Dagang NeXchange Berhad Annual Report 2018

71 Annual Report 2018 Budgeting, Forecasting and Performance Management A comprehensive budgeting and forecasting system is in place where each operating unit submits an annual budget for review by the Management team prior to submission to the Board for approval. An annual exercise involving all business units to prepare a comprehensive budget for succeeding five (5) years period using a detailed budgeting and brainstorming process is in place. The Group’s business strategic directions in terms of financial and major initiatives are then further reflected in the respective corporate, subsidiaries and support unit performance scorecard. A monthly review by Management team, serves as a performance management tool of actual performance against approved budgets, activities and performance of prior period are carried out, allowing for timely response and corrective action to be taken to catch up to the targeted plan and the final results of the evaluation of the performance of the Corporate and Business Leaders across DNeX Group at the end of the financial year end. The Audit Committee reviews the Groups’ quarterly financial results and subsequently reports to the Board for deliberation and approval, prior to submission to Bursa Securities for release to shareholders and stakeholders. The annual audited financial statements by external auditors provide further assurance on the credibility of DNeX’s financial reports are issued to the shareholders within the stipulated time prescribed under the Main Market Listing Requirement (“MMLR”) of Bursa Securities. Financial and Operating Policies The Group adopts the generally accepted accounting principles and the Malaysian Financial Reporting Standards. Policies and procedures covering financial matters such as procurement, accounts payable, accounts receivables, and treasury; and others such as information security, business continuity, risk management, code of conduct, whistleblowing and compliance are clearly documented. A set of Group level internal policies and procedures are maintained and accessible to employees via internal portal. The policies and procedures at both Group level and business or operational level are regularly reviewed for updates to resolve operational deficiencies and to meet new compliance requirements. Human resource management and talent development Group Human Resource has throughout the year revisited and improvised the following in order to have an integral talent development strategy at a more realistic and achievable pace i.e. skill building, transitioning client relationships, developing leadership competencies and others: i. Succession Planning (“SP”) Process Flow and Framework ii. SP List of Position Identification or Leadership Team iii. Data Collection for SP Competencies for each position particularly Technical & Leadership positions Manpower planning requirement is carried out, mirroring the approved budget planning in order to optimise manpower and increase productivity. Employee training needs are also assessed regularly to close any competency gap. Communication and feedback Communication remains the key in embedding a risk conscious culture amongst our internal and external stakeholders. Regular Groups’ briefings with Investment Analysts are conducted to apprise the shareholders, stakeholders and general public of the Group’s performance whilst promoting transparency and open discussion. All feedbacks are regularly collated and analysed with appropriate follow up action taken by Media and Investor Relations and Customer Service Engagement Unit, whom which act as a point of contact to respond to various enquiries and feedback. MANAGEMENT COMMITMENT The Board received assurance from the Executive Deputy Chairman, Group Managing Director and Chief Financial Officer that to the best of their knowledge, the Group’s risk management and internal control system is sound and effective, providing reasonable assurance that the structure and operation of controls are appropriate for the Group’s operations. Where weaknesses are identified, rectification steps have been put in place to strengthen the system of risk management and internal control so as to safeguard shareholders’ investments, the interests of customers, regulators and employees, and the Group’s assets. REVIEWOF STATEMENTONRISKMANAGEMENT AND INTERNAL CONTROL BY EXTERNAL AUDITORS In accordance with Paragraph 15.23 of the MMLR, the external auditors have reviewed this Statement on Risk Management and Internal Control for inclusion in this Annual Report and had reported to the Board that nothing has come to their attention that causes them to believe that the statement is inconsistent with their understanding of the process adopted by the Board in reviewing the adequacy and integrity of the system of internal control. This statement is made in accordance with a resolution of the Board dated 27 February 2019. CORPORATE ACCOUNTABILITY Statement on Risk Management and Internal Control