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Governance

1. Purpose of internal audit

The company has set up internal audit to assist the board of directors and managers to check and review the effectiveness of the internal control system, measure the effectiveness and efficiency of operations, the reliability of financial reporting and compliance with relevant laws and regulations, and Provide timely improvement suggestions to ensure the continuous and effective implementation of the internal system and serve as the basis for review and revision of the internal control system.

2. Internal audit organization

The company's audit office is equipped with full-time auditors who directly subordinate to the board of directors. One person in charge of the company is set up to supervise the company's internal audit business, as the full-time head of internal audit. In addition to attending the board of directors to make routine business reports, report to the chairman and supervisors when necessary.

Organization Chart
Board of Directors
Audit Room

3. The operation of internal audit

(1) Audit Range

Internal audit work includes checking and evaluating the adequacy and effectiveness of the internal control system of various departments in the company and the performance of operating activities. Specifically, the range of the audit includes the following:

  • Review the reliability and integrity of financial and operational information.
  • Review existing systems to ensure compliance with policies, plans, procedures, contracts and laws.
  • Review the methods of safeguarding assets and, if necessary, verify the existence of such assets.
  • Assess whether the resources used are economical and effective.
  • Review the operation or project plan to determine whether the results are consistent with the established goals.

(2) Audit object

The audit objects include all the businesses of the company's units, and the personnel of the units under inspection should cooperate closely.

(3) Methods of audit

Auditors should go to the inspected unit for on-site audits, but they may also require the inspected unit to submit documents, account books, vouchers, etc. for the audit of written information.

(4) Internal audit procedures

  • Audit work includes audit planning, information inspection and evaluation, communication of results, and follow-up.
  • The annual audit plan should be based on risk assessment considerations, and audit procedures should be drawn up for individual audit cases, and a draft should be made.
  • At the end of the on-site inspection, fully communicate with the supervisor of the inspected unit regarding the audit results, obtain the inspected unit's improvement plan and its estimated completion date when necessary, the auditors shall follow up the improvement actions.

(5) Timing of internal audit

  • Routine internal audit
    In order to ensure the effective implementation of the company's internal control system, the audit office will follow the characteristics of the eight cycles before the end of each year, refer to the instructions from the competent authority, the focus of the audit that should be strengthened, and the frequency of company transactions and the complexity of operations , jointly formulate an annual audit plan, and determine the audit time for each audit project based on the operational characteristics of the audit project and seasonal factors.
  • Irregular internal audit
    In order to fully understand the current operating conditions of the audited unit, the audit office determines the audit items and submits them to the supervisor for review based on the importance, risk, frequency of transactions, and complexity of operations in each cycle. Its content takes the "internal control system" and "internal audit implementation rules" as the main design axis to determine the focus of the inspection.
  • Project internal audit
    In order to ensure the effective implementation of the company's internal control system, the company's senior executives or audit supervisors shall specify the audit subject and time, and the auditors shall conduct various audit operations in accordance with the determined timetable. Before conducting any audit work, it should be based on the "Internal Control System" and "Internal Audit Implementation Rules" as the design main axis, and establish an audit procedure to facilitate the audit.

(6) Results report

The board of directors and management of the company reviews the results of the self-inspection of each unit and the audit report of the audit unit every year, prepares an internal control system statement and submits it to the Financial Management Committee for reference, and publishes the statement on the website, annual report and public brochure as required.