Chapter 1 General Principles
Article 1
To standardize the selection (including reappointment and transfer) of accounting firms by Hubei Ping An Electric Technology Co., Ltd. (hereinafter referred to as "the Company"), effectively safeguard shareholder interests, and improve the quality of financial information, this system is formulated in accordance with the "Company Law of the People's Republic of China," "Securities Law of the People's Republic of China," "Management Measures for the Selection of Accounting Firms by State-owned Enterprises and Listed Companies," and other relevant laws, regulations, normative documents, as well as the provisions of the "Articles of Association of Hubei Ping An Electric Technology Co., Ltd." (hereinafter referred to as "the Articles of Association").
Article 2
The accounting firms selected by the Company to perform financial statement audit services (hereinafter referred to as "accounting firms") must follow the procedures outlined in this system when issuing audit opinions and audit reports on financial accounting reports. For other statutory audit services beyond financial accounting reports, the selection may refer to this system based on the significance of the matter.
Article 3
The selection of accounting firms by the Company must be reviewed by the Board of Directors' Audit Committee (hereinafter referred to as "the Audit Committee") and submitted for deliberation by the Board of Directors and the Shareholders' Meeting. The Company shall not engage accounting firms to conduct audit services before the deliberation by the Board of Directors and the Shareholders' Meeting.
Chapter 2 Requirements for Accounting Firm Quality
Article 4
The accounting firms selected by the Company must possess qualifications related to securities and futures business, have a good record of professional quality, and meet the following conditions:
- Have independent legal status and possess the qualifications required by the national industry authorities and the China Securities Regulatory Commission (hereinafter referred to as "CSRC") to engage in securities and futures-related business;
- Have a fixed workplace, sound organizational structure, and complete internal management and control systems;
- Be familiar with relevant national laws, regulations, rules, and policies regarding financial accounting;
- Have registered accountants capable of completing audit tasks and ensuring audit quality;
- Strictly implement relevant laws, regulations, rules, and policies regarding financial audits, and have a good social reputation and record of professional quality; for reappointed accounting firms, the newly appointed firm must not have received administrative penalties related to securities and futures business in the last three years;
- Other conditions stipulated by the CSRC.