Internal Audit

Internal Audit Unit is a part of the Company’s internal control, which broadly aims to help management realizing its goals through adequate checking to the implementation of internal control, risk management, and corporate governance processes. The Company has established an Internal Audit Unit in accordance with OJK Regulation No. 56/ POJK.04/2015 concerning the Establishment and Guidelines for the Preparation of the Internal Audit Unit Charter and the Securities Exchange Registration Regulations.

There were no changes in composition of the Internal Audit Unit in 2023.

APPOINTMENT AND DISMISSAL OF THE HEAD OF INTERNAL AUDIT UNIT

The appointment and dismissal of the Head of Internal Audit Unit has been regulated in the Company’s Internal Audit Unit Charter. Based on the Internal Audit Unit Charter, the head of the Internal Audit Unit is appointed and dismissed by the President Director with the approval of the Board of Commissioners and reported to OJK.

HEAD OF INTERNAL AUDIT UNIT PROFILE

Joni Susanto Agus was appointed as the Head of Company’s Internal Audit Unit based on the Board of Directors Decree Number: 002/SM/SKDIR/VI/2022 dated June 30, 2022, and the Board of Commissioners Approval Number: 001/SP-DEKOM/ VI/2022 dated June 28, 2022.

ORGANIZATIONAL STRUCTURE AND POSITION OF THE INTERNAL AUDIT UNIT

The Internal Audit Unit structurally provides accountability reports to the President Director and functionally has direct communication access to the Audit Committee to collaborate, coordinate, and deliver information related to audit implementation and results. The Internal Audit Unit also has communication access to all units in the Company to request information, clarification, and files or reports related to internal audit activities. As of the end of 2023, the Internal Audit Unit comprised 5 (five) personnel, consisting of 1 (one) Head of the Internal Audit Unit and 4 (four) members.

PROFESSIONAL EXPERTISE AND REQUIREMENTS

The complete qualifications and requirements of the Internal Audit Unit members are listed in the Company’s Internal Audit Charter, as per FSA Regulation 56 Article 6, Internal Auditor in the Internal Audit Unit must fulfil the following qualifications:

1. Have integrity and behavior that is professional, independent, honest, and objective while carrying out their duties.
2. Have knowledge and experience regarding audit techniques and other scientific disciplines relevant to their field of work.
3. Have knowledge on applicable laws and regulations on Capital Market and other pertinent laws and regulations
4. Have good communications skill, verbal and written
5. Comply with professional standards issued by the internal audit association.
6. Comply with the internal audit code of conduct.
7. Keep and maintain the confidentiality of information and/or data relating to the performance of duties and responsibilities of Internal Audit unless required by applicable laws and regulations or pursuant to court ruling
8. Understand the principles of good corporate governance and risk management.
9. Willingness to continuously improve and expand knowledge, professional skills and expertise.

PROFESSIONAL CERTIFICATION OF INTERNAL AUDIT UNIT

To continually improve the quality and competence of the Internal Audit Unit, the Company conducts a systematic and tiered competency development program. The program is carried out by involving the Company’s internal auditors in the certification program.

The following are the certifications owned by Internal Audit Unit officials:

• Qualified Internal Auditor (QIA) from Yayasan Pendidikan Internal Audit

The members of the Internal Audit Unit who have received certification is 1 (one) personnel, or 20% of the total number of employees of the Internal Audit Unit of 5 (five) personnel.

The Company is committed to continually improving the quality of internal audit within the Company, by gradually increasing the level of certification of the Internal Audit Unit’s employees over the next few years.

CHARTER OF THE INTERNAL AUDIT UNIT

The Internal Audit Unit has an Internal Audit Charter as a working guide in carrying out its duties. The Internal Audit Charter was issued on June 18, 2013, and was last updated on June 28, 2022.

Matters contained in the Internal Audit Unit Charter are:

1. Definitions,
2. Mission,
3. Purposes,
4. Core Principles,
5. Structure and Position,
6. Members,
7. Requirements and Qualifications of Internal Auditors,
8. Scope,
9. Tasks and Responsibilities,
10. Authorities,
11. Independence, Objectivity and Professionalism,
12. Proficiency, Due Professional Care, and Continuing Professional Development,
13. Code of Conduct, and
14. Reporting Activities.

Download: Internal Audit Charter 2022 (PDF, 11MB)

DUTIES AND RESPONSIBILITIES OF INTERNAL AUDIT UNIT

Based on the Internal Audit Unit Charter, the Internal Audit Unit has general duties and responsibilities which include, but are not limited to, the following:

1. To prepare risk-based annual internal audit plan, manpower planning, and budget of the Internal Audit Unit to be approved by the President Director and Audit Committee. In the case of significant variation, change, or modification to the plan submitted, the Head of the Internal Audit Unit will submit the revised plan to the President Director and Audit Committee,
2. To assess the adequacy, examine and evaluate the internal control and risk management system according to Company policy,
3. To assess the effectiveness and efficiency of the control procedures mainly in finance, accounting, operations, human resources, marketing, information technology and other activity,
4. To provide suggestions for improvements and objective information about the activities examined at all levels of management,
5. The Internal Audit Unit is responsible for the reporting of performance and audit findings to President Director and the Board of Commissioners through the Audit Committee,
6. To monitor, analyze and report the performance of corrective follow up as recommended,
7. The Internal Audit Unit will work together with the Audit Committee so that Audit Committee will perform its role in accordance with the applicable regulations,
8. To prepare the program to evaluate the quality of internal audit,
9. To perform special audit if required.
10. The Internal Audit Unit is responsible for performing ad-hoc assignment assigned by President Director or Audit Committee in so far as the assignment does not bear conflict of interest with respect to the said adhoc assignment,
11. The Head of Internal Audit will assess the staff’s skills, understanding, and knowledge in relation to the audit performed. If the Internal Audit Unit lacks the skills, understanding, and adequate knowledge for certain required matters, the Head of the Internal Audit Unit will report to the President Director, and the Audit Committee will appoint an independent third party.

In performing its duties, the Internal Audit Unit evaluates the internal control system, risk management, and corporate governance so the Company can achieve its objectives effectively and efficiently.

SUMMARY OF INTERNAL AUDIT UNIT ACTIVITIES IN 2023

In 2023, The Internal Audit Unit conducted activities including:

1. Executed the Annual Internal Audit Plan.
2. Conducted reviews on the effectiveness of the internal control system, risk management system, and corporate governance practices, and evaluated the efficiency and effectiveness of the Company's operations.
3. Presented and discussed internal audit reports with the Audit Committee, the Board of Directors, and senior management.
4. Monitored and ensured that corrective actions were implemented accurately and in a timely manner by the management.