Securities code: 002515 securities abbreviation: Jinzi Ham Co.Ltd(002515) Announcement No.: 2022-012 Jinzi Ham Co.Ltd(002515)
Announcement on the reply to the letter of concern of Shenzhen Stock Exchange
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
On January 28, 2022, the board of directors of Jinzi Ham Co.Ltd(002515) (hereinafter referred to as "the company") received the attention letter on Jinzi Ham Co.Ltd(002515) from Shenzhen Stock Exchange (company Department attention letter [2022] No. 71, hereinafter referred to as "attention letter"), attached great importance to it and carefully checked the relevant situation. Now the relevant situation is replied as follows:
Question 1: explain whether your company's internal control system and risk management measures for commodity futures hedging business are perfect and can effectively control risks. Combined with the implementation of relevant systems of your company's commodity futures hedging business, including but not limited to transaction content, specific transaction amount, this closing operation, etc, Explain whether there are major defects in your company's internal control. Ask the annual audit accountant to check and give clear opinions. [reply]
1、 Explain whether the internal control system and risk management measures established by your company for commodity futures hedging business are perfect and whether they can effectively control risks
On January 11, 2021, the 10th meeting of the 5th board of directors of the company deliberated and adopted the proposal on formulating the internal control system of futures hedging business. In accordance with the guidelines for the standardized operation of listed companies of Shenzhen Stock Exchange (revised in 2020), the company has formulated the internal control system for commodity futures hedging business, which clearly stipulates the approval authority, internal audit process and risk treatment procedures of hedging business, as follows:
1. The company sets up a "futures decision-making group" to manage the futures hedging business of the company. The members of the "futures decision-making group" include the chairman, President, vice president, person in charge of procurement, person in charge of finance, person in charge of internal audit, etc; The board of directors authorizes the chairman to take charge of futures hedging business and act as the head of the "futures decision-making group". 2. The company sets up a "futures working group", which is responsible for hedging according to the decision of the "futures decision group". The finance department and the internal audit department set up corresponding posts for futures hedging trading business, which are responsible for the specific implementation of hedging business. The main posts include futures traders, risk managers, fund allocators, accountants and archivists, Futures traders are responsible for specific futures trading operations.
3. In terms of risk management measures for commodity futures hedging business, the company clearly:
(1) The futures hedging business of the company is limited to pig futures traded in domestic futures exchanges. The futures position shall not exceed the spot demand for hedging. In principle, the time period of futures position shall match the time period of risk in the spot market.
(2) The company establishes a hedging transaction account in its own name, uses its own funds, and does not use the raised funds to hedge directly or indirectly. Strictly control the capital scale of hedging business, reasonably plan and use the margin, supervise and control the investment proportion of margin, and close the position in time in case of severe market fluctuations to avoid risks.
(3) The company focuses on futures trading and reasonably selects contract months to avoid market liquidity risk.
(4) The internal audit department of the company shall regularly and irregularly inspect the hedging transaction business, supervise the hedging transaction business personnel to implement risk management policies and risk management procedures, and timely prevent operational risks in the business.
(5) The company arranges and uses professionals in strict accordance with the relevant internal control system, establishes a strict authorization and post restraint mechanism, strengthens the professional ethics education and business training of relevant personnel, and improves the comprehensive quality of relevant personnel.
(6) In order to improve the sense of responsibility of futures traders and standardize the company's futures trading management, the company formulated the assessment measures for the operation of futures hedging business before opening the futures account, and defined the relevant reward and punishment measures for futures traders.
In conclusion, we believe that the internal control system and risk management measures established by the company for commodity futures hedging business are perfect and can effectively control risks.
2、 In combination with the implementation of the relevant systems of your company's commodity futures hedging business, including but not limited to the trading content, specific trading quota, this closing operation, explain whether there are major defects in your company's internal control
According to the basic norms of enterprise internal control, guidelines for evaluation of enterprise internal control and other laws and regulations, the articles of association and the company's internal control management system, major defects refer to the high possibility of defects, which will seriously reduce the work efficiency or effect, or seriously increase the uncertainty of the effect, or make it seriously deviate from the expected goal; Important defects refer to the high possibility of defects, which will significantly reduce the work efficiency or effect, or significantly increase the uncertainty of the effect, or make it significantly deviate from the expected goal; General defects refer to defects that are less likely to occur, which will reduce work efficiency or effect, increase the uncertainty of effect, or make it deviate from the expected goal.
1. Trading contents of the company's commodity futures hedging business
(1) The company carried out commodity futures hedging business this time. In terms of futures variety selection, the company carried out pig futures hedging business. Pigs are Shenzhen Agricultural Products Group Co.Ltd(000061) directly and important related to the production and operation of the company, which meets the requirements of the resolution of the board of directors and the internal control system of the company.
(2) In terms of the month selection of futures contracts, the company mainly buys lh2203 and lh2111 contracts, which are also based on the judgment of pork price and the actual operation needs of the company.
2. Trading quota of the company's commodity futures hedging business
According to the resolution of the 10th meeting of the 5th board of directors on January 11, 2021, the company will carry out pig futures hedging business with its own and self raised funds within the limit of 50 million yuan (excluding physical delivery of futures subject matter) within one year from the date of deliberation and approval by the board of directors; For commodity futures hedging business, in principle, the position established in the futures market matches the company's spot operation demand in a certain period of time; At any time point, the net long position or net short position established in the futures market shall not exceed 2 / 3 of the consumption in the next year in principle.
The trading of the company's commodity futures hedging business in 2021 is as follows:
Project may 2021 June 2021 July 2021 August 2021 September 2021
Total net investment of 2000000.00 -1670000.00 4670000.00 45000000.00 20000000.00 in the current month (yuan)
Position at the end of the month 32 tons (2 hands) 32 tons (2 hands) 16272 tons
(1017 hands)
Note: since the implementation of position closing in September 2021, the company has transferred the surplus funds in the futures account to the account of Agricultural Bank Of China Limited(601288) Jinhua Branch and suspended the commodity futures hedging business.
It can be seen from the above table that as of August 31, 2021, the margin of the company's futures account did not exceed 50 million yuan and did not exceed the authority authorized by the board of directors; On September 1, 2021, the company decided to carry out physical delivery of the held contracts. Due to the continuous decline of the price of futures varieties, in order to prevent passive closing, the company added 20 million yuan to the futures account in batches in the first ten days of September 2021, which is the additional guarantee Fund for the physical delivery of the held contracts, which meets the requirements of the company's internal control system. In terms of positions under construction, as of August 31, 2021, the company's position was 16272.00 tons (1017.00 hands), which was lower than 2 / 3 of the company's purchase volume in 2020 and the planned purchase volume in 2021. However, due to the continuous decline of pig spot price in 2021, the development of the company's brand meat business did not meet expectations, so it did not fully match the actual purchase volume of the company in the spot market in 2021.
3. Closing positions of the company's commodity futures hedging business
(1) Since the middle of September 2021, due to the sharp decline of pig prices in the futures and spot markets, the futures traders were too pessimistic about the future market and closed the positions of the held contracts without the company's closing instructions, trying to rebuild the positions at a lower price. Finally, the company's account suffered a total loss of 55.1053 million yuan. It was not until September 27, 2021 that the futures trader reported the relevant situation to the company and promised to bear all losses according to the relevant assessment methods.
(2) After knowing the relevant situation at the first time, the company immediately issued a notice to the futures traders, requiring them to bear all losses according to the assessment methods, otherwise they will be investigated for legal responsibility. On September 30, 2021, the company fully recovered the above losses, thus causing no actual economic losses to the company. Since October 2021, the company has not carried out pig futures hedging business. However, the company failed to disclose the information of the relevant matters in time due to the understanding deviation of the relevant matters. The company has dissuaded the futures traders in November 2021, and recently investigated the corresponding responsibilities of the main members of the futures decision-making group and the futures working group in this incident according to their work responsibilities.
To sum up, the company has established internal control system and risk management measures for commodity futures hedging business. The development of the company's commodity futures hedging business basically meets the requirements of the resolution of the board of directors and the company's internal control system, and there are no major deficiencies in the company's internal control as a whole. Although the company suffered losses due to the illegal closing operation of futures traders, and the compensation paid by futures traders has been received in time in accordance with the relevant assessment measures, thus avoiding the actual losses of the company, the company is deeply aware that there are still some deficiencies and defects in the provisions and implementation of the internal control system of futures hedging business. First, the company conducted commodity futures hedging business and failed to make timely adjustment according to the market conditions when building positions in the futures market, resulting in deviation from the actual operating demand of the company in a certain period of time; Second, the daily supervision and control of futures traders need to be strengthened. The operation authority of futures traders needs to be further controlled and refined. At the same time, the supervision and inspection of futures accounts should be strengthened, and the futures accounts should be reconciled and inspected regularly to find abnormal and illegal transactions in time; Third, if the accounting treatment of important matters of the company's commodity futures hedging business is wrong or not timely and not disclosed in time, relevant personnel need to strengthen business learning to ensure timely and accurate disclosure of relevant information.
Futures hedging business is the first financial derivatives trading variety contacted by the company. Due to the lack of deep understanding of the trading variety and its risk exposure, the company simply selects the pig procurement link of the company to carry out hedging business, and habitually guides the hedging business in the way of spot thinking, Therefore, under the unilateral decline of pig spot and futures in 2021, it failed to achieve the expected goal of hedging, which has brought profound lessons to the company. The company will take this incident as an alarm, draw lessons, check omissions and fill vacancies, improve scientific decision-making ability, improve system, deepen supervision, practically strengthen internal control, improve corporate governance level and promote high-quality development of the company.
3、 Annual audit accountant's opinion
After verification, we believe that the company has established internal control system and risk management measures for commodity futures hedging business. Although the company has suffered losses due to the illegal closing operation of futures traders, and in view of the fact that the compensation paid by futures traders has been received in time in accordance with the relevant assessment measures, so as to avoid the actual losses of the company, the following internal control defects still exist:
1. When the company conducts commodity futures hedging business, it fails to make timely adjustment according to the market situation when building positions in the futures market, resulting in deviation from the actual operating demand of the company in a certain period of time;
2. The daily supervision and control of futures traders need to be strengthened. The operation authority of futures traders needs to be further controlled and refined. At the same time, the supervision and inspection of futures accounts should be strengthened, and the futures accounts should be reconciled and inspected regularly to find abnormal and illegal transactions in time;
3. If the accounting treatment of important matters of the company's commodity futures hedging business is wrong or not timely and not disclosed in time, relevant personnel need to strengthen business learning to ensure timely and accurate disclosure of relevant information.
See the special note of Tianjian Certified Public Accountants on the letter of concern of Shenzhen Stock Exchange disclosed on the same day for the specific opinions of the annual audit accountants.
Question 2: explain the specific time when the futures traders of your company closed the positions of the contracts they held without authorization, and the reason and rationality of your company's failure to fulfill the obligation of information disclosure in time.
[reply]
After inquiring the futures trading records, the futures traders of the company closed the positions of the contracts they held without authorization, and the time when there was a large investment loss was September 16, 2021.
Since September 2021, the pig futures index has continued to decline unilaterally from 16075 points. On September 16, 2021, the pig futures index fell rapidly from 14172 points at the opening to 13798 points. The company's futures traders were under great pressure and worried about the risk of compulsory liquidation of the company's position contracts. In the morning of that day, the futures trader sold a total of 902 pig contracts without asking for instructions from any member of the futures decision-making group, and tried to rebuild the position at a lower price, resulting in an actual investment loss of about 44.22 million yuan on that day. The time for futures traders to report the above matters to the company and promise to compensate the company for all losses is September 27, 2021. On September 29 and 30, 2021, the futures traders paid the corresponding losses to the company's account.
Since the launch of this futures hedging business, in terms of trading operation, the account trading operation has been reviewed and confirmed by the daily trading report before the end of August 2021, and it will be completed on August 24, 2021
