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Terms of Reference




Audit Committee

The purpose of the setting up of the Audit Committee (“AC” or “Committee”) is to assist the Board of Directors of the Company (“Board”) in discharging its duties to identify principal risks, ensuring the implementation of appropriate systems of internal controls to manage such risks, and that such systems are working effectively to safeguard shareholders' investment in and the long term viability of the Company and its subsidiaries (“Group”).

The Terms of Reference of the AC are as follows:-

A. COMPOSITION

Membership

1The Committee shall be appointed by the Board from amongst its members and shall at all times consist of not less than three (3) directors, exclusively Non-Executive Directors of whom majority shall be the Independent Directors and at least one of them:-
  • must be a member of the Malaysian Institute of Accountants (“MIA”); or
  • if he is not a member of the MIA, he must have at least three (3) years’ working experience and:-
    • he must have passed the examinations specified 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 specified in Part II of the First Schedule of the Accountants Act 1967; or
  • fulfils such other requirements as prescribed or approved by the Bursa Malaysia Securities Berhad.
2No alternate director shall be appointed as a member of the Committee.

3In the event that the number of AC members is reduced to below three (3), the Board shall, within three (3) months of that event, appoint such number of new members as may be required to make up the minimum number of three (3) members.

4A former key audit partner1 shall observe a cooling-off period of at least three (3) years before being appointed as a member of the Committee or such other period stipulated under the By-Laws (on Professional Ethics, Conduct and Practice) by the Malaysian Institute of Accountants, whichever is longer.

1 The engagement partner and the partner responsible for the engagement quality control review as well as other audit partners, if any, on the engagement team who make decisions or judgments on significant matters with respect to the audit of the Company’s financial statements on which the auditor will express an opinion.

5The term of office and performance of the Committee and each of its members shall be reviewed by the Board/Nomination Committee of the Company annually to determine whether the Committee and its members have carried out their duties in accordance with their terms of reference.

Chairman
The Chairman shall be elected by the members of the Committee and should be an Independent Director. The Chairman of the Committee must not be the Chairman of the Board.

Secretary
The Company Secretary shall act as the Secretary of the Committee.

B. DUTIES AND RESPONSIBILITIES

Risk Management Systems, Internal Controls and Governance Processes

To review the adequacy and effectiveness of the risk management systems, internal controls and governance processes implemented in the Company and/or the Group.

External Audit
  • To review and recommend the nomination of a person or persons as external auditors.
  • To review with the external auditors the scope of audit plan, system of internal controls and their reports thereon.
  • To assess the performance of the external auditors and make recommendations to the Board on their appointment/reappointment, remuneration and resignation/removal.
  • To review the suitability, independence and objectivity of the external auditors and their services, including non-audit services.
  • To review the provision of non-audit services by the external auditors for recommendation to the Board for approval.
  • To review the assistance given by the employees of the Group to the external auditor.
Internal Audit
  • To review the adequacy of the scope, functions, competency and resources of the internal audit functions and that it has the necessary authority to carry out its work.
  • To review the internal audit plan and the effectiveness of internal audit processes, consider the major findings of internal audit investigations and ensure co-ordination between the internal and external auditors.
Audit Reports

To review the internal and external audit reports to ensure that appropriate and adequate remedial actions are taken by the Company management to address and resolve the significant lapses in controls and procedures that are identified.

Financial Reporting
  • To review the quarterly results and year-end financial statements prior to submission to the Board for approval, focusing particularly on -
    • changes in or implementation of major accounting policy changes;
    • significant matters highlighted including financial reporting issues, significant judgments made by management, significant and unusual events or transactions, and how these matters are addressed; and
    • compliance with accounting standards and other legal requirements;
  • To review the accounting policies adopted, any changes in accounting principles or practices and the level of prudence applied in areas requiring judgement.
  • To review arrangements established by management for compliance with any regulation or other external reporting requirements.
Related Party Transactions and Conflict of Interests

To review any related party transaction and conflict of interests situation that arose, persist or may arise within the listed issuer or group including any transaction, procedure or course of conduct that raises questions of management integrity, and the measures taken to resolve, eliminate, or mitigate such conflicts, if any.

Other Matters

To consider such other matters as the Committee considers appropriate or as authorised by the Board.

C. AUTHORITY

The Committee shall, in accordance with a procedure determined by the Board and at the cost of the Company:
  • have authority to investigate any matter within its terms of reference;
  • have the resources which are required to perform its duties;
  • have full and unrestricted access to any information pertaining to the Company or the Group;
  • have direct communication channels with the external auditors and person(s) carrying out the internal audit function or activity;
  • be able to obtain independent professional or other advice; and
  • be able to convene meetings with the external auditors, the person(s) carrying out the internal audit function or activity or both, excluding the attendance of other directors and employees of the Company, whenever deemed necessary.

D. MEETINGS

Meetings shall be held once every quarter. The Chairman shall call a meeting of the Committee if requested to do so by any Committee member, the management or the internal or external auditors. The Committee may invite the members of the Board, the management, the internal auditors and the representative of the external auditors to attend any of its meetings, as it deems necessary.

The quorum for a meeting of the Committee shall be two (2) members who shall be independent directors.

The Company Secretary is also responsible for keeping the minutes of the meeting of the Committee, circulating them to the Committee members and to the other members of the Board and following up on outstanding matters.

E. GENERAL

Words importing the masculine gender shall be deemed and taken to include the feminine.

These terms of reference may, subject to the Board’s approval, be reviewed from time to time.


Remuneration Committee

1.0MEMBERSHIP

1.1The Remuneration Committee (“RC”) of ViTrox Corporation Berhad [VCB] (“VCB” or “the Company”) shall be appointed by VCB Board of Directors (“VCB Board”) from amongst its members, and shall comprise of not fewer than 3 members, consisting wholly or mainly of non-executive directors, at least one member who shall be independent and knowledgeable in executive compensation, failing which expert advice may be obtained internally or externally.

1.2No Alternate Director shall be appointed as the Member of the Committee unless the Alternate to the RC Member.

1.3The Chairman shall be elected by members of the RC. In the absence of the committee Chairman, the remaining members present shall elect one of their members to chair the meeting.

1.4A Secretary shall be nominated by the RC.

1.5A member who wishes to retire or resign from the RC shall notify VCB Board in writing.

1.6If a member, for any reason, ceases to be a member, VCB Board shall appoint a new member so that the number of members does not fall below three.

1.7The office of a member shall become vacant upon the member’s resignation/ retirement/removal or disqualification as a Director of the Company.


2.0DUTIES, POWERS AND FUNCTIONS

2.1The duties of the RC shall be (on an annual basis):
  • to review and recommend to VCB Board in consultation with Management and the Chairman of the Board, a framework of remuneration and to determine the specific remuneration packages and terms of employment for each of the executive Directors and senior executives/divisional Directors those reporting directly to the Chairman and the Group Managing Director/CEO of the Group including those employees related to the executive Directors and controlling shareholders of the Group.
  • to recommend to VCB Board in consultation with Management and the Chairman of the Board, any long term incentive schemes which may be set up from time to time and to do all acts necessary in connection herewith.
  • to carry out its duties in the manner that it deemed expedient, subject always to any regulations or restrictions that may be imposed upon the RC by VCB Board from time to time.
  • to produce an annual report of the Committee’s remuneration policy which will form part of the Company’s Annual Report and Accounts, and consider each year that the shareholders at the AGM should be invited to approve the above remuneration policy as set out in the Company’s Annual Report and Accounts.
2.2As part of its review, the RC shall ensure that:
  • all aspects of remuneration including Director’s fees, salaries, allowances, bonuses, options and benefits-in-kind should be covered, and observe any major changes in employee benefit structures throughout the Group.
  • the remuneration packages should be comparable within the industry and comparable companies and shall include a performance-related element coupled with appropriate and meaningful measures of assessing individual executive Directors’ and senior executives/divisional Directors’ performances.
  • the remuneration package of employees related to executive Directors and controlling shareholders of the Group are in line with the Group’s staff remuneration guidelines and commensurate with their respective job scopes and levels of responsibilities.
  • (iv) to determine the policy for and scope of service agreements for the executive management team, termination payments and compensation commitments, including fixing appointment period for the Directors.
  • (v) to ensure the level of remuneration for Non-executive Directors and Independent Directors are linked to their level of responsibilities undertaken and contribution to the effective functioning of the Board.
3.0ADMINISTRATION

3.1Meetings
  • The meetings of the RC may be conducted by means of telephone conferencing or other methods of simultaneous communication by electronic or telegraphic means and the minutes of such a meeting signed by the Chairman shall be conclusive of any meeting conducted as aforesaid.
  • A resolution in writing signed or approved by letter, telex or facsimile by a majority of members (of whom must be Non-executive Directors and at least one must be an independent Director) shall be effective for all purposes as if it were a resolution passed at a meeting of the Committee duly convened, held and constituted. Any such resolution may consist of a single document or several documents all in like form each signed by one or more members.
  • The meetings shall be held at least once a year. Additional meetings may also be held by the RC to discuss other issues, which the RC considers necessary.
  • The RC shall have full discretion with regard to the calling of the meetings and the proceedings thereat and may invite any Director or management to its meetings.
  • The RC shall appoint a secretary who shall attend all meetings and minute the proceedings and resolutions of all committee meetings, including the names of those present and in attendance. The minutes shall be confirmed by the Chairman of the meeting and circulated to all members of the RC.
  • The quorum necessary for the transaction of business shall be two of whom must be majority of Non-Executive Directors and at least one must be an independent Director. A duly convened meeting of the committee at which a quorum is present shall be competent to exercise all or any of the authorities, power and discretion vested or exercisable by the Committee.
3.2Notice
The notice of each meeting of the RC, confirming the venue, time and date and enclosing an agenda of items to be discussed, shall other than under exceptional circumstances, be forwarded to each member of the RC not fewer than three (3) working days prior to the date of the meeting.

3.3Voting
Each member present shall have one vote. All resolutions passed in the meeting shall be by majority votes. If the votes for and against a resolution are equal, the Chairman of the meeting shall have a casting vote

4.0GENERAL

4.1The RC in carrying out its tasks under these terms of reference may obtain such external or other independent professional advice as it considers necessary to carry out its duties.

4.2VCB Board will ensure that the RC has access to professional advice both internally and externally at the Company’s expense in order for it to perform its duties.

4.3These terms of reference may from time to time be amended as required, subject to the approval of the Board.
Nomination Committee

1.0MEMBERSHIP

1.1The Nomination Committee (“NC” or “Committee”) of ViTrox Corporation Berhad (“VCB” or “the Company”) shall consist of not less than 3 Directors appointed by VCB Board of Directors (“Board”), of whom should be exclusively Non-Executive Directors, a majority of whom must be independent

1.2No Alternate Director shall be appointed as the Member of the Committee unless the Alternate to the NC Member.

1.3The Chairman shall be elected by members of the NC. In the absence of the Committee Chairman, the remaining members present shall elect one of their members to chair the meeting.

1.4A Secretary shall be nominated by the NC.

1.5A member who wishes to retire or resign from the NC shall notify the Board in writing.

1.6If a member, for any reason, ceases to be a member, the Board shall appoint a new member so that the number of members does not fall below 3.

1.7The office of a member shall become vacant upon the member’s resignation/ retirement/removal or disqualification as a Director of the Company.


2.0DUTIES, POWERS AND RESPONSIBILITIES

2.1The NC shall make recommendations to the Board on the appointment of new executive and non-executive Directors, including making recommendations to the composition of the Board generally and the balance between executive and non-executive Directors appointed to the Board. The NC shall keep under review the leadership needs of the organisation with a view of ensuring the continued ability to compete effectively in the organisation’s marketplace.
2.2Without prejudice to the generality of the foregoing, the NC shall:-

2.2.1review the structure, size and diversity (including without limitation, gender, age, cultural and educational background, ethnicity, professional experience, skills, knowledge and length of service) of the Board at least annually; and make recommendations to the Board with regards to any adjustment that are deemed necessary.

2.2.2consider the election criteria and develop procedures for the sourcing and election of candidates to stand for election by VCB’s shareholders (“Shareholders”) or to fill casual vacancies of Directors. In identifying suitable candidates, the Committee shall consider candidates on merit and against the objective criteria, with due regard for the benefits of diversity on the Board.

2.2.3identify and nominate candidates to the Board for it to recommend to Shareholders for election as Directors. Sufficient biographical details of nominated candidates shall be provided to the Board and Shareholders (as the case may be) to enable them to make an informed decision.

2.2.4determine the suitability and eligibility of nominating candidates for the approval of the Board, to fill Board vacancies as and when they arise as well as put in place plans for succession, in particular for the Chairman and Chief Executive of VCB. If the NC determines that a Director, who has one or more of the relationships that could interfere with his exercise of independent business relationship judgment, is in fact independent, it should disclose in full nature of the Director’s relationship and bear responsibility for explaining why he should be considered independent.

2.2.5shall decide whether or not a Director is able to and has been adequately carrying out his/her duties as a Director, particularly when he/she has multiple board representatives.

2.3The NC shall recommend Directors who are retiring by rotation under the Company’s Constitution to be put forward for re-election.
2.4The NC shall undertake an annual assessment of its Independent Directors and justify to the Board the retention of an Independent Director who has served in that capacity for more than 9 years, up to a cumulative period of less than 12 years, as an independent director.

2.5The NC shall review the training needs for the Directors regularly.

2.6The NC shall have due regard to the principles of governance and code of best practice and shall liaise with the Board in relation to the preparation of the NC’s report to shareholders (in the annual report) as required.

2.7The NC shall decide how the performance of the Board as a whole and Members of the Board may be evaluated and propose objective performance criteria, key areas for improvement and the requisite follow-up actions. The criteria for assessment of Directors shall include attendance record, intensity of participation at meetings, quality of interventions and special contributions.

2.8The NC shall do any such things to enable the Committee to discharge its powers and functions conferred on it by the Board; and

2.9The NC conform to any requirement, direction, and regulation that may from time to time be prescribed by the Board or contained in the Company’s Constitution or imposed by legislation.

3.0MEETINGS AND PROCEEDINGS

3.1The meetings of the NC may be conducted by means of telephone conferencing or other methods of simultaneous communication by electronic or telegraphic means and the minutes of such a meeting signed by the Chairman shall be conclusive of any meeting conducted as foresaid.

3.2A resolution in writing signed or approved by letter, telex or facsimile by a majority of members (of whom at least one must be an independent Director) shall be effective for all purposes as if it were a resolution passed at a meeting of the Committee duly convened, held and constituted. Any such resolution may consist of a single document or several documents all in like form each signed by one or more members.

3.3Meetings of the NC will be held as the NC deems to be appropriate; however, the NC should meet at least once each year. Meetings should be organised so that attendance is maximised. A meeting may be called, at any other time, by the Chairman of the NC or any member of the NC. Any Director or management may be invited to the meetings.

3.4The notice of each meeting of the NC, confirming the venue, time and date and enclosing an agenda of items to be discussed, shall other than under exceptional circumstances, be forwarded to each member of the NC at least 7 days prior to the date of the meeting.

3.5The quorum shall consists of 2 members, where the majority of members present must be Independent Directors.

3.6Each member present shall have 1 vote. All resolutions passed in the meeting shall be by majority votes. If the votes for and against a resolution are equal, the Chairman of the meeting shall have a casting vote.

3.7The Chairman (or in his absence, an alternate to the member of the NC) of the NC shall attend the Annual General Meeting and be prepared to answer questions concerning the appointment of executive and non-executive Directors and maintain contact as required with the Company’s principal shareholders about the appointment of executive and non-executive Directors in the same way as for other matters.

3.8Minutes of meetings shall be taken by the NC Secretary. Minutes of all meetings shall be confirmed by the Chairman of the meeting and circulated to all the members of the NC.

If the Chairman of the NC so decides the minutes shall, be circulated to other members of the Board, any Director may, provided that there is no conflict of interest and with the agreement of the Chairman, obtain copies of the NC’s minutes.


4.0GENERAL

4.1The NC in carrying out its tasks under these terms of reference may obtain such external or other independent professional advice as it considers necessary to carry out its duties.

4.2The Board will ensure that the NC will have access to professional advice both internally and externally at the Company’s expense in order for it to perform its duties.

4.3These terms of reference may from time to time be amended as required, subject to the approval of the Board.