Audit Committee Report

SUMMARY OF ACTIVITIES

The AC's activities during the FY2008 encompassed the following:

a. In overseeing financial reporting, the AC reviewed the quarterly financial statements for the fourth quarter of FY2007 and the annual audited financial statements for FY2007 at its meeting on 29 January 2008, and the quarterly financial statements for the first, second and third quarters of FY2008 were reviewed at its meetings on 16 April 2008, 16 July 2008 and 21 October 2008 respectively, before recommending the same for the Board's approval;

b. On 14 November 2008, the AC reviewed the External Auditors' Audit Planning Memorandum comprising their scope of audit and proposed fees for the statutory audit and review of the Internal Control Statement for FY2008;

c. The AC deliberated on the External Auditor's report and recommendations regarding opportunities for improvement to internal controls based on observations made in the course of the audit at its meeting on 29 January 2008;

d. The AC approved the IA's Annual Audit Plan for 2009 at its meeting on 14 November 2008. The Head of Group IA presented to the AC at every AC meeting the Group IA's reports on the status and progress of IA assignments, including the summary of audit reports issued, audit recommendations provided by Internal Auditors and Management's response to these recommendations, plus non-audit assignments, for the purpose of evaluating system readiness on key system development projects, tender evaluation and monitoring employees' dealings in securities;

e. At the meeting on 16 April 2008, the Head of Group IA presented the post-mortem report for the Annual IA Plan of 2007 which provided an overall indication of the adequacy and effectiveness of security and controls implemented;

f. On 16 April 2008, the AC reviewed the results of the Group IA's Customer Satisfaction Survey for 2007 which included an analysis of IA's strengths and weaknesses and action plans to improve audit services to IA's customers;

g. At the meeting on 18 June 2008, the AC deliberated on the Head of Group IA's 2008 Balanced Scorecard and KPIs;

h. On 14 November 2008, the AC reviewed the annual Internal Control Statement and the Risk Management Statement referred to in the Internal Control Statement to be published in the Annual Report;