ABOUT AGT AND TRUSTEE-MANAGER
Accordia Golf Trust ("AGT") is a business trust constituted in Singapore by a trust deed dated 16 June
2014 as amended by the first amending and restating deed dated 21 July 2014 (the "Trust Deed"), made
by Accordia Golf Trust Management Pte. Ltd., as trustee-manager of AGT (the "Trustee-Manager").
AGT is registered as a business trust under the Business Trusts Act, Chapter 31A of Singapore (the "BTA")
and was listed on the Main Board of Singapore Exchange Securities Trading Limited (the "SGX-ST") on
1 August 2014 ("Listing Date"). Accordia Golf Co., Ltd is the sponsor of AGT (the "Sponsor").
The Trustee-Manager is committed to high standards of corporate governance, business integrity and
professionalism in all its activities and has adopted corporate governance practices which are in line with the
Singapore Code of Corporate Governance 2012 (the "Code") throughout the financial year ended 31 March
2018. Where there are deviations from the Code, appropriate explanations have been provided. The Trustee-Manager
also ensures that all applicable laws, rules and regulations including the Securities and Futures Act,
Chapter 289 of Singapore (the "SFA"), the listing manual of the SGX-ST (the "Listing
Manual") and the BTA including the relevant regulations thereunder, are duly complied with.
THE BOARD'S CONDUCT OF ITS AFFAIRS
Every company should be headed by an effective Board to lead and control the company. The
Board is collectively responsible for the long-term success of the company. The Board works
with Management to achieve this objective and Management remains accountable to the Board.
The Board is responsible for the overall corporate governance of the Trustee-Manager. The Board oversees the Trustee-Manager's affairs and is accountable to Unitholders for the management of the Trustee-Manager, including establishing goals for the Management, monitoring the performance of the Trustee-Manager and overseeing the Management in order to monitor the achievement of these goals.
The Board meets regularly to review AGT's business activities and strategies and to provide entrepreneurial
guidance and strategic business direction. Such regular reviews are also aimed at ensuring adherence
to the Trust Deed and compliance with any applicable laws, rules, regulations, guidelines and policies.
The Board is also responsible for the risk management of AGT. All Board members participate in matters
relating to corporate governance, business operations and risks, financial performance, and the nomination
and review of directors of the Trustee-Manager ("Directors").
The Board has established a framework for the management of the Trustee-Manager and AGT, including
a system of internal controls and a business risk management process, which enables risks to be assessed
The key roles of the Board are to:
- guide the corporate strategy and directions of the Trustee-Manager;
- ensure that senior management discharges business leadership and demonstrates the highest quality
of management skills with integrity and enterprise; and
- oversee the proper conduct of the Trustee-Manager.
The Board is supported by two committees namely (1) Audit and Risk Committee and (2) Remuneration
Committee. These committees function within clearly defined terms of reference.
The Trustee-Manager has adopted a framework of delegated authorisations that has been approved
by the Board. The framework sets out the level of authorisation and their respective approval limits for
business activities, including but not limited to, investments and divestments, capital expenditures and
bank borrowings as well as arrangements in relation to cheque signatories. In addition, sub-limits are also
delegated to various management levels to facilitate operational efficiency. Activities and matters which
are specifically reserved for the Board's approval, such as acquisition and disposal of assets, financial
statements, annual budget, investment proposals and funding, opening and closing of bank accounts,
are also clearly set out in the framework.
Each Director acts honestly, with due care and diligence, and in the best interests of AGT. The Board
meets regularly, at least once every quarter, to review the business performance and outlook of AGT, as
well as to deliberate on business strategy, including any significant acquisitions, disposals, fund raising
and development projects of AGT. All Board meetings are scheduled in advance and ad-hoc meetings are
convened as and when warranted, when particular circumstances come to the Board's attention.
The number of meetings of the Board and the Board Committees during the year ended 31 March 2018
as well as the attendance of the Directors, are as follows:
The Trustee-Manager's Constitution permits Board meetings to be held by way of telephone or
videoconference or other methods of simultaneous communication by electronic or telegraphic means.
As part of continuous training, Directors will, from time to time, receive updates and briefing from professional advisors, auditors and Management on relevant practices, new rules and regulations, corporate governance, changes in accounting standards and risk management issues applicable or relevant to the performance of their duties and responsibilities as Directors. The Directors are encouraged to attend training courses from the Singapore Institute of Directors and any other relevant training programmes, so as to keep up-to-date with changes to financial, legal and regulatory requirements and the business environment. The Directors have attended courses on Directorship Fundamentals, Singapore Governance and Transparency Index, Remuneration Committee Essentials, What It Takes to be Effective. The cost of arranging and funding of the training of the Directors are borne by the Trustee-Manager. In an effort to familiarise the Directors with the business and operations of AGT Group, a visit to several of the Initial Portfolio golf courses was also arranged and these include Fujioka Golf Club, Kanra Country Club, Myogi Country Club, Village Higashi Karuizawa Golf Club, Kanetsu Highland Golf Club, Midono Country Club, Twin Lake Country Club, Northern Country Club Nishikigahara Golf Course, Shirasagi Golf Club, Kasai Country Club, Otsu Country Club, Lake Forest Resort. Meetings between the Management of the abovementioned golf courses and the Directors were also arranged so that the Directors can better understand the issues faced by the ground team.
BOARD COMPOSITION AND GUIDANCE
There should be a strong and independent element on the Board, which is able to exercise
objective judgement on corporate affairs independently, in particular, from Management and
10% shareholders. No individual or small groups of individuals should be allowed to dominate
the Board's decision making.
Section 14(2) of the BTA (read with Regulation 12 of the Business Trusts Regulations 2005 ("BTR")) states
that the board of a trustee-manager should consist of:
- at least a majority of directors who are independent from management and business relationships with the trustee-manager;
- at least one-third of directors who are independent from management and business relationships with the trustee-manager and from every substantial shareholder of the trustee-manager; and
- at least a majority of directors who are independent from any single substantial shareholder of the trustee-manager.
In addition to compliance with the BTA and BTR requirements, Board composition has been, and will
continue to be, based on merit that complements and expands the skills, experience and expertise of the
Board as a whole, taking into account the following principles:
- the Chairman of the Board should be a non-executive Director; and
- the Board should comprise Directors with a broad range of commercial and management experience,
including expertise in the golf course industry.
The composition of the Board and Board Committees is set out below:
Throughout the year, the composition of the Board complied with the BTR and also satisfied the Code's guidelines that there should be a strong and independent element on the Board, with at least one-third of the Board comprising Independent Directors. This enables Management to benefit from the external, diverse and objective perspectives of the Independent Directors when deliberating on issues that are brought before the Board. It also enables the Board to interact and work with Management through a robust exchange of ideas and views to help shape the strategic process.
The Board has conducted an annual review of the independence of the Independent Directors and has deemed them to be independent for the purposes of the BTA and Regulation 12 of the BTR. Each of Messrs Khoo Kee Cheok, Chong Teck Sin and Hitoshi Kumagai is independent from Management and business relationships with the Trustee-Manager, and independent from every substantial shareholder of the Trustee-Manager. All the Independent Directors are able to exercise independent judgement on the business activities of AGT. None of the Independent Directors have served beyond nine years.
Mr Toshikatsu Makishima resigned as Chief Operating Officer on 30 June 2018 following a job re-assignment by a seconding company, being a shareholder of the Trustee-Manager (the "Seconding Shareholder"). Consequent to his resignation as Chief Operating Officer, Mr Toshikatsu Makishima was re-designated as Non-Executive Director. He remains as a Non-Executive Director of the Trustee-Manager.
As at the date of this report, the Directors were as follows:
Mr Khoo Kee Cheok (Chairman)
Mr Chong Teck Sin
Mr Hitoshi Kumagai
Mr Yoshihiko Machida (Chief Executive Officer)
Mr Toshikatsu Makishima
The Board is of the view that the present Board size of five members is appropriate to provide for effective decision-making, taking into account the nature and scope of AGT's operations. Given the diverse qualifications, background, experience and profile of the Directors, the Board collectively possesses core competencies in areas such as accounting and finance, regulatory matters, risk management, business and management experience and also industry specific knowledge. As such, the Board is of the opinion that the current Board appropriately balances and retains a diversity of the relevant skills, experience and expertise for effective management of the Trustee-Manager and AGT.
There were no alternate Directors appointed during the year.
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
There should be a clear division of responsibilities between the leadership of the Board and the
executives responsible for managing the company's business. No one individual should represent
a considerable concentration of power.
To maintain an appropriate balance of authority, increased accountability and to ensure efficient decision-making, the roles and responsibilities of the Chairman and Chief Executive Officer ("CEO") are held by separate individuals. The Board Chairman is Mr Khoo Kee Cheok, an Independent Non-Executive Director. The CEO is Mr Yoshihiko Machida, who is an Executive Director. The Chairman and the CEO are not immediate family members.
There is a clear division of responsibilities between the Chairman and the CEO. As the Chairman, Mr Khoo Kee Cheok is responsible for leading and overseeing the Board to ensure that it acts in the best interests of AGT and that the Board meetings are planned and conducted effectively. The Chairman is responsible for setting the agenda for each Board meeting in consultation with the CEO, taking into account where appropriate, matters proposed by the Directors, and ensuring that the Directors receive complete, adequate and timely information. The Chairman is also responsible for encouraging constructive debate between the Board and Management
on strategy, business operations and other plans, as well as ensuring that they work together with integrity and competency. The Board, under the leadership of the Chairman, also ensures effective communication with Unitholders and promotes a high standard of corporate governance. The Chairman also ensures that Board meetings are held regularly and on an ad-hoc basis where required.
The CEO, Mr Yoshihiko Machida, is an Executive Director with full executive responsibilities over the business directions and operational decisions of AGT. As CEO, he leads the other members of Management in meeting the stated strategic and operational objectives of AGT and is responsible for planning the future strategic
development and day-to-day operations of the Trustee-Manager and AGT, as well as analysing the performance of the golf courses held by AGT and developing the internal and external growth strategies. He also ensures the quality and timeliness of the flow of information between Management and the Board.
Given that the roles of the Chairman and CEO are separate and the Chairman is independent, no lead Independent Director is required to be appointed.
There should be a formal and transparent process for the appointment and re-appointment of
directors to the Board.
Due to the nature and scale of its existing operations, the Trustee-Manager does not consider it necessary
for the Board to establish a separate nominating committee. The Trustee-Manager, and not AGT, appoints
all the Directors.
The Board performs the functions that a nominating committee would otherwise have performed. It
administers nomination to the Board, reviews the structure, size, competence, experience and composition
of the Board. In addition, the Board reviews the independence of the Directors. The Board also retains
responsibility for identifying, reviewing and appointing suitable new candidates to join the Board as
Directors. In reviewing and recommending the appointment of new Directors, the Board takes into
consideration the current Board mix and size, the suitability of the proposed candidate based on key
attributes such as commitment, competency and integrity as well as the candidate's ability to carry out
his/her duties as a Director. The search for candidates to be appointed as new Board members will be
conducted through a broad network of recommendations and contacts.
All candidates will be carefully evaluated by the Board to ensure that recommendations are well supported
The Board also identifies candidates to fill vacancies on the Board as and when the need arises. Renewals
or replacement of Board members do not necessarily reflect their contributions to date, but may be
driven by the need to re-position and align the Board with the needs of the Trustee-Manager, AGT and
A formal letter of appointment explaining their duties and obligations as Director is provided to every new
Director upon appointment. The formal letter of appointment sets out the time commitment required of the
Director and the Director's roles and responsibilities, including disclosure requirements and best practices relating
to dealings in securities under applicable laws and regulations.
All the Directors shall be up for re-nomination and re-election at every annual general meeting of the Trustee-Manager.
There should be a formal annual assessment of the effectiveness of the Board as a whole and
its board committees and the contribution by each director to the effectiveness of the Board.
The Board had put in place a formal process to annually assess the performance and effectiveness of the Board
as a whole and its Board Committees. The Board members are provided with a set of questions, setting out
the salient recommendations from the Code, which is designed to seek their views or feedback on the various
aspects of the Board as well as the Board Committees. The Company Secretary compiles Directors' responses
to the questionnaires into a consolidated report. The Board members will then gather to discuss their views
on the various aspects of the Board and improvements made to areas where the Board views to be necessary
to enhance the overall effectiveness of the Board and/or Board Committees. The performance criteria for the
evaluation covers amongst other criteria, the Board's composition and size, Board processes, the Board's access
to information, corporate strategy, internal controls, risk management and standard of conduct and performance
of the Board's principal functions and fiduciary duties, guidance to and communication with Management. The
evaluation for the financial year ended 31 March 2018 confirmed that the Board and its Board Committees
were generally functioning effectively during the year.
While the 2012 CG Code recommends that the Directors be assessed individually, the Board felt that it is more
appropriate and effective to assess the Board as a whole, bearing in mind that each Board member contributes
in different ways to the success of the Trustee-Manager.
In determining whether each Director is able to devote sufficient time to discharge his or her duties, the
Board will take cognizance of the requirements under the Code, but its assessment will not be restricted
only to the number of board representations of each Director and their respective principal commitments
per se. The contributions by each Director to and during Board and Board Committee meetings, as well as
their attendance at such meetings, are also taken into account. Although some of the Directors have other
principal commitments, the Board is of the view that the individual Directors have devoted sufficient time and attention towards the discharge of their responsibilities as Directors and towards the affair of AGT and Trustee-Manager
for the year ended 31 March 2018. The Board will continue to review from time to time the board
representations and other principal commitments of each Director to ensure that the Directors continue to
meet the demands of the Trustee-Manager and AGT, and are able to discharge their duties and responsibilities
adequately. For the financial year under review, the Board is satisfied that all Directors have been able to
and have adequately carried out their duties as Directors notwithstanding their other listed company board
representations and other principal commitments.
ACCESS TO INFORMATION
In order to fulfil their responsibilities, directors should be provided with complete, adequate
and timely information prior to board meetings and on an on-going basis so as to enable them
to make informed decisions to discharge their duties and responsibilities.
Management endeavours to provide the Board with complete, adequate and timely information prior to
Board meetings and as and when the need arises, in order to allow the Board to make informed decisions
to discharge its duties and responsibilities.
Board meetings for each quarter are scheduled in advance to facilitate Directors' individual administrative
arrangements in respect of ongoing commitments. Whenever warranted, ad-hoc Board meetings are
held. As a general rule, agenda for the meetings are circulated seven days in advance of each meeting.
As a best practice, Management also tries to circulate other Board papers prior to the meeting, including
background or explanatory information regarding the agenda items, so as to enable the Directors to make
informed decisions. Such information includes minutes of the previous meetings as well as financial and
operational matters requiring the Board's attention or approval.
Management provides complete, adequate and timely information to the Board on the affairs and issues of
AGT that require the Board's decision as well as ongoing reports relating to the financial and operational
performance of AGT.
Timely communication with Board members is effected through electronic means which include electronic mail,
teleconferencing and video conferencing. Informal meetings are also held for Management to brief Directors
on developments and policy changes or adoption in the early stages before formal Board approval is sought.
Management keeps Board members abreast of key developments affecting AGT as well as material
transactions so that the Board is kept fully aware of the affairs of AGT.
All Directors have separate and independent access to Management, the Company Secretary, as well as the
internal and external auditors at all times. The Company Secretary (and/or his authorised designates) attends
Board meetings and ensures that established procedures and all relevant statutes and regulations that are
applicable to the Trustee-Manager and AGT are complied with. The appointment and removal of the Company
Secretary is subject to the Board's approval.
The Trustee-Manager has in place procedures to enable Directors, whether as a group or individually,
to obtain independent professional advice, as and when necessary, in furtherance of their duties. The
appointment of such independent professional advisers is subject to approval by the Board. Any expenses
and costs associated thereto will be borne by the Trustee-Manager.
The Audit and Risk Committee also meets the internal and external auditors separately at least once a year
without the presence of Management.
PROCEDURES FOR DEVELOPING REMUNERATION POLICIES
There should be a formal and transparent procedure for developing policy on executive
remuneration and for fixing the remuneration packages of individual directors. No director
should be involved in deciding his own remuneration.
LEVEL AND MIX OF REMUNERATION
The level and structure of remuneration should be aligned with the long-term interest and
risk policies of the company, and should be appropriate to attract, retain and motivate (a) the
directors to provide good stewardship of the company, and (b) key management personnel
to successfully manage the company. However, companies should avoid paying more than is
necessary for this purpose.
DISCLOSURE ON REMUNERATION
Every company should provide clear disclosure of its remuneration policies, level and mix of
remuneration, and the procedure for setting remuneration, in the company's annual report.
It should provide disclosure in relation to its remuneration policies to enable investors to
understand the link between remuneration paid to Directors and key management personnel,
The Remuneration Committee ("RC") ensures that the remuneration policy for the key management personnel
of the Trustee-Manager is competitive and attractive enough to attract, motivate and retain good quality
employees. The RC assists the Board in the discussion and recommendation for matters relating to executive
remuneration and similar issues.
The RC comprises the three Independent Directors as members with Mr Hitoshi Kumagai as Chairman of the
Committee. The members of the RC are Messrs Khoo Kee Cheok and Chong Teck Sin. The RC met subsequent
to the financial year-end.
The RC is guided by a set of written rules known as the RC terms of reference that has been approved by the
Board. The RC will review and make recommendations on the remuneration packages of the Executive Directors
and key management personnel of the Trustee-Manager.
All Directors' fees and remuneration of the employees, including the executive officers of the Trustee-Manager ("Executive Officers") are paid by the Trustee-Manager out of the management fees paid by AGT to the Trustee-Manager.
Independent Directors receive fixed Directors' fees payable quarterly in arrears for their Board and Board Committee membership. The Directors' fees are appropriate to their level of contribution, taking into account their responsibilities and time spent such that the independence of the Independent Directors is not
compromised by their compensation. The Directors' fees are subject to approval by the shareholders of the Trustee-Manager.
The remuneration policy adopted by the Trustee-Manager has regard to the objective of attracting, rewarding
and retaining performing staff. Staff remuneration comprises a fixed component in the form of basic salary and
a variable component in the form of bonuses. Variable bonus is pegged to the performance of the individual and
the performance of AGT. This clearly aligns staff remuneration with the long-term interests of the Unitholders.
There are currently no option schemes or other long-term incentive schemes in place in relation to AGT and
there are also no existing or proposed service agreements entered into by the Directors or Executive Officers
with the Trustee-Manager that provide for benefits upon termination or retirement, or post-employment. No
compensation is payable to any Director or Executive Officer in the form of option in units or pursuant to any
bonus or profit-sharing plan or any other profit-linked agreement or arrangement under the service contracts.
The fees and remuneration paid to the Directors and key management personnel of the Trustee-Manager for
the financial year ended 31 March 2018 are set out below:
The Trustee-Manager believes that it may not be in the interest of the Company to disclose the remuneration
of the Directors and Key Management personnel as recommended by the Code for the following reasons:
- The remuneration of the Executive Directors (including the CEO) and Key Management personnel are not paid out of the Trust but instead remunerated directly by the Trustee-Manager;
- Remuneration matters of the Executive Directors (including the CEO) and Key Management personnel are confidential and sensitive matters;
- The negative impact which such disclosure may have on the Trustee-Manager in retaining talent on a long-term basis taking into consideration the confidential nature of remuneration matters and the importance of ensuring the stability and continuity of the business operations with an experienced management team in place.
The total remuneration paid to the Key Management personnel (who are not Directors or the CEO) for the financial year ended 31 March 2018 was approximately S$550,000.
There are no employees of the Trustee-Manager, AGT and its subsidiary who are immediate family members of the Directors or the CEO during the financial year ended 31 March 2018.
ACCOUNTABILITY AND AUDIT ACCOUNTABILITY
The Board should present a balanced and understandable assessment of the company's
performance, position and prospects.
The Trustee-Manager provides Unitholders with quarterly and annual financial statements within the
timeframe set out in the Listing Manual. In doing so, the Board also aims to provide Unitholders with a
balanced, clear and understandable assessment of AGT's performance, position and prospects. In order
to achieve this, Management provides the Board with management accounts on a quarterly basis and
such explanation and information as any Director may require, to enable the Directors to keep abreast,
and make a balanced and informed assessment of AGT's performance, position and prospects.
Price-sensitive information and reports are further disseminated to Unitholders through announcements
via SGXNET and press releases. This Annual Report to Unitholders is sent to all Unitholders and made
available on SGXNET and AGT's corporate website.
RISK MANAGEMENT AND INTERNAL CONTROLS
The Board is responsible for the governance of risk. The Board should ensure that Management
maintains a sound system of risk management and internal controls to safeguard Unitholders'
interests and the company's assets, and should determine the nature and extent of the significant
risks which the Board is willing to take in achieving its strategic objectives.
The Board has overall responsibility for the governance of risk and exercises oversight of the risk management
strategy and framework. The Audit and Risk Committee ("ARC") provides guidance and advice on the financial
reporting risk and the adequacy and effectiveness of the Trustee-Manager's internal controls.
The Trustee-Manager adopts a set of Risk Management Rules which sets out the basic rules and guidelines
for managing risks in an integrated, systematic and consistent manner so as to achieve the business
objectives of AGT as part of its risk management strategy and framework.
As part of its overall risk management, Management, amongst other things, undertakes and performs risk and
control assessment using a risk control matrix which also serves as a risk register which identifies the material
risks it faces and the corresponding internal controls in place to manage or mitigate those risks. For the financial
year ended 31 March 2018, the Trustee-Manager has reviewed AGT's financial, operational, compliance and
information technology risks. These risks are prioritised based on their relative importance or implications for
AGT should such risks materialise. The material risks are analysed and discussed by the ARC and reported to
the Board whereas other risks are managed at the Management level and reported to the Board only on an
exceptional basis. The risk assessment is conducted quarterly. The risk register is presented to the ARC quarterly
Internal auditors conduct audits that involve testing the effectiveness of the material internal control
systems by the Trustee-Manager and AGT and addressing financial, operational, compliance and
information technology risks, including testing, where practical, material internal controls in areas managed
by external service providers.
Any material non-compliance or lapses in internal controls together with corrective measures recommended by
internal auditors are reported to and reviewed by the ARC. The adequacy and effectiveness of the measures
taken by the Trustee-Manager in response to the recommendations made by the internal and external auditors
are also monitored and reviewed by the ARC.
The Trustee-Manager has also instituted/established the following:
- procedures to deal with conflicts of interest;
- internal control systems to ensure that all future interested person transactions will be undertaken
on normal commercial terms and will not be prejudicial to the interests of AGT and its Unitholders;
- investment guidelines to govern the investment and divestment decisions of AGT; and
- in relation to the use of derivatives to hedge interest rates risk, foreign exchange risks and other types
of risks, a system of pre-approvals from the ARC prior to the entry into any such transactions.
Opinion of the Board on Risk Management and Internal Controls
The Board has received assurance from the CEO and Chief Financial Officer that (1) the Group's financial records
have been properly maintained and the financial statements give a true and fair view of AGT's operations and
finance and (2) the risk management and internal control systems in place within the Group are adequate and
effective in addressing the material risks in the Group in its current business environment including material
financial, operational, compliance and information technology risks.
The Board, with the concurrence of the ARC, is of the opinion that Trustee-Manager's existing internal controls
are adequate and effective as at 31 March 2018 to address material financial, operational, compliance and
information technology risks of AGT, based on the risk management and internal controls framework established
and maintained by Trustee-Manager, work performed by both internal and external auditors as well as reviews
performed by Management and the ARC.
The Board believes that the existing risk management and internal controls framework provides reasonable, but
not absolute, assurance that AGT and the Trustee-Manager will not be adversely affected by any event that
could be reasonably foreseen as the Trustee-Manager works to achieve AGT's business objectives. All systems
on risk management and internal controls contain inherent limitations and no system can provide absolute
assurance against the occurrence of material errors, poor judgement in decision-making, human error losses,
fraud or other irregularities. The Board notes that the objective of an internal control system is to manage
rather than eliminate the risk of failure.
AUDIT & RISK COMMITTEE
The Board should establish an Audit Committee with written terms of reference which clearly
set out its authority and duties.
The ARC comprises three members, all of whom are Independent Directors and appropriately qualified
with the relevant business, accounting and financial management experience and skills to discharge their
responsibilities. None of the ARC members were previous partners or directors of AGT's external auditors,
PricewaterhouseCoopers LLP ("PwC"), within the last twelve months or hold any financial interest in the external
auditors. As at 31 March 2018, the members of the ARC are:
Mr Chong Teck Sin (Chairman)
Mr Khoo Kee Cheok
Mr Hitoshi Kumagai
The ARC functions independently of the Executive Officers and the other Directors who are not members of the
ARC. Management is required to provide their fullest co-operation in providing information and resources, and
in implementing or carrying out all requests made by the ARC. The ARC has direct access to the internal and
external auditors and full discretion to invite any Director or Executive Officer to attend its meetings. Similarly,
both the internal and external auditors are given unrestricted access to the ARC.
The ARC is regulated by a set of written rules known as the ARC Committee Terms of Reference that has been
endorsed by the Board. The principal responsibilities of the ARC include:
- to review with the internal and external auditors of AGT, the following:
- the internal and external audit plans of AGT;
- the auditors' evaluation of the system of internal accounting controls of the Trustee-Manager;
- the respective auditors' audit reports for AGT;
- the auditors' management letter and management's response; and
- ensure co-ordination where more than one audit firm is involved;
- to review:
- the assistance given by the Management to the auditors of AGT;
- the scope and results of the internal audit procedures of the Trustee-Manager of AGT;
- the policies and practices put in place by the Trustee-Manager for AGT as a registered business
trust to ensure compliance with the BTA and the Trust Deed;
- the procedures put in place by the Trustee-Manager for managing any conflict that may arise
between the interests of the Unitholders and the interests of the Trustee-Manager, including
Interested Person Transactions, the indemnification of expenses or liabilities incurred by the
Trustee-Manager and the setting of fees or charges payable out of the Trust Property;
- Interested Person Transactions for potential conflicts of interest; and
- risk management policies and guidelines and monitor compliance therewith;
- to review the statement of financial position, statement of profit or loss and cash flow statement of
AGT and the statement of financial position, statement of profit or loss and cash flow statement of
the Trustee-Manager submitted to it by the Trustee-Manager, and thereafter to submit them to the
- to review the allocation of profits and losses of the tokumei kumiai ("TK") business; namely, the
management and operation of the golf course business, pursuant to the TK agreement governing
the TK relationship between the investor and the business operator;
- to review significant reporting issues and judgements to ensure the integrity of the financial
statements and any formal announcements relating to financial performance;
- to discuss problems and concerns, if any, arising from the quarterly/interim and final audits, in
consultation with the external auditors and the internal auditors where necessary;
- to report to the Board:
- any inadequacies, deficiencies or matters of concern of which the ARC becomes aware or that it
suspects arising from its review of the items referred to in sub-paragraphs (a), (b) and (c) above;
- any breach of the BTA or any breach of the provisions of the Trust Deed, of which the ARC
becomes aware or that it suspects;
- to report to the Monetary Authority of Singapore ("MAS") if the ARC is of the view that the Board
has not taken, or does not propose to take, appropriate action to deal with a matter reported under
sub-paragraph (g) above;
- to nominate a person or persons as auditor of AGT, notwithstanding anything contained in the Trust
- to review and approve all hedging policies and instruments to be implemented by AGT and the Golf
Course Holding Company, if any;
- to oversee the announcements made by the Trustee-Manager on a quarterly basis in relation to
updates to the land and building issues in relation to the assets of AGT;
- to monitor the implementation of outstanding internal control recommendations highlighted by the
auditors in the course of their audit of the financial statements of AGT, the Trustee-Manager and
their respective subsidiaries (if any) taken as a whole;
- to meet with external and internal auditors, without the presence of the Executive Officers, at least
once annually to discuss any problems and concerns they may have;
- to review and advise the Board in formulating its risks policies to effectively identify and manage AGT
and the Trustee-Manager's current (and future) risks in the areas of financial, operational, compliance
and information technology;
- to review the design and implementation of the overall risk management systems and internal control
systems (including financial, operational, compliance and information technology controls);
- to review the adequacy and effectiveness of AGT and the Trustee-Manager's risk management and
internal control systems (including financial, operational, compliance and information technology
controls) and to report to the Board annually;
- to review the scope and results of the internal audit procedures including the effectiveness of the
internal audit function and ensure that the internal audit function is adequately resourced and has
appropriate standing within AGT;
- to review and discuss with the external auditors, any suspected fraud or irregularity, or suspected
infringement of any law, rules or regulations, which has or is likely to have a material impact on
AGT's operating results or financial position, and Management's response;
- to investigate any matter within its terms of reference, with full access to and co-operation by
Management and full discretion to invite any Director or Executive Officer to attend its meetings,
and reasonable resources to enable it to discharge its functions properly;
- to review arrangements by which staff of the Trustee-Manager and AGT and any other persons may,
in confidence, raise concerns about possible improprieties in matters of financial reporting or other
matters and ensure that arrangements are in place for such concerns to be raised and independently
investigated and for appropriate follow up actions to be taken;
- to report to the Board its findings from time to time on matters arising and requiring the attention of
- to approve the hiring, removal, evaluation and compensation of the head of the internal audit
function, or the accounting firm/auditing firm or corporation to which the internal audit function
is outsourced. To ensure that the internal audit function is staffed with persons with the relevant
qualification and experience and that they carry out their functions according to the standards
set by nationally or internationally recognised professional bodies, including the Standards for the
Professional Practice of Internal Auditing set by the Institute of Internal Auditors;
- to review annually the scope and results of the external audit, and the independence and objectivity
of the external auditors, and to recommend to the Board the appointment, re-appointment and
removal of the external auditors, and approve the remuneration and terms of engagement of the
- to review the audit representation letters before consideration by the Board, giving particular
consideration to matters that are related to non-standard issues;
- to undertake such other reviews and projects as may be requested by the Board; and
- to undertake such other functions and duties as may be required by statute or the Listing Manual,
and by such amendments made thereto from time to time.
The ARC is briefed and updated by external auditors on relevant changes to accounting standards and issues
that have direct impact on financial statements during each of the meetings. During the financial year under
review, the ARC also held meetings with the external auditors and internal auditors without the presence of
In performing its function for the financial year ended 31 March 2018, the ARC:
- held five meetings in the period under review;
- met with the external and internal auditors without the presence of Management, to review any
matters that might be raised privately;
- reviewed the audit plans of external and internal auditors of AGT and their reports arising from the
- reviewed the volume and nature of non-audit services provided by the external auditors and received
the requisite information from external auditors supporting the latter's independence. Based on the
information, the ARC is satisfied that the nature and the extent of such services would not affect the
independence and objectivity of the external auditors. The external auditors have also confirmed their
independence in this respect;
- reviewed the nature of interested person transactions; and
- reviewed and pre-approved the derivatives transactions to ensure that the instruments, processes
and practices are in accordance with the policy approved by the Board.
The total audit fees paid to the external auditors, PwC, are disclosed in the table below:
AGT has complied with the requirement of Rules 712 and 715 of the Listing Manual in relation to the
appointment of its external auditors.
The Trustee-Manager has put in place a whistle-blowing policy and has implemented relevant procedures, as
approved by the ARC and adopted by the Board to provide an avenue through which employees and external
parties alike may raise, in good faith and in confidence, any concerns about possible improprieties in matters of
financial reporting or other matters to the ARC and that there will be independent investigation and appropriate
follow-up actions taken.
Concerns about possible improprieties may be raised either in person or in writing by emailing their
concerns to firstname.lastname@example.org. Complaints may also be sent to the Trustee-Manager's registered address at 80 Robinson
Road, #22-03A, Singapore 068898 and addressed to the Audit and Risk Committee c/o Accordia Golf Trust Management Pte. Ltd.
The company should establish an effective internal audit function that is adequately resourced
and independent of the activities it audits.
The internal audit function is outsourced to BDO LLP. BDO LLP adopts the Standards for the Professional
Practice of Internal Auditing set by the Institute of Internal Auditors.
The internal auditors report directly to the Chairman of the ARC and administratively to the CEO. The internal
auditors plan the internal audit schedules in consultation with, but independent of the Management. The audit
plan is submitted to the ARC for approval prior to the commencement of the internal audit work. The ARC
reviews the internal audit report and monitors the implementation of the improvements required on internal
control weaknesses identified.
The ARC is of the view that the internal auditors have adequate resources to perform its functions and have,
to the best of its ability, maintained its independence from the activities that it audits. The ARC also reviews
the results of internal audits and Management's actions in resolving any audit issues reported.
Companies should treat all Unitholders fairly and equitably, and should recognise, protect and
facilitate the exercise of Unitholders' rights, and continually review and update such governance
COMMUNICATION WITH UNITHOLDERS
Companies should actively engage their Unitholders and put in place an investor relations policy
to promote regular, effective and fair communication with Unitholders.
The Trustee-Manager is committed to treating all Unitholders fairly and equitably and keeping all
Unitholders and other stakeholders and analysts informed of the performance and changes in AGT or its
business which would be likely to materially affect the price or value of Units, on a timely and consistent
basis, so as to assist Unitholders and investors in their investment decisions.
The Trustee-Manager provides accurate and timely disclosure of material information relating to AGT by way
of public releases or announcements via SGXNET and subsequently on its corporate website www.agtrust.
com.sg. The corporate website also includes contact details for investor enquiries and feedback. Enquiries and
feedback are answered within three business days. Where immediate disclosure is not practicable, the relevant
announcement is made as soon as possible to ensure that all stakeholders and the general public have equal
access to the information.
All Unitholders are entitled to attend general meetings and are accorded the opportunity to participate
effectively and vote at general meetings. Unitholders are informed in advance of the meeting rules, voting
procedures, matters requiring Unitholders' approval and other information necessary for Unitholders to exercise
their rights to attend, speak and vote at general meetings.
The Trustee-Manager had a dedicated Investor Relations Manager to facilitate all communications.
Together with the Management, the Investor Relations Manager communicates with Unitholders, its stakeholders
as well as analysts and brokers on a regular basis through investment conferences, non-deal roadshows,
one-on-one meetings and group meetings to update AGT's strategy, performance and answer to any queries.
In addition, yearly site visits are conducted for analysts to have a deeper understanding of its business.
CONDUCT OF UNITHOLDER MEETINGS
Companies should encourage greater Unitholder participation at general meetings of Unitholders,
and allow Unitholders the opportunity to communicate their views on various matters affecting
The Trustee-Manager supports the principle of encouraging Unitholders' participation and voting at general
meetings. General meetings will be convened at least once a year in accordance with applicable laws and
regulations and all Unitholders will receive a copy of AGT's annual report with the notice of the annual general
meeting ("AGM") prior to the AGM in compliance with the requisite notice period. For an extraordinary
general meeting ("EGM") to be held, Unitholders will receive a copy of a circular with the notice of EGM which
contains details of the matters to be proposed for Unitholders' consideration and approval. Notices for the
general meetings setting out all items of business to be transacted at the general meetings will also be issued
via SGXNET and advertised in a major newspaper in Singapore.
At general meetings, Unitholders are encouraged to communicate their views on and discuss with the Board
and the Trustee-Manager matters which they are concerned about regarding AGT. Representatives of the
Trustee-Manager, Directors (including the Chairman of the Board and the Chairman of the ARC), the Trustee-Manager's
senior management and the external auditors of AGT, would usually be present at general meetings.
To safeguard Unitholders' interests and rights, a separate resolution is proposed for each substantially separate
issue at general meetings. At Unitholders' meeting, each resolution will be voted on by way of electronic poll
voting for Unitholders/proxies present at the Unitholders' meetings. The detailed results showing the number
of votes cast for and against each resolution and the respective percentages after each resolution has been
put to vote are displayed real-time at the Unitholders' meeting. The outcome of each Unitholders' meeting will
also be announced in a timely manner through SGXNET after the Unitholders' meeting.
Minutes of general meetings are prepared and are available to Unitholders for their inspection upon request.
Unitholders will also have the opportunity to communicate their views and discuss with the Board and
Management on matters affecting AGT after the general meetings.
STATEMENT OF POLICIES AND PROCEDURES
The Trustee-Manager has the dual responsibility of safeguarding the interests of Unitholders and managing
the business conducted by AGT. The Trustee-Manager has general powers of management over the business
and assets of AGT and its main responsibility is to manage AGT's assets and liabilities for the benefit of the
Unitholders as a whole. The Trustee-Manager is not involved in any other business other than managing AGT.
The Trustee-Manager will set the strategic direction of AGT and decide on the acquisition, divestment or
enhancement of assets of AGT in accordance with its stated investment strategy. Additionally, the Trustee-Manager
will undertake active management of AGT's assets (being the TK Interests) to enhance the performance
of the portfolio. It will also undertake capital and risk management strategies in order to maintain a strong
balance sheet for AGT.
The Trustee-Manager is also obliged to exercise the degree of care and diligence required of a trustee-manager
of a registered business trust to comply with the applicable provisions of all relevant legislation, as well as
the Listing Manual, and is responsible for ensuring compliance with the Trust Deed and all relevant contracts
entered into by the Trustee-Manager on behalf of AGT.
Furthermore, the Trustee-Manager will prepare business plans on a regular basis, which may contain proposals
and forecasts on net income, capital expenditure, sales and valuations, explanations of major variances to
previous forecasts, written commentaries on key issues and any relevant assumptions. The purpose of these
plans is to explain the performance of AGT's investments.
The Trustee-Manager, in exercising its powers and carrying out its duties as Trustee-Manager, is required
- treat Unitholders who hold Units in the same class fairly and equally;
- ensure that all payments out of the Trust Property are made in accordance with the BTA and the
- report to the Authority any contravention of the BTA or the Securities and Futures (Offers of Investments)
(Business Trusts) (No. 2) Regulations 2005 ("SF BT Regulations") by any other person that:
- relates to AGT; and
- has had, has or is likely to have, a material adverse effect on the interests of all Unitholders, or
any class of Unitholders, as a whole, as soon as practicable after the Trustee-Manager becomes
aware of the contravention;
- ensure that the Trust Property is properly accounted for; and
- ensure that the Trust Property is kept distinct from the property held in its own capacity.
The Board meets regularly to review AGT's business activities and strategies pursuant to its then prevailing
investment mandate. Such regular review is aimed at ensuring adherence to the Trust Deed and compliance
with any applicable legislation, regulations and guidelines such that all projects are within the permitted
business scope under the Trust Deed. Prior to the conduct of any significant business transaction, the Board,
the ARC and/or Management will have careful regard to the provisions of the Trust Deed and when in doubt,
seek advice from professional advisers.
The Trustee-Manager also has the following statutory duties under the BTA:
- at all times act honestly and exercise reasonable diligence in the discharge of its duties as AGT's
trustee-manager in accordance with the BTA and the Trust Deed;
- act in the best interests of all Unitholders as a whole and give priority to the interests of all
Unitholders as a whole over its own interests in the event of a conflict between the interests of all
the Unitholders as a whole and its own interests;
- not make improper use of any information acquired by virtue of its position as Trustee-Manager to
gain, directly or indirectly, an advantage for itself or for any other person to the detriment of the
- hold the Trust Property on trust for all Unitholders as a whole in accordance with the terms of the
Dealing in Units
The Trustee-Manager has adopted an internal compliance code of conduct to provide guidance to all
officers of the Trustee-Manager with regard to dealings in securities of AGT (the "Code of Conduct")
in compliance with Rule 1207(19) of the Listing Manual.
In general, the Code of Conduct encourages Directors and employees of the Trustee-Manager to hold
Units over the long term and not to deal in such Units on short term considerations. The Code of Conduct
also prohibits the Trustee-Manager, its Directors and employees from dealing in such Units:
- during the period commencing (i) two weeks before the public announcement of AGT's quarterly
results; (ii) one month before the public announcement of AGT's annual results and (where applicable)
any property valuations, and ending on the date of the announcement of the relevant results or, as
the case may be, property valuations; and
- at any time while in possession of price sensitive information.
The Directors and employees of the Trustee-Manager are expected to observe insider-trading laws at all
Each Director and the CEO are required to give notice in writing to the Trustee-Manager of, among others,
particulars of his interest in Units or of changes in the number of Units which he has an interest, within two
business days in Singapore after the date on which the Director or CEO became a director or CEO of the Trustee-Manager
or the date on which he acquires an interest in the Units or he becomes aware of the occurrence of
the event giving rise to changes in the number of Units which he has an interest.
The Trustee-Manager is required to announce to the SGX-ST the particulars of its holdings in the Units and any
changes thereto as soon as practicable and in any case no later than the end of the business day following the
day on which it acquires or, as the case may be, disposes of any Units.
There are no material contracts entered into by AGT or any of its subsidiary that involve the interests of the
CEO, any Director, any controlling Unitholder or any controlling shareholder of the Trustee-Manager, either
still subsisting or entered into during FY17/18, other than, where applicable:
- as disclosed on page 332 to 353 of the Prospectus; and
- interested person transactions as listed in the Interested Person Transactions section of this Annual
Conflicts of Interests
The Trustee-Manager has instituted the following procedures to deal with conflict of interest issues:
- All resolutions in writing of the Directors in relation to matters concerning AGT must be
approved by a majority of the Directors, including at least one Independent Director.
- In respect of matters in which the Sponsor and/or its subsidiaries have an interest, direct or
indirect, any nominees appointed by the Sponsor and/or its subsidiaries to the Board to represent
its/their interests will abstain from voting. In such matters, the quorum must comprise a majority
of the Independent Directors and must exclude nominee Directors of the Sponsor and/or its
- Where matters concerning AGT relate to transactions entered into or to be entered into by the Trustee-Manager
for and on behalf of AGT with an interested person, the Board is required to consider the
terms of such transactions to satisfy itself that such transactions are conducted on normal commercial
terms, are not prejudicial to the interests of AGT and its minority Unitholders, and in accordance with all
applicable requirements of the Listing Manual and the BTA relating to the transaction in question. If the
Trustee-Manager is to sign any contract with a related party of the Trustee-Manager or AGT, the Trustee-Manager
(including the ARC) will review the contract to ensure that it complies with the provisions of
the Listing Manual and the BTA relating to interested person transactions (as may be amended from
time to time) as well as such other guidelines as may from time to time be prescribed by the MAS and
the SGX-ST to apply to business trusts.
- It should be noted that the Trustee-Manager is prohibited from carrying on any business other
than the management and operation of AGT as its trustee-manager.
- In order to manage any potential competition and conflicts of interest that may arise between
the Sponsor and the Trustee-Manager and/or the Golf Course Holding Company in relation
to any assets that fall within the investment mandate of AGT or the holding of the Initial
Portfolio golf courses for the purpose of managing and operating the golf course business
(the "TK Business"), the Sponsor has granted (i) a right of first refusal to Golf Course Holding
Company, (ii) a right of first refusal to the Trustee-Manager, and a call option to each of the
Golf Course Holding Company and the Trustee-Manager, with effect from the Listing Date.
- For as long as Daiwa Securities Group Inc. and/or its associates is a controlling shareholder of the
Trustee-Manager and should Daiwa Securities Group Inc. and/or its associates hold in aggregate
15% or more of the total voting rights of the Sponsor, Daiwa Securities Group Inc. and/or its
associates shall abstain from voting on their Units in relation to transactions entered into between
AGT or its subsidiary and the Sponsor group in accordance with the Listing Manual.
Interested Person Transactions
The Trustee-Manager has established an internal controls system to ensure that all interested person
- will be undertaken on normal commercial terms; and
- will not be prejudicial to the interests of AGT and its minority Unitholders.
As a general rule, the Trustee-Manager must demonstrate to its ARC that such transactions satisfy the foregoing
criteria. This may entail obtaining (where practicable) a quotation from a party unrelated to the Trustee-Manager.
The Trustee-Manager maintains a register to record all interested person transactions which are entered
into by AGT and the bases, including any quotations from unrelated parties obtained to support such
bases, on which they are entered into.
The Trustee-Manager has also incorporated into its internal audit plan, a periodic review of all interested
person transactions entered into by AGT during the period under review. Further, the ARC will review at least
quarterly in each financial year the interested person transactions entered into during such quarterly period to
ascertain that the guidelines and procedures established to monitor interested person transactions have been
Where matters concerning AGT relate to transactions entered into or to be entered into by the Trustee-Manager for and on behalf of AGT with a related party of the Trustee-Manager (which would include relevant associates thereof) or AGT, the Trustee-Manager is required to consider the terms of such transactions to satisfy itself that such transactions are conducted:
- on normal commercial terms;
- are not prejudicial to the interests of AGT and its minority Unitholders; and
- in accordance with all applicable requirements of the Listing Manual and the BTA relating to the
transaction in question.
If the Trustee-Manager is to sign any contract with a related party of the Trustee-Manager or AGT, the Trustee-Manager
(including the ARC) will review the contract to ensure that it complies with the provisions of the
Listing Manual and the BTA relating to interested person transactions (as may be amended from time to time)
as well as such other guidelines as may from time to time be prescribed by the MAS and the SGX-ST to apply
to business trusts.
The aggregate of transactions entered into with interested persons/parties during the financial year ended
31 March 2018 and pursuant to Rule 907 of the Listing Manual are as follows:
FEES PAYABLE TO THE TRUSTEE-MANAGER
The fees payable to the Trustee-Manager in respect of its services to AGT are calculated based on the
The Trustee-Manager is entitled under the Trust Deed to receive the Trustee-Manager's fee calculated in
the formula below:
- a base fee being 0.11% per annum of the value of the total assets of AGT on a consolidated basis;
- a performance fee being 0.25% per annum of the Adjusted Net Operating Income of the investments
- an acquisition fee being 0.6% of the appraised value of any investments acquired directly or indirectly
(through a special purpose vehicle or otherwise) by AGT, as determined by an independent third
party appraiser appointed by the Trustee-Manager or, where the acquisition is made by a special
purpose vehicle, such special purpose vehicle; and
- a divestment fee being 0.15% of the last available appraised value obtained by the Trustee-Manager or
the relevant special purpose vehicle of any investments sold or divested directly or indirectly (through
a special purpose vehicle or otherwise) by AGT, as determined by such an appraiser appointed by the
Trustee-Manager or, where the divestment is by a special purpose vehicle, such special purpose vehicle.
The Trustee-Manager may, in accordance with the Trust Deed, direct that all or a portion of any fees
payable to the Trustee-Manager be paid directly to any third parties.
Corporate Social Responsibility
The Trustee-Manager is committed to ensuring that its commercial activities are conducted in a manner that best
serves our stakeholders' interests. The activities are conducted within the framework of applicable professional
standards, laws and regulations.
Steps have been taken to integrate and manage the issues of sustainability and social responsibility within the
operations of the Trustee-Manager in order to minimise the impact on the environment and to ensure that there
are high standards in place to safeguard the safety and welfare of all the employees. Open communication
between employees and Management is encouraged to foster collaboration and teamwork.
The Group focuses on the long-term sustainability of golf business and is aware of the environmental issues
which the industry is constantly facing. As such, it has adopted a proactive approach towards environmental,
social and governance responsibility and introduces initiatives that benefit its stakeholders, employees and local
community. Details of the Group's initiatives will be disclosed in its inaugural Sustainability Report expected to
be published online later during this fiscal year.
30 June 2018