c) A structured budgeting process whereby operating units prepare annual budgets for review and approval at the appropriate management level and by the Board; d) Q uarterly monitoring of financial and operational results by Management, with appropriate corrective actions taken where required; e) R egular visits to reporting units by the management team and, where deem appropriate, the Board. f) A revised revenue recognition procedure requiring customer certification or equivalent milestone evidence of work performed before revenue and contract assets are recognised, with independent review by the Group Finance prior to the close of each reporting period; g) M onthly review of contract asset and trade receivable ageing by the Chief Financial Officer, including assessment of recoverability, ECL provisioning and follow-up of overdue balances, with quarterly reporting to the AC; h) A formal period-end financial close checklist, including reconciliation of subsidiary reporting packages to the consolidated financial statements and review of significant judgements and estimates by the Chief Financial Officer before submission to the Audit Committee; and i) E nhanced GIAD coverage of revenue, contract management and financial reporting processes at the subsidiaries in the FY2026 and FY2027 audit plans. These measures are intended to strengthen the Group’s control environment, improve oversight and accountability, and support the early identification and timely remediation of control weaknesses. BOARD RESPONSIBILITY The Board is responsible for maintaining a sound system of internal controls and for reviewing its adequacy and integrity. It includes not only financial controls but operational and compliance controls. Due to the limitations inherent in an internal control system, management has implemented an internal control system designed to manage rather than eliminate the risk that may impede the achievement of the Group's business objectives. MANAGEMENT RESPONSIBILITY Management is responsible for implementing the strategies approved by the Board and overseeing the Group’s day-to-day operations. The Group’s organisational structure establishes clear segregation of duties, reporting lines, accountabilities and levels of authority to support effective management and independent stewardship. The management assists the Board in implementing approved policies and strategies, establishing appropriate risk control procedures, and developing, implementing and monitoring internal controls to identify, manage and mitigate risks affecting the Group’s operations and objectives. INTERNAL AUDIT RESPONSIBILITY The Group Internal Audit Department ("GIAD") function was set up by the Board to provide independent assurance of the adequacy of risk management, internal control and governance systems. GIAD activities are guided by an Internal Audit Charter which is approved by the Audit Committee ("AC"). The Group's internal audit function undertakes regular reviews of the Group's operations and its system of internal control. The audit plan is developed based on the risk profiles of the Group business. Internal audit findings are discussed at management level and actions are agreed in response to the internal audit recommendations. The progress of implementation of the agreed actions is being monitored by GIAD through follow-up reviews. GOVERNANCE DESTINI BERHAD 103 ANNUAL REPORT 2026
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