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TREASURY CHINA TRUST ANNUAL REPORT 2011
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The Board of the Trustee-Manager is of the view that the Audit Committee has sufficient management expertise and experience
amongst its members to discharge the functions of the Audit Committee. The Audit Committee may invite any Director or
management staff to attend its meetings and is also authorised to seek external professional advice to enable it to discharge
its functions.
The principal role of the Audit Committee is to monitor and evaluate the effectiveness of the Trustee-Manager’s internal
controls. The Audit Committee also reviews the quality and reliability of information prepared for inclusion in the financial
reports, and is responsible for the nomination of external auditors and reviewing the adequacy of external audits in respect of
cost, scope and performance. The Audit Committee’s responsibilities also include, but are not limited to, the following:
(i) monitoring the procedures established to regulate Interested Person Transactions, including ensuring compliance with
the provisions of the Listing Manual relating to Interested Person Transactions;
(ii) reviewing external audit reports to ensure that where deficiencies in internal controls have been identified, appropriate
and prompt remedial action is taken by management;
(iii) reviewing the financial statements and the internal audit reports to ascertain that the guidelines and procedures
established to monitor Interested Person Transactions and conflicts of interest have been complied with;
(iv) resolving any conflicts of interest which may arise;
(v) ensuring that the internal audit function is adequately resourced and has appropriate standing with TCT;
(vi) monitoring the procedures in place to ensure compliance with applicable legislation, the Listing Manual and the
BTA;
(vii) nominating external auditors;
(viii) reviewing the nature and extent of non-audit services performed by external auditors;
(ix) examining with management the effectiveness of financial, operating and compliance controls and reviewing and
approving recruitment of senior personnel in the financial, operating and compliance sectors;
(x) examining matters brought to the attention of the Audit Committee by the management of the SPVs and highlighting any
relevant matter for the Board’s consideration before it issues confirmation under Rule 705(5) of the Listing Manual;
(xi) reviewing, on an annual basis, the independence and objectivity of the external and internal auditors;
(xii) meeting with external and internal auditors, without the presence of the Executive Officers, at least on an annual
basis;
(xiii) commissioning an annual internal controls audit, to be discontinued only after the Audit Committee is satisfied with
the TCT Group’s internal controls are robust and effective enough to mitigate any internal control weaknesses, and
thereafter to carry out such internal controls audit as and when the Audit Committee deems fit in order to satisfy itself
that the TCT Group’s internal controls remain robust and effective;
(xiv) reviewing the Chief Financial Officer’s time spent in the People’s Republic of China in overseeing such aspects of the
finance and reporting functions of TCT which are to be carried out in the People’s Republic of China, to ensure that the
Chief Financial Officer is spending sufficient time in the People’s Republic of China to be familiar with the operations
of TCT, to effectively control such finance and reporting functions and to properly prepare TCT’s accounts;
(xv) investigating any matters within the Audit Committee’s terms of reference, whenever it deems necessary; and
(xvi) reporting to the Board on material matters, findings and recommendations.
The Audit Committee met with the external auditors separately without the presence of management several times during the
year. In conjunction with the policy for the provision of non-audit services adopted by the Audit Committee in October 2011,
the Audit Committee have reviewed, and is satisfied that the non-audit services provided to the TCT Group by the external
auditors for the year ended 31 December 2011, does not affect the independence and objectivity of the external auditors.
During the year, the Audit Committee met seven times. The activities at the meetings included the following:
• review of the quarterly and year end results and announcement required by the SGX-ST;
• review of annual budgets and other forecast financial information to assist in future planning;
• discussions with the external auditor on the annual audit plan and year-end timetable;
• reviewing and approving the scope of work to be undertaken by the external third party appointed to undertake the
internal audit function;
• reviewing the external auditors scope of work in relation to the 31 December 2011 year end audit;
• review and adoption of the Audit Committee’s Terms of Reference;
• review and adoption of a Policy for provision of non-audit services by the external auditor;
• review and adoption of a Whistle Blowing policy with direct reporting to the Secretary of the Audit Committee and the
Chairman of the Audit Committee;
• reviewing of all interested person transactions and a quarterly review of the register of interested person transactions
to ensure compliance with the Listing Manual and the BTA;
• reviewed management’s bi-annual evaluation of the external auditor in line with the Accounting and Corporate Regulatory
Authority guidance;
• approving the appointment of the Interim Chief Financial Officer and Interim Financial Controller; and
• review of the policy and procedure manual of the property manager.
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