Overview Leadership Portfolio & Performance Sustainability & Governance Financial Statements and Other Information The ARC monitors and assesses the role and effectiveness of the internal audit function through reviewing the internal audit process from time to time and may make recommendations to the Boards for any changes to the internal audit process. The ARC also reviews to ensure that the internal audit function is adequately resourced and skilled in line with the nature, size and complexity of the Managers and CLAS’ business, and that an adequate budget is allocated to the internal audit function to assure its proper functioning. In FY 2023, the ARC carried out a review of the internal audit function and was satisfied that the internal audit function performed by CLI IA is adequately resourced, effective and independent. CLI IA formulates its internal audit plan in consultation with, but independently of, Management and its plan is submitted to the ARC for approval prior to the beginning of each year. CLI IA adopts a risk-based approach in formulating the audit plan that aligns its activities to the key strategies and risks across the CLI Group’s and CLAS’ business. The reviews performed by CLI IA are focused on assisting the Boards in promoting sound risk management, robust internal controls and good corporate governance, through assessing the design and effectiveness of operating controls that govern key business processes and risks identified in the overall risk framework of the CLI Group and CLAS. CLI IA also reviews compliance with the CLI Group’s and CLAS’ policies, procedures and regulatory responsibilities, performed in the context of financial and operational, and information system reviews. During FY 2023, the ARC reviewed the results of audits performed by CLI IA based on the approved audit plan. All significant findings are reported to Management and the ARC. CLI IA also reviews the status of implementation of the audit recommendations and whether there are any past due items, and reports the same to Management and the ARC. The ARC also reviewed reports on whistle blower complaints reviewed by CLI IA to ensure independent and thorough investigation and adequate follow up. The ARC also received reports on Interested Person Transactions reviewed by CLI IA that they were on normal commercial terms and are not prejudicial to the interests of CLAS and its minority Stapled Securityholders. This is pursuant to procedures established by the Managers to comply with the Listing Manual requirements relating to interested person transactions. All interested person transactions are reported to and monitored by the Finance department which also keeps tab on the aggregate value, prior to the review by CLI IA. Legal advice is sought, if required, in respect of any issues relating to any specific interested person transaction. In the year under review, save for the Acquisition, there were no significant interested person transactions involving controlling Stapled Securityholders, controlling shareholders of each of the Managers or Directors requiring approval of the Stapled Securityholders. The ARC notes that the CLI IA is independent, effective, adequately resourced and staffed with persons with the relevant qualifications and experience. CLI IA is a corporate member of the Institute of Internal Auditors Inc. (IIA), Singapore, which is an affiliate of the IIA with its headquarters in the United States of America (USA). CLI IA subscribes to, and is guided by, the International Standards for the Professional Practice of Internal Auditing (Standards) developed by IIA, and has incorporated these Standards into its audit practices. To ensure that internal audits are performed effectively, CLI IA recruits and employs suitably qualified professional staff with the requisite skill sets and experience. For instance, CLI IA staff who are involved in IT audits have the relevant professional IT certifications and are also members of the ISACA Singapore Chapter, a professional body administering information systems audit and information security certifications that is headquartered in the USA. The ISACA Information Systems Auditing Standards provide guidance on the standards and procedures to be applied in IT audits. CLI IA identifies and provides training and development opportunities for its staff to ensure their technical knowledge and skill sets remain current and relevant. ANNUAL REPORT 2023 123
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