Manulife US REIT - Annual Report 2021

ANNUAL REPORT 2021 131 MUST will comply with Rule 905 of the Listing Manual by announcing any interested person transaction in accordance with the Listing Manual if the value of such transaction, by itself or when aggregated with other interested person transactions entered into with the same interested person during the same financial year, is 3.0% or more of MUST’s latest audited net tangible assets. The aggregate value of all Related Party Transactions which are subject to Rules 905 and 906 of the Listing Manual in a particular financial year is disclosed on page 191 of the Annual Report. The ARC will periodically review all Related Party Transactions to ensure compliance with the Manager’s internal control system, the relevant provisions of the Listing Manual, and the Property Funds Appendix. The review will include the examination of the nature of the transaction and its supporting documents or such other data deemed necessary by the ARC. Audit Committee Principle 10 The Board has an Audit Committee which discharges its duties objectively. The ARC is governed by a set of written terms of reference approved by the Board, setting out its scope of authority and responsibilities in performing its functions. The ARC comprises three Directors, all of whom are Independent Directors resident in Singapore. The members bring with them invaluable recent and relevant managerial and professional expertise in accounting and related financial management domains. None of the ARC members are former partners of the incumbent external auditors, Ernst & Young LLP (EY). The ARC also does not comprise any member who has any financial interest in EY. The members of the ARC are: 1. Ms Veronica Julia McCann (Chairman) 2. Professor Koh Cher Chiew Francis 3. Mrs Karen Tay Koh The role of the ARC is to monitor and evaluate the adequacy and effectiveness of the Manager’s internal controls and risk management systems at least annually. The ARC also reviews the quality and reliability of information prepared for inclusion in financial reports and is responsible for the nomination of external auditors and reviewing the adequacy and effectiveness of external audits in respect of cost, scope and performance. The ARC’s responsibilities also include: • monitoring the procedures established to regulate Related Party Transactions, including ensuring compliance with the provisions of the Listing Manual relating to interested person transactions; • reviewing transactions constituting Related Party Transactions; • reviewing on an annual basis a report on conflict decisions regarding asset allocation, pursuant to the Sponsor’s allocation process; • deliberating on conflicts of interest situations involving MUST, including situations where the Manager is required to decide whether or not to take any action against any person in relation to any breach of any agreement entered into by the Trustee for and on behalf of MUST with a Related Party (as defined herein) of the Manager and where the Directors, controlling shareholders of the Manager and associates are involved in the management of or have shareholding interests in similar or related businesses as the Manager, and in such situations, the ARC will monitor the investments by these individuals in MUST’s competitors, if any, and will make an assessment whether there is any potential conflict of interest; • reviewing the results and scope of external audit reports to ensure that where deficiencies in internal controls have been identified, appropriate and prompt remedial action is taken by the management;