GOOD CORPORATE GOVERNANCE

Internal Audit Unit

Pursuant to Bapepam – LK Rule No. IX.I.7 on the formation and Charter’s guidelines on Internal Audit Unit, the Company established an Internal Audit Unit on 7 December 2009. The Internal Audit Unit was established to improve the efficiency and effectiveness of the Company’s operations, including risk management governance. The Internal Audit Unit is neutral and operates independently from other business activities of the Company.

Stipulated in the Internal Audit Unit Charter, duties and responsibilities of the Internal Audit Unit include, among others, the development and execution of the Annual Internal Audit Plan – as well as the testing, evaluation and implementation of internal control and risk management system. The Internal Audit Unit also conducts evaluation and assessment of various key corporate functions including finance, accounting, operations, human capital, marketing and information technology. Another responsibility of the Audit Internal Unit is to conduct Investigative Auditing if deemed necessary to protect the Company’s interest.

The Internal Audit Unit monitors, analyzes and reports the Follow-Up Auditing process to ensure that all internal audit findings and related recommendations are properly addressed. The Unit directly reports to the President Director on its responsibilities, the Internal Audit Unit works closely with the Audit Committee.

Independency, integrity, honesty and objectivity, as well as the quality of audit implementation are always upheld based on Code of Ethics by the Internal Auditor. All audit results are submitted to the organizational unit to be evaluated – as well as the President Director and Board of Commissioners.

Trisnowibowo

Indonesian citizen, born in 1959, Mr. Trisnowibowo is currently an Internal Auditor for MAP. Prior to joining MAP, Mr. Trisnowibowo held various executive positions at Indonesian Financial and Development Supervisory Agency (1983 – 2000) and Department of Finance – Directorate General for State Financial Monitoring (1981 – 1983). He earned his Master of Business Administration Degree from University of New Brunswick, and his Diploma IV Degree from State College of Accountancy (STAN).

Appointment of the Internal Audit Unit is based on the President Director’s Decree No. 001/PERS/KET/ MAP/I/2016 dated 3 January 2016. His appointment as Chairman of the Internal Audit Unit is based on his academic background and professional experiences in related fields.

The Internal Audit Unit did not attend any training/competence development program in 2022

Review of Internal Audit Effectiveness

Our internal audit activities in 2022 included review of MAP stores and Warehouse for: Inventory / Merchandise, Cash Count (Petty Cash and Cash Register), Fixed Asset, Gift Vouchers (for stores selling Gift Vouchers) and General Store Operations such as the condition of stores, grooming of store staff and administration in the stores. In total, we conducted an average of two to three internal audits for stores and one for Warehouse in 2022. These audits were conducted without prior notice to minimize fraud, and additional audits were conducted for stores to minimize stock losses.

Follow up investigations were conducted for variance of stocks and the stores responsible for the missing stocks. To ensure better transparency and accountability, additional audits were conducted at the request of management as and when required. The overall audit result in 2022 was satisfactory, in line with the Company’s expectation. Reviews of most stores were generally positive with strong customer engagement, but we are continually looking for ways to strengthen the Company’s internal control.

Internal Control

It is important for the Company to establish and consistently apply an internal control system in its business environment. For us, the internal control system is part of the governance infrastructure of the Company, which is established in order to prevent the fraud indication at the Company as well as to ensure the effective and efficient performance, including the reliability of the financial reporting, asset security, as well as regulatory compliance. The anticipative action is carried out through improvement and strengthening of internal control.