Internal Control Statement

g. regular and comprehensive flow of information to the Board and Management on all aspects of the Group's operations to facilitate the monitoring of performance against strategic plans;

h. an annual planning and budgetary exercise requiring all divisions to prepare business plans and budgets for the forthcoming year, to be deliberated upon and approved by the Board before implementation;

i. monthly monitoring and half-yearly review of the Group's performance against budgets with any major variances deliberated by the Board;

j. a policy on the External Auditor's independence relating to, inter alia, the requirement for the lead and concurring audit partners to be subject to a five-year rotation with a five-year cooling-off period. Planned statutory audit and non-audit services by External Auditors require prior approval by the AC;

k. engagement of External Auditors to conduct a limited review of quarterly financial results;

l. formal semi-annual and annual appraisals, directed by KPIs, which are based on the CBS approach, to measure staff performance. Training and development programmes are established to ensure that staff are kept up to date with the necessary competencies to carry out their responsibilities towards achieving the Group's objectives;

m. a Code of Ethics for all employees which defines the ethical standards and conduct at work required at Bursa Malaysia;

n. annual on-site regulatory audits by the SC on the Group's operations to ensure compliance with its duties and obligations under the CMSA as well as its salient activities; and

o. engagement of independent auditors and external consultants to conduct systems review on major new systems to ensure that all due processes are undertaken prior to system implementation. The recently launched BTS was subjected to such a review.

REVIEW OF THIS STATEMENT

Pursuant to paragraph 15.24 of the LR, the External Auditors have reviewed this Statement and the Risk Management Statement for inclusion in the annual report for FY2008 and reported to the Board that nothing has come to their attention that causes them to believe that this Statement is inconsistent with their understanding of the process adopted by the Board in reviewing the adequacy and integrity of the system of internal controls.

Additionally, Group IA has reviewed this Statement and reported to the AC that, while it has addressed individual lapses in internal controls during the course of its IA assignments for the year, it has not identified any circumstances which suggest any fundamental deficiencies in the system of internal controls in the Group.

CONCLUSION

The Board is of the view that the system of internal controls in place for the year under review and up to the date of issuance of the annual report and financial statements is sound and sufficient to safeguard the shareholders' investment, the interests of customers, regulators and employees, and the Group's assets.