HKR International Limited (HKR INT'L) has released an updated Terms of Reference for its Audit Committee (AudCom), effective 25 March 2026, detailing expanded responsibilities, meeting protocols and authority to reinforce governance and risk management.

Key structural provisions • Formation & composition: Established on 17 July 1998, the AudCom must maintain at least three non-executive directors with a majority of independent non-executive directors (INEDs). The Board appoints an INED as chairman. • Quorum & meetings: A minimum of two members forms a quorum, with resolutions passed by majority vote. The committee will meet no fewer than twice per financial year, and the external auditor may request additional meetings. • Attendance: The finance director, head of internal audit and external auditor normally attend, while other Board members may be present. Private sessions with the external auditor can be convened when deemed necessary.

Enhanced authority • Investigation power: The AudCom is authorised to investigate any activity within its remit and require information from any employee. • External advice: It can obtain independent professional advice and secure external expertise when necessary.

Expanded duties 1. External auditor oversight – Recommends appointment, re-appointment or removal of the external auditor and approves remuneration and engagement terms. – Reviews auditor independence, objectivity and audit effectiveness. – Implements policy governing non-audit services.

2. Financial reporting review – Monitors integrity of annual, half-year and, if prepared, quarterly financial statements, focusing on accounting policy changes, major judgemental areas, significant adjustments, going-concern assumptions and compliance with Hong Kong Listing Rules and accounting standards. – Meets at least twice yearly with the external auditor to discuss significant or unusual items raised by management, compliance officers or the auditor.

3. Risk management and internal controls – Reviews financial controls, risk management and internal control systems, including Environmental, Social and Governance (ESG) risks. – Assesses management’s ongoing monitoring processes, resource adequacy, staff qualifications and training for both financial reporting and ESG functions. – Ensures coordination between internal and external auditors and evaluates internal audit effectiveness.

4. Additional responsibilities – Examines major investigation findings and management responses. – Reviews the external auditor’s management letter and ensures timely Board responses. – Oversees whistle-blowing arrangements for confidential reporting of improprieties. – Acts as the key liaison body between the company and its external auditor.

Reporting procedures Draft and final meeting minutes are circulated to all AudCom members and distributed to non-committee Board members for record-keeping.

The updated charter underscores HKR INT'L’s commitment to stronger audit independence, enhanced ESG risk monitoring and improved transparency in financial reporting.