Yunnan Eche New Materials (Group) Co., Ltd. Articles of Association for the Board of Directors' Audit Committee
Chapter 1 General Provisions
Article 1 To strengthen the functions of the Board of Directors of Yunnan Eche New Materials (Group) Co., Ltd. (hereinafter referred to as the "Company"), improve the efficiency of the Board of Directors, improve the audit evaluation and supervision mechanism of the Board of Directors, and ensure the effective supervision of the Company by the Board of Directors and improve the corporate governance structure, in accordance with the "Company Law of the People's Republic of China," the "Corporate Governance Guidelines for Listed Companies," the "Articles of Association of Yunnan Eche New Materials (Group) Co., Ltd." (hereinafter referred to as the "Articles of Association") and other relevant regulations, the Company has established the Board of Directors' Audit Committee and formulated these Articles.
Article 2 The Audit Committee is a specialized working body established by the Board of Directors in accordance with the Articles of Association. It is a committee composed of directors, primarily responsible for communication and evaluation of internal and external audits, review of financial information and its disclosure, supervision and inspection of major decision-making matters, and is accountable to the Board of Directors.
Chapter 2 Composition of Personnel
Article 3 The Audit Committee shall be composed of three directors, at least two of whom shall be independent directors (one of whom shall be a professional accountant). Members of the Audit Committee shall be directors who do not hold senior management positions in the Company.
Article 4 Members of the Audit Committee shall be nominated by the Chairman or the Nomination Committee of the Board of Directors and elected by the Board of Directors. The election of members shall be passed by more than half of all directors.
Article 5 The Audit Committee shall have one Chairman (Convener), who shall be an independent director appointed by the Board of Directors, responsible for presiding over the work of the committee. The Convener shall be a professional accountant.
Article 6 The Convener of the Audit Committee shall perform the following duties: (1) Convene and preside over committee meetings; (2) Review and sign the committee's reports; (3) Inspect the implementation of the committee's resolutions and recommendations; (4) Report the committee's work to the Board of Directors on behalf of the committee; (5) Other duties that should be performed by the Convener of the Audit Committee.
Article 7 The term of office of members of the Audit Committee shall be the same as the term of office of directors of the Board of Directors. Members may be re-elected upon the expiration of their term. If a member ceases to be a director of the Company during their term, they shall automatically lose their qualification as a member, and the Board of Directors shall supplement the number of members in accordance with the provisions of Articles 3 to 5.
Article 8 The Audit Committee shall establish an Audit Working Group, with the Internal Audit Department as the lead unit, responsible for daily liaison and meeting organization. Members of the working group need not be members of the Audit Committee.
Chapter 3 Responsibilities and Authority
Article 9 The Audit Committee shall have the following responsibilities: (1) Supervise and evaluate the work of external audit institutions; (2) Supervise and evaluate the work of internal audit; (3) Review the Company's financial reports and express opinions thereon; (4) Supervise and evaluate the Company's internal controls; (5) Coordinate communication between management, the internal audit department, relevant departments, and external audit institutions; (6) Other matters authorized by the Board of Directors and matters involving relevant regulations of laws and regulations and stock exchanges.