ENTERPRISE RISK MANAGEMENT

RISK MANAGEMENT POLICY

The Board recognizes the importance of identifying and controlling various risks to prevent undue and unintended negative impact on Asia Amalgamated Holdings Corporation (the "Company"). It also recognizes that risk oversight, implementation of comprehensive controls and assurance processes are part of its core functions.

Also, the Board has adopted risk policies and procedures to better manage risks of the Company, with the formation of a control framework to assists in identifying, assessing, monitoring and managing risks, so as to safeguard the assets and interest of the Company while ensuring the integrity of reporting.

BENEFITS

Listed are some of the benefits of using and implementing an Enterprise Risk Management framework:

  • More effective strategic and business planning;

  • More effective utilization of resources;

  • Better cost control;

  • Enhances stockholder value by minimizing loss and maximizing profits;

  • Increase knowledge and understanding of exposure to risks;

  • Increases preparedness for third-party/outside review resulting to more effective and less costly audits;

  • Minimizes business disruptions; and

  • Strengthens culture for continued improvement.

RISK MANAGEMENT PROCESS

The Company Enterprise Risk Management process comprises the following steps.

  1. IDENTIFY, that is to identify key risks.

  2. ANALYZE, consider the potential impact and likelihood of risks.

  3. RESPOND, act on the risks by considering existing controls as well as selecting, prioritizing and implementing appropriate actions.

  4. MONITOR, check the internal and external environment for potential changes to risks and ensure that the responses continues to operate effectively.

  5. REPORT, provide reports to the risks and the responses that were adopted.

RISK PROFILE

The Risk Profile of the Company contains both financial and non-financial, internal and external factors, including material risks arising from operational activities, operational efficiency and investments in new projects.

The Board recognizes that the Company's main business risks are determined by the nature of its business activities and that there are other factors that could influence the risk profile of the Company.

MINIMIZING POTENTIAL RISKS

OPERATIONAL RISK - in striving to manage such risks in the best possible way, the Company has introduced the following guidelines to minimize operational risks, by ensuring the following:

  1. All employees are aware and held accountable of their duties, roles and responsibilities;

  2. The Company appoints authorities based on skill and experience;

  3. All agreements are recorded and documents are safeguarded to substantiate dealings with external parties;

  4. The Company has in place insurance policies to minimize risk of loss through accidents or other adverse incidents;

  5. The Board received on a regular basis, reports of its operational activities for evaluation;

  6. The Company provides health and safety practices and training for its employees.

MINIMIZING EXTERNAL RISKS - the Board is aware that external risks, exposing the Company to financial loss are beyond control. To minimize external risks, the following guidelines have been initiated:

  1. Receiving regular reports on the market relating to prices, interest rates, foreign exchange and economic news;

  2. Constant monitoring of the supply and demand situation of the Company's primary products;

  3. Access to expert advice or research/studies on the direction of the prices of the Company's product.

RISK MANAGEMENT AWARENESS

Through this document, WE inform our employees of our basic approach to risk management and the rules to be followed and cite solid examples to strengthen their awareness of risk management and their ability to deal with risks. WE also hold education and training programs as appropriate on issues such as information, security, product consciousness, environmental problems and natural disasters.