Terms of Reference of the Audit and Risk Committee

Authority

The Audit and Risk Committee (the “Committee”) shall :

1. have authority to investigate any matter within its terms of reference;
2. have the resources which are required to perform its duties;
3. have full and unrestricted access to any information pertaining to the Company;
4. have direct communication channels with the external and internal auditors;
5. be able to obtain independent professional or other advice; and
6. be able to convene meetings with the external auditors, the internal auditors or both excluding the attendance of other directors and employees of the Company, whenever deemed necessary.

Duties

The duties of the Committee are to :

1. review the following and report the same to the board of directors of the Company :
   
   1. with the external auditor, the audit plan;
   2. with the external auditor, his evaluation of the system of internal controls;
   3. with the external auditor, his audit report;
   4. the assistance given by the employees of the Company to the external auditor;
   5. the adequacy of the scope, competency and resources of the internal audit functions and that it has the necessary authority to carry out its work;
   6. the internal audit plan, processes, the results of the internal audit assessment, investigation undertaken and whether or not appropriate action is taken on the recommendations;
   7. the quarterly results and year-end financial statements, prior to the approval by the board of directors, focusing particularly on :
      
      1. changes in or implementation of major accounting policy changes;
      2. significant matters highlighted including financial reporting issues, significant judgments made by management, significant and unusual events or transactions and how these matters are addressed; and
      3. compliance with accounting standards and other legal requirements;
   8. any related party transactions and conflict of interest situation that may arise within the Company or Group including any transaction, procedure or course of conduct that raises questions of management integrity;
   9. any letter of resignation from the external auditors of the Company; and
   10. whether there is reason (supported by grounds) to believe that the Company’s external auditor is not suitable for re-appointment;
2. assist the Board in its review and monitoring of the adequacy and effectiveness of the Group’s system of risk management including the framework, policies and processes relating thereto;
3. recommend the nomination of a person(s) as external auditors;
4. have policies and procedures to assess annually the suitability, objectivity and independence of external auditors, including the requirements set by the Committee before a former key external audit partner can be appointed a member of the Committee;
5. ensure that the internal audit function is effective and able to function independently;
6. consider other topics as defined by the Board.