Role of the Audit Committee for Interested Person Transactions
The Manager’s internal control procedures are intended to ensure that Interested Person
Transactions are conducted at arm’s length and on normal commercial terms, and are not prejudicial
to Ascott Reit and Unitholders’ interests.
The Manager maintains a register to record all Interested Person Transactions which are entered into
by Ascott Reit (and the basis on which they are entered into, including the quotations obtained to
support such basis). All Interested Person Transactions are subject to regular periodic reviews by the
AC, which in turn obtains advice from CL IA, to ascertain that the guidelines and procedures
established to monitor Interested Person Transactions, including the relevant provisions of the Listing
Manual and the Property Funds Appendix, as well as any other guidelines which may from time to
time be prescribed by the SGX-ST, the MAS or other relevant authorities, have been complied with.
The review includes an examination of the nature of the transaction and its supporting documents or
such other information deemed necessary by the AC. If a member of the AC has an interest in a
transaction, he is to abstain from participating in the review and approval process in relation to that
transaction.
Details of all Interested Person Transactions (equal to or exceeding S$100,000 each in value) entered
into by Ascott Reit during FY 2014 are disclosed on page 208 of the Annual Report.
Dealing with Conflicts of Interest
The following principles and procedures have been established to deal with potential conflicts of
interest which the Manager (including its Directors, executive officers and employees) may
encounter in managing Ascott Reit:
(a) the Manager is a dedicated manager to Ascott Reit and will not manage any other REIT or be
involved in any other real property business;
(b) all resolutions at meetings of the Board in relation to matters concerning Ascott Reit must be
decided by a majority vote of the Directors, including at least one non-executive independent
Director;
(c) in respect of matters in which CL and/or its subsidiaries have an interest, whether direct or
indirect, any nominees appointed by CL and/or its subsidiaries to the Board will abstain from
voting. In such matters, the quorum must comprise a majority of the non-executive independent
Directors and shall exclude such nominee Directors of CL and/or its subsidiaries;
(d) in respect of matters in which a Director or his associates have an interest, whether direct or
indirect, such interested Director will abstain from voting. In such matters, the quorum must
comprise a majority of the Directors and shall exclude such interested Director(s);
(e) if the Manager is required to decide whether or not to take any action against any person in
relation to any breach of any agreement entered into by the Trustee for and on behalf of Ascott
Reit with an affiliate of the Manager, the Manager is obliged to consult with a reputable law firm
(acceptable to the Trustee) which shall provide legal advice on the matter. If the said law firm
is of the opinion that the Trustee, on behalf of Ascott Reit, has a prima facie case against the
party allegedly in breach under such agreement, the Manager is obliged to pursue the
appropriate remedies under such agreement; and
(f) at least one-third of the Board shall comprise non-executive independent Directors.
Corporate Governance
42 | Ascott Residence Trust Annual Report 2014
