Important Statement
According to the provisions of the enterprise internal control standard system, establishing, improving, and effectively implementing internal controls, evaluating their effectiveness, and truthfully disclosing the internal control evaluation report is the responsibility of the company's board of directors. The audit committee supervises the establishment and implementation of internal controls by the board. The management is responsible for organizing and leading the daily operation of internal controls. The board of directors, directors, and senior management ensure that the content of this report does not contain any false records, misleading statements, or significant omissions, and bear individual and joint legal responsibility for the truthfulness, accuracy, and completeness of the report. The goal of the company's internal control is to reasonably ensure that business management is legal and compliant, assets are secure, financial reporting and related information are true and complete, operational efficiency and effectiveness are improved, and development strategies are promoted. Due to inherent limitations in internal controls, they can only provide reasonable assurance of achieving the above goals. Additionally, changes in circumstances may render internal controls inappropriate or reduce compliance with control policies and procedures, making it risky to infer the future effectiveness of internal controls based on evaluation results.
Internal Control Evaluation Conclusion
Based on the identification of significant deficiencies in financial reporting internal controls, as of the evaluation report benchmark date, there are no significant deficiencies in financial reporting internal controls. The board believes that the company has maintained effective financial reporting internal controls in all material respects in accordance with the requirements of the enterprise internal control standard system and related regulations. Based on the identification of significant deficiencies in non-financial reporting internal controls, as of the evaluation report benchmark date, the company has not identified any significant deficiencies in non-financial reporting internal controls. No factors affecting the evaluation conclusion of internal control effectiveness have occurred between the evaluation report benchmark date and the issuance date of the evaluation report.
Internal Control Evaluation Work Situation
(1) Scope of Internal Control Evaluation
The company determines the main units, businesses, and high-risk areas included in the evaluation scope based on a risk-oriented principle. The units included in the evaluation scope are the company and its holding subsidiaries. The total assets of the units included in the evaluation scope account for 100% of the total assets in the consolidated financial statements, and the total operating income accounts for 100% of the total operating income in the consolidated financial statements. The main businesses and matters included in the evaluation scope are: internal environment, human resources, social responsibility, financing management, investment management, fund operations, guarantees, procurement management, outsourcing processing, inventory management, fixed assets, intangible assets, sales business, R&D management, engineering projects, financial reporting, contract management, information systems, internal supervision, etc. The high-risk areas focused on include fund activities, procurement business, inventory management, fixed assets, sales business, engineering projects, financial reporting, etc. The specific main businesses and matters included in the evaluation scope are as follows: