The Audit Committee was formed to assist the Board of Commissioners in carrying out its supervisory function and has a strategic role in monitoring the effectiveness of internal controls, financial statements and external auditors, as well as reviewing the Company's financial information and the implementation of audits by internal auditors.

Composition of Audit Committee Membership

Audit Committee members are appointed by the Board of Commissioners based on criteria such as independence, expertise, experience, and integrity, as mandated by regulation. In 2023, the Company's Audit Committee consists of 3 (three) members and is chaired by an Independent Commissioner who was appointed based on the Decree of the Board of Commissioners No. 003/IX/2023-BOC.MPPA dated September 4, 2023.

Independence of the Audit Committee

In accordance with the stipulations of OJK Regulation No. 55/POJK.04/2015, outlining the Establishment and Work Guidelines of the Audit Committee, and as outlined in the Audit Committee Charter, independence is defined as the absence of family relationships up to the second degree, business associations, or other connections with (other) Commissioners, Directors, or the majority shareholder. Additionally, members should not hold any shares in the Company. To adhere to POJK requirements, the Chair of the Audit Committee is designated as an Independent Commissioner.

Audit Committee Charter

The Audit Committee Charter has been recently updated and received approval from the Board of Commissioners on April 21, 2023 that covers the following aspects:

1. Legal Basis
2. Function
3. Structure
4. Membership Requirement
5. Duties and Responsibilities
6. Authority
7. Meetings
8. Reporting
9. Term of Office
10. Procedures for Replacing Members
11. Salary and Facilities
12. Work Values

Duties and Responsibilities of the Audit Committee

The duties and responsibilities of the Audit Committee, as stipulated in the Audit Committee Charter, include, but are not limited to:

1. Reviewing the financial information to be disclosed by the Company, which includes financial reports, projections, and other financial details;
2. Ensuring the Company’s compliance with regulations and legislation pertinent to its activities;
3. Offering independent opinions in cases of disagreements between management and the Public Accounting Firm regarding provided services;
4. Providing recommendations to the Board of Commissioners concerning the appointment of a Public Accounting Firm, considering factors such as independence, scope of assignment, and audit fees;
5. Evaluating the execution of internal audit examination and overseeing the implementation of follow-up actions by the Board of Directors in response to internal auditor findings;
6. Reporting to the Board of Commissioners on various risks faced by the Company and the Board of Directors’ implementation of risk management;
7. Reviewing and reporting to the Board of Commissioners on complaints related to the Company;
8. Assessing the implementation of risk management activities by the Board of Directors;
9. Examining complaints related to the Company’s accounting and financial reporting processes;
10. Offering advice to the Board of Commissioners on potential conflicts of interest involving the Company; and
11. Upholding the confidentiality of Company documents, data, and information.

Authority of the Audit Committee

In order to carry out its duties effectively, the Audit Committee possesses the authority to access all financial reports, internal audit findings, and minutes of Board of Directors meetings, as well as Company’s information and records related to staff, funds, assets, and other resources. If necessary, the Audit Committee can communicate directly or indirectly with Management, Company staff, the Internal Audit Unit, and External Auditors.

Audit Committee Meeting

The Audit Committee holds at least one meeting every quarter, with the requirement that at least half of the Committee members attend each meeting. Minutes of every meeting must be documented and subsequently reported to the Board of Commissioners. For the year 2023, the Audit Committee will hold four meetings.

Audit Committee Statement on the Effectiveness of the Internal Control System of The Company

Internal control system was evaluated to have operated effectively and sufficiently throughout 2023, as proven by the effectiveness of the internal control function, including the internal audit function, risk management, compliance, financial control, and operations.

Audit Committee Report 2023

Throughout 2023, the Audit Committee has carried out its duties and responsibilities referring to the Audit Committee Charter, the direction of the Board of Commissioners and applicable laws and regulations, as follows:

1. Review the Annual Financial Report for Fiscal Year 2022, quarterly and mid-year financial reports for Fiscal Year 2023, financial projections and other financial information from the Company;
2. Evaluate the performance of Public Accountants (AP) and Public Accounting Firms (KAP) who audited the Company’s Annual Financial Report for the 2022 Fiscal Year;
3. Conduct assessments and provide input to the Board of Commissioners in appointing AP and KAP recommended by the Board of Directors to audit the Company’s Annual Financial Report for the 2023 Financial Year;
4. Review audit findings and implement audit recommendations;
5. Review the effectiveness of the Company’s internal controls;
6. Review the Company’s level of compliance with laws and regulations in the capital market sector and other laws relating to the Company’s activities.

In carrying out the above review, in addition to observing the Financial Reports, Internal Audit audit reports and Minutes of Meetings of the Company’s Directors, the Audit Committee also observes accounting procedures and policies, tests the effectiveness of integrated supervision in operational activities and observes and carries out intensive discussions with Management, Internal Company Audit and External Auditor. In the fulfillment of its responsibility to disclose its examination results to the Company’s Annual Report for the financial year ending 31 December 2023, the Audit Committee herewith reports that:

1. The Company’s business activities have been conducted under effective internal control, whose quality has been continually improved in accordance with the policies set by the Directors and under the supervision of the Board of Commissioners;
2. The financial report has been properly prepared and presented in accordance with generally accepted accounting principles in Indonesia;
3. The Company consistently adhered to capital market laws and regulations, as well as other laws pertaining to its operations;
4. The appointment of AP and KAP for the 2023 fiscal year, as recommended by the Board of Directors, is carried out with due consideration given to independence and competence. The appointments are subsequently approved by the Board of Commissioners, who have been vested with authority by the Shareholders at the Annual General Meeting held on April 19, 2023;
5. No potential of the abuse of authority or misconduct have been identified which need the attention and the consideration of the Company’s Board of Commissioners.

Audit Committee Profile