Contents 1 ANNUAL REPORT BERHAD MELAYU TANAH KERETAPI 03 Corporate Information 22 Audit Committee Report Chairman’s Statement 04 Board of Directors 27 2012 Rationale 10 Statement On Corporate Governance 34 Review of Operation 17 Statement On Internal Control 40 Corporate Calendar 19 Statement On Risk Management 45 Financial Statements KTMB has provided new Electric Train Services (ETS) and Six Car Set (SCS) services using modern technology and continuous improvement. It is focused on providing comfort to the passenger. KTMB’s Mission Be the preferred land transportation system by providing safe, efficient and reliable integrated rail services for people and goods. We will: • Be competitive and responsive to market needs. • Achieve our goals through a highly trained and motivated workforce using modern technology and process innovation. • Provide reasonable profit and longterm growth to shareholders. Corporate Information Chairman Registered Office Y.B. Dato’ Sri Ir. Mohd Zin bin Mohamed Ibu Pejabat Korporat KTM Berhad Jalan Sultan Hishamuddin 50621 Kuala Lumpur President Malaysia Datuk Elias bin Kadir Tel : +603 2263 1111 www.ktmb.com.my Directors Pn. Norazura binti Tadzim Auditors Pn. Ruhaizah binti Mohamed Rashid Deloitte KassimChan En. Selvarajoo a/l Manikam Dato’ Sri Zakaria bin Hj. Bahari Tn. Hj. Rosli bin Abdullah En. Harun bin Hj. Johari Datuk Kamaruzaman bin Hj. Mohd Noor Sr. Ahmad Zainuddin bin Hj. Jamaluddin Board Of Directors Board Of Directors 5 4 ANNUAL REPORT BERHAD MELAYU TANAH KERETAPI 2012 2012 ANNUAL REPORT KERETAPI TANAH MELAYU BERHAD MELAYU TANAH KERETAPI Y.BHG. DATUK ELIAS BIN KADIR Y.BRS. PUAN NORAZURA BINTI TADZIM President Non-Independent Non-Executive Director Y.Bhg. Datuk Elias Kadir, was appointed to the Board on Y.Brs. Puan Norazura binti Tadzim, was appointed to the Board 2 May 2012. He was formerly the Chief Executive Officer of on 1 July 2011. Y. Brs. Puan Norazura’s present position is Multimodal Freight Sdn. Bhd. Since his appointment, he has the Principal Assistant Secretary at the Investment, Minister of attended 10 out 10 Board meetings held during the financial Finance Incorporated and Privatisation Section of the Ministry year. He has no family relationship with any director. He has no of Finance. She attended 13 out of the 15 Board meetings held conflict of interest with KTMB and has never been charged for during the financial year. She has no family relationship with any offence. any director. She has no conflict of interest with KTMB and has never been charged for any offence. Y.B. DATO’ SRI IR. MOHD ZIN BIN MOHAMED Y.B. Dato’ Sri Ir. Mohd Zin bin Mohamed, was appointed to Chairman of the Board the Board as its Non-Executive Chairman on 1 October 2009. Y.B. Dato’ Sri Ir. Mohd Zin was a former Cabinet Minister holding the portfolio of Minister of Works. He attended 14 out of the 15 Board meetings held during the financial year. He has no family relationship with any director. He has no conflict of interest with KTMB and has never been charged for any offence. Board Of Directors 7 6 ANNUAL REPORT BERHAD MELAYU TANAH KERETAPI 2012 2012 ANNUAL REPORT KERETAPI TANAH MELAYU BERHAD MELAYU TANAH KERETAPI Y.BRS. PUAN RUHAIZAH BINTI MOHAMED RASHID Y.BRS. ENCIK SELVARAJOO A/L MANIKAM Y.BHG. DATO’ SRI ZAKARIA BIN HJ. BAHARI Y.BRS. TUAN HAJI ROSLI BIN ABDULLAH Non-Independent Non-Executive Director Non-Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director Y. Brs. Puan Ruhaizah binti Mohamed Rashid, was appointed Y.Brs. Encik Selvarajoo a/l Manikam, was appointed to the Y.Bhg. Dato’ Sri Zakaria bin Hj. Bahari, was appointed to the Y.Brs. Tuan Haji Rosli bin Abdullah, was appointed to the to the Board on 9 November 2011. At present, Y. Brs. Puan Board on 16 December 2009. Y. Brs. Encik Selvarajoo is Board on 25 February 2010. He was formerly the Secretary Board on 20 July 2010. He was formerly the Chief Executive Ruhaizah is the Deputy Secretary General (Planning) at the currently a Director at the Economic Council Secretariat of General of the Ministry of Transport. He attended 11 out of the Officer/Registrar of the Malaysian Institute of Accountants. Ministry of Transport. She attended 12 out of the 15 Board the Economic Planning Unit. He attended 13 out of the 15 15 Board meetings held during the financial year. He has no He attended 14 out of the 15 Board meetings held during the meetings held during the financial year. She has no family Board meetings held during the financial year. He has no family family relationship with any director. He has no conflict of interest financial year. He has no family relationship with any director. relationship with any director. She has no conflict of interest relationship with any director. He has no conflict of interest with with KTMB and has never been charged for any offence. He has no conflict of interest with KTMB and has never been with KTMB and has never been charged for any offence. KTMB and has never been charged for any offence. charged for any offence. Board Of Directors 9 8 ANNUAL REPORT BERHAD MELAYU TANAH KERETAPI 2012 2012 ANNUAL REPORT KERETAPI TANAH MELAYU BERHAD MELAYU TANAH KERETAPI Y.BRS. SR. AHMAD ZAINUDDIN BIN HJ. JAMALUDDIN Y.BRS. ENCIK HARUN BIN HJ. JOHARI Y.BHG. DATUK KAMARUZAMAN BIN HJ. MOHD NOOR Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director Y.Brs. Sr. Ahmad Zainuddin bin Hj. Jamaluddin, was appointed Y.Brs. Encik Harun bin Hj. Johari, was appointed to the Y.Bhg. Datuk Kamaruzaman bin Hj. Mohd Noor, was appointed to the Board on 27 April 2012. He was formerly an Executive Board on 20 July 2010. At present, Y. Brs. Encik Harun is to the Board on 12 September 2011. He was formerly the Director at DK Binajaya Sdn. Bhd. Since his appointment, the Managing Director/Group Chief Executive Officer at the Deputy Secretary General (Planning) at the Ministry of Transport. he has attended 9 out of 10 Board meetings held during the Malaysian Agrifood Corporation Berhad and Cold Chain He attended all 15 Board meetings held during the financial financial year. He has no family relationship with any director. Network (M) Sdn. Bhd. He attended 11 out of the 15 Board year. He has no family relationship with any director. He has no He has no conflict of interest with KTMB and has never been meetings held during the financial year. He has no family conflict of interest with KTMB and has never been charged for charged for any offence. relationship with any director. He has no conflict of interest with any offence. KTMB and has never been charged for any offence. Statement On Corporate Governance Statement On Corporate Governance 11 10 ANNUAL REPORT BERHAD MELAYU TANAH KERETAPI 2012 The Board recognizes the importance of corporate governance Together with the Managing Director/President who (iv) Appointments to the Board rotation pursuant to Article 104 and being eligible, 2012 ANNUAL REPORT in discharging its responsibilities, protecting and enhancing has in-depth knowledge of the Group’s business, offer them for re-election. shareholders’ value through promoting and practising high the Board is constituted of individuals who are The Board believes that the current composition standards of corporate governance throughout the Group. The committed to business integrity and professionalism of the Board comprises the required mix of skills (vi) Meetings Board adopts and applies the principles and best practices as in all its activities. The Board supports the highest and core competencies required for the Board to KERETAPI TANAH MELAYU BERHAD MELAYU TANAH KERETAPI governed by the Malaysian Code on Corporate Governance standards of corporate governance and the discharge its duties effectively. The Board meets regularly on a monthly basis or as 2012 (“Code”) and the ‘Green Book’ on Enhancing Board development of best practices for the Group. and when required. There were fifteen (15) meetings Effectiveness set by the Putrajaya Committee on GLC High The Board delegated to the Nomination and held during the financial year and the attendance Performance. (iii) Supply of Information Remuneration Committee the responsibility of record is as follows:- recommending the appointment of new Directors. The following statements set out the Group’s compliance The Directors whether as full Board or in their New appointees will be considered and evaluated Meetings with the principles of the Code:- individual capacity, have full and unrestricted by the Board and the Secretary will ensure that all Attended Dato’ Sri Ir. Mohd Zin bin access to all information within the Group and direct appointments are properly made, and that legal and 14/15 Mohamed A. DIRECTORS access to the advice and services of the Secretary regulatory obligations are met. Datuk Elias bin Kadir * 10/10 who is responsible for ensuring that Board meeting (i) The Board procedures are followed and that applicable rules The Nomination and Remuneration Committee also Pn. Norazura binti Tadzim 13/15 Pn. Ruhaizah binti Mohamed and regulations are complied with. At each meeting annually reviews the effectiveness of the Board as 12/15 Rashid The Group recognises the important role played by of the Board, the Secretary appraises the Board on a whole, its committees and the contribution of the Board in the stewardship of the Group’s direction the Group’s compliance obligations and highlights each individual Director, as well as the President. En. Selvarajoo a/l Manikam 13/15 and operations, and ultimately, the enhancement non-compliances with legal, regulatory and statutory The Nomination and Remuneration Committee will Dato’ Sri Zakaria bin Hj. Bahari 11/15 of long-term shareholders’ value.