25
Techno
Dex
Berhad
(627634-A)
ANNUAL REPORT 2016
INTERNAL CONTROL SYSTEM
The Key Elements of the Group’s Internal Control System includes:
a. Organisational structure with clearly defined lines of responsibility, authority and accountability. These delegations of
responsibilities and authority limits are subjected to periodic review throughout the year as to their implementation
and for continuing suitability.
b. Policies and procedures for key business processes are formalised and documented for implementation and
continuous improvements.
c. Clearly defined authorisation limits at appropriate levels are set out for controlling and approving capital expenditure
and expenses.
d. Clearly defined Internal Policies, Standard Operating Procedures and Personnel Manual as the key framework for
good internal control practices. These policy manuals are subject to regular reviews to meet new and changing
business requirements.
e. Regular Management and Operation meetings were conducted to ensure activities and risk mitigation actions
were executed as proposed.
f. Key information covering financial performance and key business aspects are provided to the Senior Management
and Board of Directors on a regular and timely basis.
g. There has been active participation by the Executive Directors in the day-to-day running of business operations
and regular dialogue and reporting to the Board of Directors.
INTERNAL AUDIT FUNCTIONS
The Board acknowledges the importance of the internal audit function. The Board has outsourced its internal audit
function to an independent professional consulting firm as part of its efforts to provide adequate and effective internal
control systems. The internal audit function is carried out in accordance with the annual internal audit plan as approved
by the Audit Committee. The internal audit function adopts accepted auditing practices in addition to an independent
and objective reporting on the state of the Group’s internal control system.
During the financial year under review, the outsourced Internal Auditors reviewed critical business processes, identified
risks and internal control gaps, assessed the effectiveness and adequacy of the existing state of internal control of
the key subsidiaries and recommended possible improvements to the internal control systems. This is to provide
reasonable assurance that such system continues to operate satisfactorily and effectively within the Group. The Board
continuously takes measures to strengthen the control environment.
In the financial year under review, there were no material losses, incurred as a result of weaknesses in the internal
control system that would require disclosure in this Annual Report. The Board will continue to improve and enhance
the existing system risk management and internal control to ensure its adequacy and relevance in safeguarding the
shareholders’ interests and the Group’s assets. This statement was approved by the Board.
The total cost incurred for the internal audit function was RM24,000 for the financial year ended 30 April 2016.
STATEMENT ON RISK MANAGEMENT
AND INTERNAL CONTROL
(continued)
