Fujian Aonong Biological Technology Group Incorporation Limited(603363)
Working rules of the audit committee of the board of directors
February, 2002
Working rules of the audit committee of the board of directors
Chapter I General Provisions
Article 1 in order to strengthen the decision-making function of the board of directors of Fujian Aonong Biological Technology Group Incorporation Limited(603363) (hereinafter referred to as “the company”), conduct prior audit, professional audit, avoid risks, realize the effective supervision of the company’s financial revenue and expenditure and various business activities, and improve the corporate governance structure, according to the company law of the people’s Republic of China (hereinafter referred to as “the company law”) The securities law of the people’s Republic of China, the notice of the State Council on Approving and transmitting the opinions of the CSRC on improving the quality of listed companies, the guidelines for the governance of listed companies, the stock listing rules of Shanghai Stock Exchange, the guidelines for the self-discipline supervision of listed companies of Shanghai Stock exchange No. 1 – standardized operation and other relevant laws and regulations Normative documents and the Fujian Aonong Biological Technology Group Incorporation Limited(603363) articles of Association (hereinafter referred to as the “articles of association”), the company establishes the audit committee of the board of directors (hereinafter referred to as the “Audit Committee”) and formulates these working rules.
Article 2 the audit committee is a special working organization established in accordance with the articles of association. It assists the board of directors in carrying out relevant work and is responsible to the board of directors within the scope of responsibilities specified in Article 13 of these rules.
Article 3 the members of the audit committee shall ensure sufficient time and energy to perform the duties of the committee, be diligent and responsible, effectively supervise and evaluate the internal and external audit work of the company, promote the company to establish effective internal control and provide true, accurate and complete financial reports.
Chapter II personnel composition
Article 4 the audit committee is composed of three directors, of which independent directors shall account for more than half and act as the convener. At least one independent director of the audit committee is an accounting professional. The convener of the audit committee shall be an accounting professional. Accounting professionals shall have rich accounting professional knowledge and experience and meet at least one of the following conditions:
(I) have the qualification of certified public accountant;
(II) having a senior professional title, associate professor or above or a doctor’s degree in accounting, auditing or financial management;
(III) have senior professional titles in economic management, and have more than 5 years of full-time working experience in professional posts such as accounting, audit or financial management.
All members of the audit committee must have professional qualifications competent for the duties of the audit committee
Professional knowledge and experience.
In principle, the members of the audit committee must be independent of the company’s daily operation and management.
Article 5 the members of the audit committee shall be nominated by the chairman, more than 1 / 2 independent directors or 1 / 3 of all directors and elected by the board of directors.
Article 6 the audit committee shall have one director, who shall be an independent director of the accounting profession, and shall be responsible for convening and presiding over the meetings of the Audit Committee; The chairman of the audit committee shall be elected from among the members of the audit committee and submitted to the board of directors for approval. When the chairman of the audit committee is unable or unable to perform his duties, he shall appoint one other member to act on his behalf; When the chairman of the audit committee neither performs his duties nor designates other members to perform his duties, any one member can report the relevant situation to the board of directors of the company, and the board of directors designates one member to perform the duties of the chairman of the audit committee.
Article 7 The term of office of the members of the audit committee is the same as that of the directors of the same board of directors, and they can be re elected. Before the expiration of a member’s term of office, he shall not be removed from office without reason unless there are circumstances that prohibit him from holding office as stipulated in the company law, the articles of association or these rules. If any member ceases to hold the position of director of the company during the period, he will automatically lose the qualification of member.
Article 8 if the number of members of the audit committee is lower than 2 / 3 of the specified number due to resignation, dismissal or other reasons, the board of directors of the company shall add new members in time.
Until the number of the audit committee does not reach 2 / 3 of the specified number, the audit committee shall suspend the exercise of its functions and powers specified in these rules.
Article 9 the internal audit department of the company is the daily office under the audit committee, which is responsible for daily work and liaison; The office of the board of directors assists in meeting organization and other work. The internal audit department is responsible to the audit committee and reports to the audit committee.
Article 10 the company shall allocate full-time personnel to engage in internal audit according to the company’s scale, production and operation characteristics and relevant regulations, and the number of full-time personnel shall not be less than 3.
Article 11 the provisions of the company law and the articles of association on the obligations of directors shall apply to the members of the audit committee. Article 12 the board of directors of the company shall regularly evaluate the independence and performance of the members of the audit committee, and may replace the members who are not suitable to continue to serve when necessary.
Chapter III responsibilities and authorities
Article 13 the main responsibilities and authorities of the audit committee are as follows:
（1） Supervise and evaluate the work of external audit institutions;
（2） Supervise and evaluate internal audit;
（3） Review and comment on the company’s financial report;
（4） Supervise and evaluate the company’s internal control;
（5） Coordinate the communication between management, internal audit department and relevant departments and external audit institutions;
（6） Other matters authorized by the board of directors and other matters involved in relevant laws and regulations.
Article 14 the responsibilities of the audit committee to supervise and evaluate the work of external audit institutions must at least include the following aspects:
（1） Assess the independence and professionalism of external audit institutions, especially the impact of non audit services provided by external audit institutions on their independence;
（2） Put forward suggestions to the board of directors on hiring or replacing external audit institutions;
（3） Review the audit fees and employment terms of external audit institutions;
（4） Discuss and communicate with external audit institutions on audit scope, audit plan, audit methods and major matters found in the audit;
（5） Supervise and urge the external audit institutions to be honest, trustworthy, diligent and responsible, strictly abide by the business rules and industry self-discipline norms, strictly implement the internal control system, verify and verify the company’s financial and accounting reports, perform the obligation of special attention, and prudently express professional opinions.
The audit committee shall hold a separate communication meeting with the external audit institution without the participation of management at least once a year. The Secretary of the board of directors may attend the meeting as nonvoting delegates.
Article 15 the duties of the audit committee in supervising and evaluating internal audit shall at least include the following aspects: (1) guiding and supervising the establishment and implementation of internal audit system;
（2） Review the company’s annual internal audit work plan;
（3） Supervise and urge the implementation of the company’s internal audit plan;
（4） Guide the effective operation of the internal audit department. The internal audit department of the company shall report its work to the audit committee, including but not limited to the implementation of the internal audit plan and the problems found in the internal audit work; Various reports submitted by the internal audit department to the management
The audit report, the rectification plan and rectification of audit problems shall be submitted to the audit committee at the same time;
（5） Report the progress and quality of internal audit and major problems found to the board of directors;
（6） Coordinate the relationship between the internal audit department and external audit units such as accounting firms and national audit institutions.
Article 16 the duties of the audit committee to review the company’s financial reports and express opinions on them must at least include the following aspects:
（1） Review the company’s financial report and put forward opinions on the authenticity, completeness and accuracy of the financial report;
（2） Focus on major accounting and audit issues of the company’s financial report, including major accounting error adjustment, major accounting policy and estimation changes, matters involving important accounting judgment, matters leading to non-standard unqualified audit report, etc;
（3） Pay special attention to the possibility of fraud, fraud and material misstatement related to financial reporting;
（4） Supervise the rectification of financial reporting problems.
Article 17 the responsibilities of the audit committee to supervise and evaluate the company’s internal control shall at least include the following aspects: (1) evaluate the appropriateness of the design of the company’s internal control system;
（2） Review the internal control self-evaluation report;
（3） Review the internal control audit report issued by the external audit institution, and communicate the problems found and improvement methods with the external audit institution;
（4） Evaluate the results of internal control evaluation and audit, and urge the rectification of internal control defects; （5） According to the internal audit report and relevant materials submitted by the internal audit department, issue a written evaluation opinion on the effectiveness of the company’s internal control and report to the board of directors.
Article 18 the responsibilities of the audit committee in coordinating the communication between the management, internal audit department and relevant departments and external audit institutions include:
（1） Coordinate the communication between management and external audit institutions on major audit issues;
（2） Coordinate the communication between internal audit department and external audit institutions and external auditors
Cooperation.
Article 19 Unless otherwise provided by laws and regulations, the audit committee of the board of directors shall supervise the internal audit department to inspect the following matters at least once every six months, issue an inspection report and submit it to the audit committee. If a listed company is found to have violations of laws and regulations or non-standard operation, it shall report to the Shanghai Stock Exchange in a timely manner:
(I) the implementation of major events such as the use of raised funds, provision of guarantees, related party transactions, securities investment and derivatives transactions, provision of financial assistance, purchase or sale of assets, foreign investment and so on;
(II) the company’s large amount of capital transactions and capital transactions with directors, supervisors, senior managers, controlling shareholders, actual controllers and their affiliates.
Article 20 the audit committee shall report to the board of directors on the measures or improvements it deems necessary and put forward suggestions.
Article 21 when the audit committee performs its duties, the company’s management and relevant departments shall cooperate. If the Audit Committee deems it necessary, it may hire an intermediary institution to provide professional opinions, and the relevant expenses shall be borne by the company.
Article 22 when the company hires or replaces an external audit institution, the audit committee must form a review opinion and put forward suggestions to the board of directors before the board of directors can review relevant proposals.
Chapter IV decision making procedures
Article 23 the Audit Department of the company shall be responsible for the preliminary preparations for the decision-making of the audit committee, and collect and provide written materials related to audit matters:
（1） Annual audit plan of the company;
（2） Relevant financial reports and other relevant materials of the company;
（3） Work reports of internal and external audit institutions;
（4） External audit contract and related work report;
（5） Information disclosed by the company;
（6） The company’s audit report on major related party transactions, independent financial adviser’s report, asset evaluation report and other relevant reports;
（7） Other relevant matters.
Article 24 the meeting of the audit committee shall evaluate the reports provided by the audit department and submit the discussion results to the public
Report to the board of directors for discussion:
（1） Work evaluation of external audit institutions, employment and replacement of external audit institutions;
（2） The company’s internal audit system and systems related to internal control and risk management; (
