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Financial Reports &
Governance Other Information HENGYUAN REFINING COMPANY BERHAD l ANNUAL REPORT 2023 79

The BAC held its independent meetings with PwC on 2. EXTERNAL AUDIT
25 February 2023 and 25 August 2023 without the presence The BAC reviewed PwC’s audit plan and scope for the
of Management to discuss and provide feedback on the financial year ended 2023 and the payment of auditors’
Company’s audit for the financial year ended 31 December statutory and non-audit fees.
2022 and 6 months ended 30 June 2023 respectively, the level
of cooperation received from Management, any specific audit Results of PwC’s annual audit and audit findings together
concerns, and the quality of financial reporting. with recommendations and Management’s response were
reviewed by the BAC. Matters included in the Management
Minutes of each BAC meeting was recorded and tabled representation letter were also reviewed by the BAC.
for confirmation at the next following BAC meeting and
subsequently presented to the Board for notation. In 2023, In addition to the review of the annual audit of HRC’s
the BAC Chair presented to the Board the BAC’s financial statements, the External Auditors were engaged
recommendations to approve the annual and quarterly to conduct reviews of selected quarterly financial results
financial statements. during 2023 in accordance with the International Standard
on Review Engagements 2410 “Review of Interim Financial
The BAC Chair also conveyed to the Board, matters of Information Performed by the Independent Auditor of the
significant concern as and when raised by the External Auditors Entity” which were reported and reviewed by the BAC.
or Internal Auditors in the respective quarterly presentations.
On 26 March 2024, the CIA reported that non-audit fees
ACTIVITIES OF THE BAC incurred in FY2023 amounted to RM27,000, representing
approximately 5 per cent of the total remuneration paid to
The BAC holds the overall responsibility for monitoring the External Auditors, which amounted to RM491,280.
HRC’s management of financial risk processes, accounting and
financial reporting practices and ensuring the adequacy and The BAC had assessed and was satisfied with the
effectiveness of internal controls. competency, audit quality and independence of PwC,
whose appointment was approved by shareholders of
The BAC’s key activities for the financial year ended the Company at HRC’s 64 Annual General Meeting.
th
31 December 2023 comprised the following: The assessment was conducted based on the criteria
stipulated in HRC’s External Auditor Assessment Policy.
1. FINANCIAL REPORTING
In overseeing HRC’s financial reporting, the BAC reviewed 3. INTERNAL AUDIT
the quarterly financial statements for the fourth quarter of The IA team conducted the audit work as per the 2023
2022 and the annual audited financial statements for 2022 Annual Audit Plan approved by the BAC on 26 May 2023.
at its meetings on 25 February 2023 and 27 March 2023
respectively. In year 2023, the internal audit function of HRC is monitored
by the BAC and consists of two segments:
The quarterly financial statements for the first, second and
third quarters of 2023, which were prepared in compliance (1) An Internal Audit Department (IAD), which acts as an
with the Malaysian Financial Reporting Standard (MFRS) independent evaluating body to assist and provide
134 Interim Financial Reporting, International Accounting assurance to the Board, the BAC and Management
Standard (IAS) 34 Interim Financial Reporting and of HRC. The IAD is headed by the CIA who reports
Paragraph 9.22, including Appendix 9B of the MMLR, functionally to the Chair of the BAC and administratively
were reviewed at the BAC meetings on 26 May 2023, to the CEO. There is one (1) Internal Auditor who reports
25 August 2023, and 27 November 2023 respectively. to the CIA. The internal auditors have sufficient mix
of knowledge, skills and competencies to execute the
On 23 February 2024 and 26 March 2024, the BAC audit plan; and
reviewed the quarterly financial statements for the
fourth quarter of 2023 and the annual audited financial (2) HRC’s Site Internal Assurance (SIA), which comprises
statements for 2023 respectively. 24 trained and/or ISO certified site internal auditors
from various departments of HRC. The SIA carries
The BAC’s recommendations were presented for approvals out the site internal audits and process effectiveness
at the subsequent Board meetings. of HRC and reports to the Quality & Health, Security,
Safety and Environment Manager. All SIA internal audit
reports are reviewed by the CIA before finalisation.