Huafeng Chemical Co., Ltd.
2025 Internal Control Self-Evaluation Report
To the Shareholders of Huafeng Chemical Co., Ltd.:
In accordance with the "Basic Norms for Enterprise Internal Control" and its supporting guidelines, as well as other internal control regulatory requirements (hereinafter referred to as the "Enterprise Internal Control Normative System"), and combined with Huafeng Chemical Co., Ltd.'s (hereinafter referred to as the "Company") internal control system and evaluation methods, based on daily supervision and special supervision of internal controls, the Company's Board of Directors has conducted a self-evaluation of the effectiveness of its internal controls as of December 31, 2025 (the internal control evaluation report benchmark date).
I. Important Statement
In accordance with the Enterprise Internal Control Normative System, the establishment, improvement, and effective implementation of internal controls, the evaluation of their effectiveness, and the truthful disclosure of the internal control evaluation report are the responsibilities of the Company's Board of Directors. The Audit Committee supervises the Board of Directors in establishing and implementing internal controls. Management is responsible for organizing and leading the daily operations of the Company's internal controls.
The Company's Board of Directors, directors, and senior management guarantee that this report contains no false records, misleading statements, or significant omissions, and they shall bear individual and joint legal liability for the truthfulness, accuracy, and completeness of the report's content.
The objective of the Company's internal control is to reasonably ensure that business operations are legal and compliant, assets are secure, financial reports and related information are true and complete, operating efficiency and effectiveness are improved, and development strategies are achieved. Due to the inherent limitations of internal control, it can only provide reasonable assurance for achieving these objectives. Furthermore, changes in circumstances may render internal controls inappropriate, or reduce the degree of compliance with control policies and procedures, and there is a certain risk in inferring the future effectiveness of internal controls based on the results of the internal control evaluation.
II. Internal Control Evaluation Conclusion
Based on the determination of material weaknesses in financial reporting internal controls, as of the internal control evaluation report benchmark date, the Company has no material weaknesses in financial reporting internal controls. The Board of Directors believes that the Company has maintained effective financial reporting internal controls in all material aspects in accordance with the requirements of the Enterprise Internal Control Normative System and relevant regulations.
Based on the determination of material weaknesses in non-financial reporting internal controls, as of the internal control evaluation report benchmark date, the Company has found no material weaknesses in non-financial reporting internal controls.
There have been no factors occurring between the internal control evaluation report benchmark date and the date of issuance of the internal control evaluation report that affect the conclusion of the internal control effectiveness evaluation.
III. Internal Control Evaluation Work
(I) Scope of Internal Control Evaluation