Corporate Governance As part of the ERM Framework, the Managers undertake and perform a Risk and Control Self-Assessment (RCSA) annually to identify material risks along with their mitigating measures. The adequacy and effectiveness of the systems of risk management and internal controls are reviewed at least annually, by Management, the ARC and the Boards, taking into account the best practices and guidance in the Risk Governance Guidance for Listed Boards issued by the Corporate Governance Council and the Listing Manual. CLAS’ RAS, which incorporates CLAS’ limits, addresses the management of material risks faced by CLAS. Alignment of CLAS’ risk profile to CLAS’ RAS is achieved through various communication and monitoring mechanisms (including key risk indicators set for Management) put in place across the various functions within the Managers. More information on the Managers’ ERM Framework including the material risks identified can be found in the Risk Management section on pages 58 to 62 of this Annual Report. The internal and external auditors conduct reviews of the adequacy and effectiveness of the material internal controls (including financial, operational, compliance, IT and sanctions-related controls) and risk management systems. This includes testing, where practicable, material internal controls in areas managed by external service providers. Any material non-compliance or lapses in internal controls together with corrective measures recommended by the internal and external auditors are reported to and reviewed by the ARC. In the course of their statutory audit, the external auditors had considered the risk assessment conducted by the internal auditors. Any material non-compliance and weakness in internal controls, together with the internal auditors’ recommendations to address them, are reported to the ARC. The ARC also reviews the adequacy and effectiveness of the measures taken by the Managers on the recommendations made by the internal and external auditors in this respect. The Boards have received assurance from the CEO and the Chief Financial Officer (CFO) of the Managers that the financial records of CLAS have been properly maintained and the financial statements for FY 2024 give a true and fair view of CLAS’ operations and finances. They have also received assurance from the CEO, the CFO and the relevant KMP who have responsibility regarding various aspects of risk management and internal controls that the systems of risk management and internal controls within CLAS are adequate and effective to address the risks (including financial, operational, compliance, IT and sanctions-related risks) that the Managers consider relevant and material to the current business environment. The CEO, the CFO and the relevant KMP of the Managers have obtained similar assurances from the respective risk and control owners. In addition, for FY 2024, the Boards received half-yearly certification by Management on the integrity of financial reporting and the Boards provided a negative assurance confirmation to Stapled Securityholders as required by the Listing Manual. Based on the ERM Framework established and the reviews conducted by Management and both the internal and external auditors, as well as the assurance from the CEO and the CFO, the Boards are of the opinion that the systems of risk management and internal controls (including financial, operational, compliance, IT and sanctions-related controls) are adequate and effective to address the risks (including financial, operational, compliance, IT and sanctions-related risks) which CLAS considers relevant and material to its current business environment as at 31 December 2024. The ARC concurs with the Boards in their opinion. No material weaknesses in the systems of risk management and internal controls were identified by the Boards or the ARC in the review for FY 2024. The Boards note that the systems of risk management and internal controls established by the Managers provide reasonable assurance that CLAS, as it strives to achieve its business objectives, will not be significantly affected by any event that can be reasonably foreseen or anticipated. However, the Boards also note that no system of risk management and internal controls can provide absolute assurance in this regard, or absolute assurance against poor judgement in decision-making, human error, losses, fraud or other irregularities. Principle 10: Audit and Risk Committee The ARC comprises four non-executive Directors, all of whom (including the ARC chairman) are IDs. They bring recent and relevant managerial and professional expertise or experience in accounting, auditing and related financial management domains. The ARC does not comprise former partners of the external auditors, Deloitte & Touche LLP (Deloitte) (a) within a period of two years commencing from the date of their ceasing to be partners of Deloitte; or (b) who have any financial interest in Deloitte. The ARC has explicit authority to investigate matters within its terms of reference. Management gives the fullest co-operation in providing information and resources to the ARC, and carrying out its requests. The ARC has direct access to the internal and external auditors and 82 CapitaLand Ascott Trust
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