The BOD shall establish an impartial sub-committee dedicated to audit and risk management, referred to as the “Audit and Risk Committee.” This committee shall operate independently from executive management. The main competencies of the committee include:

1. Monitor the integrity of the entity annual and semi-annual financial statements and their compliance with the accounting standards approved by the federal government and review them periodically.

2. Submit a recommendation to the BOD regarding the appointment, change, or renewal of the external auditor, and approval of the fees and appointment period thereof.

3. Continuously monitor the independence and objectivity of the external auditor and ensure that the scope of the audit process and its effectiveness are consistent with the accounting procedures and standards approved by the federal government.

4. Ensure that the external auditor submits his annual report to the BOD within a maximum of three (3) months from the end of the fiscal year or as of the date specified in the legislation establishing the entity, including the data and observations resulting from the audit and recommendations thereof.

5. Review the external auditor report (observations and gaps report) and ensure that the entity responds to any fundamental inquiries posed to it by the external auditor, regarding accounting records, financial accounts, control systems, or risks.

6. Work with the external auditor and ensure cooperation of the entity therewith to obtain all the information requested thereby and ensure coordination between the internal audit staff and the external auditor.

7. Submit a recommendation to the BOD regarding any additional work requested by the Executive Management from the external auditor and approve the financial compensation for such work without prejudice to its independence.

8. Review regulations, policies, and accounting procedures in the federal entity.

9. Review reports of financial control, internal control, internal audit management and risk management systems.

10. Initial investigation into any financial or other violations and ensuring that the necessary standards are established as a result of those investigations, as well as considering the results of the main investigations into internal control issues assigned thereto by the BOD.

11. Cooperate with the UAE Accounting Authority and ensure that the notes contained in its report are responded to by the executive management and presented to the BOD.

12. Ensure the quality and efficiency of the entity internal audit system and its compatibility with applicable legislation.

13. Approve the work implementation requirements determined by internal audit, including human resources, the type of skills required, and the use of experts and consultants from an external party.

14. Conduct an annual evaluation of the effectiveness of internal audit and the extent to which its work conforms with the legislation and evidence adopted in this regard. The committee shall conduct an annual evaluation of the need for an internal audit office if it does not exist.

15. Discuss the internal control system with the BOD, and ensure that the entity performs its duty in establishing an effective internal control system in the federal entity.

16. Discuss the risk management system with the BOD, and ensure that the entity performs its duty in establishing an effective risk management system in the federal entity.

17. Follow up on setting controls that enable the entity employees and those dealing with it to report any potential violations in financial reports, internal control, or other matters confidentially, and provide systems that ensure independent and fair investigations of those violations.

18. Monitor the extent of the federal entity compliance with the rules of professional conduct in accordance with the Professional Conduct Document issued by the Federal Authority for Government Human Resources and any amendments thereto.

19. Any other powers and tasks assigned thereto by the BOD or the Chairman.