1.

During 2017, Audit Committee also assisted in terms of facilitating communication between
Commissioners and Directors with External Audit. In addition, Audit Committee ensured in
its reports that all Company’s operational activities are well controlledunder the principles of
accountability and independence. The Company’s internal control system has been
adequately implemented in order to secure the Company’s interests. We consider that the
entire committees under the Board of Commissioners have conducted all duties and
responsibilities optimally.
2. Internal Audit Unit As an integral part of financial supervision, Internal Audit is inseparable
from the management functions. One of its main duties is to provide constructive feedback
to the Management in anticipation of and taking actions early as possible against any risks.
During 2017, Internal Audit Unit had audited all aspects related to AHI performance. The
audit reports were submitted periodically to the President Director, with copies to Audit
Committee.
3. Component Internal Control
a. control environment
No COSO Firms Ket
1 companies show commitment Maintaining and enhancing In this case the company
to integrity and ethics employees’ integrity as well as is able to minimize If a
creating a conducive working criminal or inappropriate
environment have been the action occurs in the
Company’s commitment through the Company environment,
implementation of the employees can report to
“Whistleblowing” program since the the Integrity Old Friend
middle of 2013. through free telephone,
The program becomes an effective SMS, fax, e-mail,
media for every employee who wants website, or written
to report various violations or letters, which have been
irregularities that occur within the intensively socialized.
Company. Such violations or (according to coso)
irregularities that should be reported
to the Management include
This Whistleblowing program is a
compliance of Public Company
Principles and Governance No. 7. 5(
on annual report, page 70)
2 The Board of Commissioners The same consideration goes to Audit management can walk
shows its independence to Committee as well as Nomination according to the rules
management and carries out and Remuneration Committee, who and have responsibility in
oversight of the development assist the Board of Commissioners in carrying out their duties.
and performance of internal conducting supervision and and this supervision to
controls assessment objectively towards the minimize fraud.
Company’s operational activities ( on (according to coso)
annual report, page 12)
3 Management with the Ace creates an organizational Clearer responsibility and
supervision of the board of structure to provide financial accountability until the
directors establishes the reporting responsibilities and responsibility holder is
structure, reporting lines, authority. until the Board of able to carry out his
authorities and Commissioners can exercise more duties with care
responsibilities in pursuing controlled supervision and control. ( (according to coso)
 objectives.
4 Organizations demonstrate a
commitment to attract,
develop, and maintain
competent individuals in line
with their goals.
5 Organizations convince
individuals to be responsible
for the duties and
responsibilities of their
internal control in pursuit of
goals.
b. Risk Assesment
No COSO
1 Organizations set goals with
sufficient clarity to enable
identification and risk
assessment related to
objectives.
2 Organizations identify risks to
achieving goals across entities
and risk analysts as a basis for
determining how risk must be
managed.
on annual report, page 24, Sructur
organized)
To that a commitment to attract, by recruiting employees
develop, and maintain competent with education in
individuals , the Company will accordance with the
continue to manage its human work offered, conducting
resources properly, from training, Compensation
recruitment, training, up to their and Benefits, creating a
development, based on I AM ELITE harmonious
values activities ( on annual report, environment between
page 72) the Company and
employees, Talent
management, and
Employee Performance
Management. until the
company has human
resources that support
internal control
(according to coso)
Each employee is encouraged to by demanding that
innovate or make improvement in employees always
the workplace, to be accountable in innovate and hold the
everything they do and to always responsibility of each
learn to improve mastery and company employee able
knowledge, enthusiasm and to monitor the
leadership, in order to achieve the performance of each
Company’s objectives, to employee
communicate and to work together (according to coso)
in a team and to have integrity
related to products, promises, and
money. ( on annual report, page 72)
Firms Ket
The Company has formulated a risk (according to coso)
management planning format, that companies can easily
identification, assessment, and carry out the process of
monitoring various risks so that identifying and assessing
relevant actions can be precisely and risks related to the
measurably determined. (on annual purpose of control
report, page 63)
During 2017, AHI conducted several (according to coso)
initiatives in risks management, such by identifying companies
as: can find out how these
• Identified and studied overall risks, risks can be managed
both at the head office and at the
stores
• Utilized information resulted from a
risk-based audit analysis carried out

3 Organizations consider the
potential for fraud in
assessing risk towards
achieving goals.
4 Organizations identify and
assess changes that can
significantly affect the
internal control system.
c. Control Activities
No COSO
1 Organizations choose and
develop control activities that
contribute to the risk
mitigation of achieving
targets at an acceptable
stage.
by Internal Audit Unit in an
integrated manner.
(on annual report, page 63-64)
The program becomes an effective (according to coso)
media for every employee who wants the potential for fraud to
to report various violations or occur is quickly
irregularities that occur within the discovered or can be
Company. Such violations or attracted by the
irregularities that should be reported existence of this program
to the Management(on annual
report, page 70)
the Group is still evaluating the (according to coso)
potential impact of the adoption of the company always
new standards (regulatory changes to updates the latest
PSAK), amendments to standards and regulations and analyzes
interpretations of these standards. the impact on the
(on annual report, page 62) company to reduce
disruption to internal
control
Firms Ket
In mitigating the above risks, the 1. During 2017, the
Company anticipates potential financial Company opened new
risks through the following strategies: 17 Ace outlets and 4
1. Open new stores with careful Toys Kingdom outlets.
planning and implementation; The expansion strategy
2. Develop strategies to improve store resulted in total 144 Ace
productivity and efficiency while outlets with total retail
keeping optimum number of space of more than
employees; 371,600 sqm and 30
Monitor inventory to ensure optimum Toys Kingdom outlets
quantity and product choice in each with total retail space of
category. (page 67) around 20.5 thousand
sqm.
2. Every employee in the
entire AHI stores is a
‘Sales Advisor’, instead
of ‘sales assistant’. In the
store, an advisor is not
simply ‘selling’, but also
must be able to provide
advice to customers
regarding their product
needs.
As a consequence of the
growing outlets in 2017,
the number of
employees also
increased to 13,266
persons at the end of
December 2017, or up
11.7% from 11,874
employees in 2016.
3. AHI management is
experienced in

2 Organizations choose and
develop general control
activities on technology to
support the achievement of
goals.
3 Organizations spread control
activities through policy
policies that determine what
is expected, and procedures
that put policy policy into
action.
monitoring consumer
spending patterns to
identify their needs. To
deal with inventory
management risks, AHI
has the ability to provide
optimal choices in each
category.
The achievement was the result of each department continued
to improve its respective
the Company’s initiative in improving performance, such as
the coordination of Merchandising– completing product lines
Operation–Marketing (MOM). (Merchandising), improving
(page 42) service quality through
training of product
knowledge and service
quality (Operation), as well
as creating more interesting
and more often marketing
programs, conducting digital
marketing, and utilizing
social media to get closer
with customers (Marketing).
The Board of Directors has a self- Director has policy to
assessment policy to assess its assess its performance,
performance, in accordance with in accordance with Public
Public Company Principles and Company Principles and
Governance No. 6.1. Elements of this Governance. Elements of
selfassessment policy are this selfassessment
achievements of operational and policy are achievements
financial goals. This is in line with of operational and
Public Company Principles and financial goals. It mean
Governance No.6.2. (page 54) that spread control
activities through policy
policies that determine
what is expected, and
procedures that put
policy policy into action
are director policy. And
what is company
expected are shown in
vision and mission
company.

d. Information And comunication

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1 The organization obtains or Transparency - Transparency We can know that all
produces and uses quality and principle has been applied in the information that AHI
relevant information to decisions making, disclosure of produces and uses
support the internal control relevant and material information for quality and relevant
function. the benefits of all stakeholders. information to support
(page 47) the internal control from
this implementation of
GCG principles in the
Company’s
2 The organization internally Internal control process in carrying The Audit Committee
communicates information, out business activities was already expresses views that
including goals and well and effectively implemented
responsibilities for internal (page 58)
control in order to support
the internal control function.
3 Organizations communicate Internal control process in carrying The Audit Committee
with internal parties out business activities was already expresses views that
regarding matters that affect well and effectively implemented
the function of internal (page 58)
control.
E. Monitoring Activities
No COSO Firms
1 Continuous monitoring, Audit Committee as well as
carried out through routine Nomination and Remuneration
management activities, Committee, who assist the Board of
supervision, benchmarking, Commissioners in conducting
reconciliation, and other supervision and assessment
actions related to the objectively towards the Company’s
implementation of tasks operational activities.
(page 11)
2 Separate evaluation is Internal Audit Department is
conducted through self- responsible to ensure good
assessment, review, and coordination among control functions
testing the effectiveness of in the Company, so that these
the Internal Control System functions can run effectively.
(page 60)
Internal control process
in carrying out business
activities) was already
well and effectively
implemented, so we can
coclude that The
organization internally
communicates
information, including
goals and responsibilities
for internal control in
order to support the
internal control function.
Internal control process
in carrying out business
activities) was already
well and effectively
implemented. so we can
coclude that no matters
that affect the function
of internal control.
Ket
Audit Committee
ensured in its reports
that all Company’s
operational activities are
well controlledunder the
principles of
accountability and
independence. The
Company’s internal
control system has been
adequately implemented
in order to secure the
Company’s interests.
In 2017, Internal Audit
has delivered its function
accordingly and the risk
management function
has effectively developed
its organization
capabilities, including
conducting trials
utilization of technology,
 organization, and data
analytics to gain more
effectiveness and
efficiency for Loss
Prevention function in
store, warehouse, and
head office.
Development of
capabilities and roll-out
strategy will be carried in
2018.
3 Follow-up of audit results in 2017 the Audit Committee held 4 1. Reviewed and discussed
the Company’s
recommendations and other (four) meetings consolidated financial
reviews must be immediately (page 57) statements quarterly with
completed and carried out in the Management;
accordance with the 2. Reviewed and
discussed significant
mechanism for resolving the Internal Audit findings
audit results and other in 2017, monitored the
reviews determined. implementation of audit
recommendations, and
internal audit work plan
in 2018;
3. Reviewed and
monitored the
development plans
realization of the Risk
Management unit in
2017; as well as
discussed the 2018
work plan; and
4. Reviewed and
discussed audit
implementation and
significant audit findings
with External Auditor,
as well as monitored
the implementation of
audit
recommendations.