Internal audit

Internal audits are very important and needed by relatively large companies. Internal audits of the Company is required to test and evaluate the Company’s internal control system. Internal audits are conducted to assist the Company in overseeing the implementation of the Company’s internal control activities, including the Company’s compliance to the Article of Association and regulations to avoid possible irregularities. Internal audit report is used as recommendation for the Company to make future improvement.

Currently, the Internal Audit Division consists of four staff and headed by Drs. Bosse Gozali.

Internal Audit Charter

In order for the Internal Audit Division to carry out its duties and responsibilities in a competent, independent and accountable manner, the Internal Auditor shall based its action on the Internal Audit Charter which has been prepared and approved by the Board of Commissioners on 15 January 2009.

The drafting process of the Internal Audit Charter met Bapepam Regulation No.IX.I.7 on Establishment and Guidelines for Internal Audit Charter.

Internal Audit Charter describes the obligations, duties and responsibilities, as well as authority, relations with other parties as well as the code of conduct that must be followed by the Internal Auditor.

Responsibility of Internal Audit Division

1. Implementing annual work plan.
2. Carry out inspection in accordance with the Company’s internal control system.
3. Coordinate inspection activities with President Director on the achievement of goals and objectives of the company inspection.
4. Prepare audit report to be submitted to the President Director and the Board of Commissioners and follow up the findings of the audit results.
5. Follow up audit findings reported by internal audit section and consolidated with the Audit Committee to ensure that appropriate action has been taken and implemented by management.

Internal Audit Performance

During 2015, the Internal Audit Team has conducted operational audits throughout the unit/business units and several subsidiaries, as well as evaluation of the application of risk management in accordance with a predetermined schedule with 100% level of achievement.

AUDIT COMMITTEE

Audit Committee work guidelines

In performing its monitoring function, the Board of Commissioners is supported by Audit Committee. The supporting activity refers to Audit Committee Charter, pursuant to POJK No. 55/POJK0.4/2015 on the Establishment and Work Implementation Guideline of Audit Committee. The Audit Committee is directly responsible to the Board of Commissioners.

Appointment and dismissal of Audit Committee members

Audit Committee is appointed and dismissed by the Board of Commissioners Audit Committee is chaired by a Board of Commissioners member and two professional members from outside the Company with adequate background in the sectors that support the Company’s industry. Audit Committee works professionally and independently in performing its duty.

Description of the Nomination and Remuneration procedures, if not established by the Nomination and Remuneration Committee

Until now, the Company had not established a Nomination and Remuneration Committee to support the monitoring function of the Board of Commissioners. Therefore, the nomination and remuneration function is still conducted by the Board of Commissioners until now, with the GMS permission.

The nomination and remuneration procedures conducted by the Board of Commissioners  are as follows:

1. Evaluate the performance of the Board of Commissioners and Board of Directors;
2. Draft up skill development program of the Board of Commissioners and Board of Directors; and
3. Draft up remuneration structure, policy and amount for the Board of Commissioners and Board of Directors.