Annual Report 2021

Corporate Governance Report 42 CHINA MERCHANTS PORT HOLDINGS COMPANY LIMITED 4. to monitor integrity of the Company’s financial statements and annual report and accounts, half- year report and, if prepared for publication, quarterly reports, and to review significant financial reporting judgments contained in them. In reviewing these reports before submission to the Board, the Audit Committee should focus particularly on: (i) any changes in accounting policies and practices; (ii) major judgmental areas; (iii) significant adjustments resulting from audit; (iv) the going concern assumptions and any qualifications; (v) compliance with accounting standards; and (vi) compliance with the Listing Rules and legal requirements in relation to financial reporting; 5. regarding to item (4) above: (i) members of the Audit Committee must liaise with the Board and senior management and the Audit Committee must meet, at least twice a year, with the Company’s auditor; and (ii) the Audit Committee should consider any significant or unusual items that are, or may need to be, reflected in the report and accounts, it should give due consideration to any matters that have been raised by the Company’s staff responsible for the accounting and financial reporting function, compliance officer or auditor; 6. to review the Company’s financial controls and risk management and internal control systems; 7. to discuss the risk management and internal control systems with management to ensure that management has performed its duty to have an effective systems. This discussion should include the adequacy of resources, staff qualifications and experience, training programmes and budget of the Company’s accounting and financial reporting function; 8. to consider major investigation findings on risk management and internal control matters as delegated by the Board or on its own initiative and management’s response to these findings; 9. to discuss problems and reservations arising from the interim and final audits, and any matters the auditor may wish to discuss (in the absence of management where necessary); 10. to review the external auditor’s management letter, any material queries raised by the auditor to management about accounting records, financial accounts or systems of controls and management’s response; 11. t o r e v i ew t he Company ’ s s t a t emen t on r i s k management and internal control systems (which is included in the annual report) prior to endorsement by the Board; 12. where an internal audit function exists, to review the internal audit programme, to ensure co-ordination between the internal and external auditors, and to ensure that the internal audit function is adequately resourced and has appropriate standing within the Company, and to review and monitor its effectiveness; 13. to ensure that the Board will provide a timely response to the issues raised in the external auditor’s management letter;