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The Company affirms its commitment to a comprehensive and accountable internal control system, encompassing all policies and procedures across financial and operational functions. This system is designed to safeguard the Company’s assets, ensure the reliability of financial reporting and information, and guarantee compliance with applicable regulations. In addition, the internal control system supports effective and efficient operations, while enhancing transparency, accuracy, and accountability in every business decision. Through continuous evaluation and enhancement, this system serves as a key pillar of supervision that supports the achievement of performance objectives, minimizes risks, and increases value for all stakeholders, while also serving as the foundation for long-term business sustainability.
The implementation of the Company’s internal controls is under the supervision of the Audit Committee. It serves as one of the benchmarks for the implementation of GCG principles, which focusing on three main aspects: financial controls, operational controls, and the reliability of reports and information. Financial controls focus on the timely, transparent, accurate, and accountable presentation of information in accordance with prevailing accounting standards. Meanwhile, operational control aims for efficiency, effectiveness, and compliance with all applicable regulations and laws.
The success of the internal control system is supported by comprehensive risk management, professional human resource management, an integrated information and communication system, as well as monitoring and evaluation mechanisms applied across all units and levels of the organization. The separation of functions is strictly enforced to prevent errors, fraud, and inefficiencies, ensuring that no individual controls the entire transaction cycle from initiation to completion.
Every event and transaction must be authorized clearly and performed by authorized employees, in accordance with the Board of Directors’ decrees and the provisions of laws and regulations. Through this mechanism, the Company ensures that all financial and operational activities are lawful, valid, transparent, and compliant, thereby positioning financial and operational control a key pillar of corporate governance.
The Company affirms its commitment to effective risk management and governance through the implementation of an internal control system based on the COSO (The Committee of Sponsoring Organizations of the Treadway Commission) framework. This system comprises five main components, namely control environment, risk assessment, control activities, information and communication, and monitoring, which are consistently applied for operational reliability, compliance, and the achievement of the Company’s strategic objectives.
The Company places internal control as the main foundation of effective and sustainable governance. Throughout 2025, the Audit Committee, together with the Internal Audit Unit, systematically reviewed, strengthened, and refined policies and procedures across all business lines, ensuring the integrity of financial reports and smooth operations.
The review results indicate that the Company’s internal control system is functioning optimally, with no significant weaknesses identified that could affect the operational performance or reporting accuracy. This approach has also enhanced the Company’s ability to proactively identify and mitigate risks, while strengthening its readiness to address future strategic challenges, thereby supporting the achievement of targets and excellent corporate governance practices.
Throughout 2025, the Board of Commissioners and the Board of Directors assessed that the Company’s internal control system had been implemented effectively and adequately. Policies and procedures were implemented in accordance with SOPs, with each organ performing its functions in a disciplined manner and oriented on achieving the predetermined Key Performance Indicators (KPIs). This assessment confirms the adequacy of internal controls in supporting operational integrity, the reliability of financial reports, as well as sustainable and professional corporate governance practices.