Audit Committee (Principle 10) Independent and Non-Executive Directors Quek See Tiat (Chairman) Kevin Kwok Khien Lim Ah Doo Song Su-Min The Audit Committee (AC) comprises all independent Directors with majority, including the AC Chairman, having relevant accounting or related financial management experience. The AC does not comprise any former partner or director of ST Engineering’s existing audit firm within two years preceding their appointment to the AC and none of them have any financial interest in the audit firm. The duties of the AC include the following: • reviewing the significant financial reporting issues and judgements so as to ensure the integrity of the financial statements and all announcements relating to financial performance; • reviewing at least annually the adequacy and effectiveness of internal controls and risk management systems; • reviewing the assurance from the Group President & CEO and the Group CFO on the financial records and financial statements; • making recommendation to the Board on the appointment, removal, remuneration and the terms of engagement of the external auditors; • reviewing the adequacy, effectiveness, independence, scope and results of both the external and internal audit functions; and • reviewing the whistleblowing policy and arrangements and all significant whistleblowing cases; the AC Chairman also chairs the Whistle- blowing Committee and is supported by the Group CFO, Group General Counsel, Group Chief Human Resource Officer, Group Head, R&A and Group Head, Internal Audit (Group Head, IA). The Group Head, IA has unrestricted access to the AC. The AC reviews the appointment, remuneration and resignation of the Group Head, IA. ST Engineering’s IA function (IA) is staffed with individuals with the relevant qualifications and experience and comprises a team of 20 staff members, including the Group Head, IA, who reports to the AC. IA is a corporate member of the Singapore Chapter of the Institute of Internal Auditors (IIA) and adopts the International Standards for the Professional Practice of Internal Auditing (the IIA Standards) laid down in the International Professional Practices Framework issued by the IIA. The AC is satisfied that IA is independent, effective and adequately resourced. The AC considered and approved the 2021 Audit Plans for the external and internal audits. In addition, the AC reviewed the adequacy of internal control procedures including cybersecurity issues, interested person transactions and the issues raised in all IA reports. External Auditors The appointment of external auditors is subject to approval at each AGM. In making its recommendations to shareholders on the appointment and reappointment of external auditors, the Board relies on the review and recommendations of the AC. The AC reviews the adequacy, effectiveness, independence, scope and results of the external audit and makes recommendation to the Board on the appointment, removal, remuneration and the terms of engagement of the external auditors. In compliance with the SGX-ST Listing Manual, an audit engagement partner may only be in charge of an audit for up to five consecutive years. PricewaterhouseCoopers LLP, first appointed in 2020, has met this requirement, and the current audit engagement partner also took over ST Engineering’s audit in 2020. Fees paid to the external auditors for audit and non-audit services of the Group for financial year 2021 totalled $4.5m, of which $0.21m or 5% were for non-audit services. The AC was satisfied that the non-audit services provided by the external auditors did not compromise their independence. The Company has complied with Rules 712 and 715 of the SGX-ST Listing Manual in relation to the engagement of its auditors. AC met in 2021 5 times CORPORATE GOVERNANCE REPORT 114 ST ENGINEERING ANNUAL REPORT 2021 GOVERNANCE → Corporate Governance Report 73 ST ENGINEERING SUSTAINABILITY REPORT 2021 OVERVIEW OUR SUSTAINABILITY APPROACH ENVIRONMENTAL SOCIAL GOVERNANCE AWARDS INDEX
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