Ganzhou Tengyuan Cobalt New Material Co., Ltd. 2025 Annual Internal Control Evaluation Report
To all shareholders of Ganzhou Tengyuan Cobalt New Material Co., Ltd.:
Pursuant to the "Basic Norms for Enterprise Internal Control" and its supporting guidelines, as well as other internal control regulatory requirements (hereinafter referred to as the "Internal Control System"), and in conjunction with Ganzhou Tengyuan Cobalt New Material Co., Ltd.'s (hereinafter referred to as the "Company" or "This Company") internal control system and evaluation methods, based on daily and special supervision of internal controls, we have evaluated the effectiveness of the Company's internal controls as of December 31, 2025 (the "Evaluation Date").
I. Important Statement
In accordance with the requirements of the Internal Control System, establishing and effectively implementing internal controls, evaluating their effectiveness, and truthfully disclosing the internal control evaluation report are the responsibilities of the Company's Board of Directors. The 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 the content of this report contains no false statements, misleading representations, or significant omissions, and they bear individual and joint legal responsibility for the truthfulness, accuracy, and completeness of the report's content.
The objective of the Company's internal control is to reasonably ensure the legality and compliance of business operations, the safety of assets, and the truthfulness and completeness of financial reports and related information, thereby improving operational efficiency and effectiveness and promoting the achievement of development strategies. Due to the inherent limitations of internal control, it can only provide reasonable assurance for the achievement of these objectives. Furthermore, changes in circumstances may render internal controls inappropriate, or the degree of compliance with control policies and procedures may decrease, and there is a certain risk in inferring the future effectiveness of internal controls based on the results of the internal control evaluation.
II. Conclusion of Internal Control Evaluation
Based on the determination of material weaknesses in the Company's financial reporting internal controls, as of the Evaluation Date, no material weaknesses in financial reporting internal controls were found. 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 Internal Control System and relevant regulations.
Based on the determination of material weaknesses in the Company's non-financial reporting internal controls, as of the Evaluation Date, no material weaknesses in non-financial reporting internal controls were found.
No factors have occurred between the Evaluation Date and the issuance date of this internal control evaluation report that affect the conclusion of the internal control effectiveness evaluation.
III. Scope of Internal Control Evaluation
The Company determines the main entities, businesses, and matters, as well as high-risk areas, included in the evaluation scope based on a risk-oriented approach. The main entities included in the evaluation scope are: the Company and its subsidiaries. The total assets of the entities included in the evaluation scope account for 100% of the Company's consolidated financial statement assets, and the total operating income accounts for 100% of the Company's consolidated financial statement operating income. Important businesses and matters included in the evaluation scope are: internal environment, risk assessment, control activities, information transmission and communication, and internal supervision, specifically including:
(I) Internal environment, including: governance structure, organizational structure, human resources, corporate culture, and social responsibility;
(II) Risk assessment, mainly including identifying and assessing the internal and external risks faced by the Company;