and a summary of activities of the Committee and the Internal Audit function during the year ended 31 December 2011. (a) must be a member of the Malaysian Institute of Accountants (“MIA”); or (b) if he is not a member of the MIA, he must have at least 3 years’ working experience and – • he must have passed the examinations specifi ed in Part I of the First Schedule of the Accountants Act 1967; or • he must be a member of one of the associations of accountants specifi ed in Part II of the First Schedule of the Accountants Act 1967; or (c) fulfi lls such other requirements as prescribed or approved by Bursa Securities. iii. In the event of any vacancy resulting in the non-compliance of para 2(i) above, the Board shall, within three months of that event, appoint such number of new members required to fulfi ll the minimum requirement. No alternate director may be appointed as a member of the Committee. iv. The Chairman of the Committee shall be an independent director appointed by the Board. v. All members of the Committee, including the Chairman, shall hold offi ce only so long as they serve as Directors of the Company. Annual Report 2011 59
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Playing Our Role In Nation-building
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CONTENTS 2 3 4 8 13 14 15 20 Perfor
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Revenue (RM’000) Profi t before t
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“ Dear Shareholders, Group Chairm
Page 9 and 10: Whilst the opportunities for the Gr
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Page 13 and 14: 24 Feb 1 Jul 19 Oct 30 Nov 24 Feb 1
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Page 17 and 18: Board of Directors Tan Sri Dato’
Page 19 and 20: Y Bhg Dato’ Richard Alexander Joh
Page 21 and 22: Y Bhg Datu Michael Ting Kuok Ngie M
Page 23 and 24: DAVID LING KOAH WI Group General Co
Page 25 and 26: Segmental Analysis Segment Revenue
Page 27 and 28: Clinker CMS Cement owns East Malays
Page 29 and 30: Quarrying CMS Quarries Sdn Bhd and
Page 31 and 32: Construction & Road Maintenance The
Page 33 and 34: The Isthmus Property Development Th
Page 35 and 36: Education CMS Education Sdn Bhd own
Page 37 and 38: Strategic Investment: K&N Kenanga H
Page 39 and 40: CORPORATE RESPONSIBILITY
Page 41 and 42: Engagement & Communication Performa
Page 43 and 44: CMS Concrete Products Clay bricks m
Page 45 and 46: CMS Employees Volunteer in ‘Doing
Page 47 and 48: CSR Highlights Saving Lives Health
Page 49 and 50: Statement of Corporate Governance T
Page 51 and 52: Employees’ Share Option Scheme (
Page 53 and 54: Prior to each Board meeting, the Di
Page 55 and 56: Statement of Corporate Governance T
Page 57 and 58: Communicating with Shareholders and
Page 59: Responsibility The Board recognises
Page 63 and 64: Authority i. The Committee is autho
Page 65 and 66: Utilisation of Proceeds raised from
Page 67 and 68: FINANCIALS
Page 69 and 70: The directors have pleasure in pres
Page 71 and 72: Issue of Shares During the fi nanci
Page 73 and 74: Statement by Directors Pursuant to
Page 75 and 76: Independent Auditors’ Report To t
Page 77 and 78: ASSETS Group Company Note 2011 2010
Page 79 and 80: Statements of Changes In Equity For
Page 81 and 82: Statements of Cash Flows For the fi
Page 83 and 84: Statements of Cash Flows For the fi
Page 85 and 86: Notes to the Financial Statements F
Page 107 and 108: 5. Interest income Notes to the Fin
Page 109 and 110: 8. Profi t before tax Notes to the
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10. Directors’ remuneration (cont
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12. Earnings per share (a) Basic ea
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13. Property, plant and equipment (
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Notes to the Financial Statements F
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14. Prepaid land lease payments Cos
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18. Goodwill Notes to the Financial
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19. Investments in subsidiaries (co
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20. Investments in associates (cont
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22. Deferred tax (contd.) Notes to
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24. Trade and other receivables (co
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25. Other current assets Notes to t
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28. Cash and bank balances (contd.)
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30. CMS Income Securities (contd.)
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30. CMS Income Securities (contd.)
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32. Trade and other payables Notes
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36. Other reserves (contd.) Company
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38. Employee benefi ts (contd.) Not
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39. Commitments (contd.) Notes to t
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40. Contingencies (contd.) (b) Othe
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41. Related party transactions (con
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45. Segment information Notes to th
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46. Dividends Notes to the Financia
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OTHER INFORMATION
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Name of Direct Indirect % of Substa
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List of Properties As at 31 Decembe
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** Land owned by third party Revalu
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Construction & Road Maintenance CMS
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1. To receive the Audited Financial
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Names of Directors who are standing
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Form of Proxy No. of Shares Held: C
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CAHYA MATA SARAWAK BERHAD (Company
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Notes to the Financial Statements - Cahaya Mata Sarawak Bhd

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