Lanzhou Ls Heavy Equipment Co.Ltd(603169)
Internal control evaluation report in 2021
Lanzhou Ls Heavy Equipment Co.Ltd(603169) all shareholders:
According to the provisions of the basic norms of enterprise internal control and its supporting guidelines and other internal control supervision requirements (hereinafter referred to as the enterprise internal control standard system), combined with the internal control system and evaluation methods of the company (hereinafter referred to as the "company"), on the basis of daily and special supervision of internal control, We evaluated the effectiveness of the company's internal control on December 31, 2021 (the benchmark date of the internal control evaluation report). I Important statement
It is the responsibility of the board of directors of the company to establish, improve and effectively implement internal control, evaluate its effectiveness and truthfully disclose the internal control evaluation report in accordance with the provisions of the enterprise's internal control standard system. The board of supervisors shall supervise the establishment and implementation of internal control by the board of directors. The management is responsible for organizing and leading the daily operation of the enterprise's internal control. The board of directors, the board of supervisors and the directors, supervisors and senior managers of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this report, and bear individual and joint legal liabilities for the authenticity, accuracy and completeness of the contents of the report.
The objective of the company's internal control is to reasonably ensure the legal compliance of operation and management, asset safety, authenticity and integrity of financial reports and relevant information, improve operation efficiency and effect, and promote the realization of development strategy. Due to the inherent limitations of internal control, it can only provide reasonable assurance for the realization of the above objectives. In addition, as changes in circumstances may lead to inappropriate internal control or reduced compliance with control policies and procedures, there is a certain risk to speculate the effectiveness of internal control in the future according to the internal control evaluation results. II Internal control evaluation conclusion 1 On the benchmark date of the internal control evaluation report, does the company have any major defects in the internal control of financial reporting
□ yes √ no
2. Evaluation conclusion of internal control over financial reporting
√ valid □ invalid
According to the identification of major defects in the company's internal control over financial reporting, there are no major defects in the internal control over financial reporting on the benchmark date of the internal control evaluation report. The board of Directors believes that the company has maintained effective internal control over financial reporting in all major aspects in accordance with the requirements of the enterprise's internal control standard system and relevant regulations.
3. Whether major defects in internal control over non-financial reporting are found
□ yes √ no
According to the identification of major defects in the company's internal control over non-financial reports, the company found no major defects in the company's internal control over non-financial reports on the benchmark date of the internal control evaluation report. 4. Factors affecting the evaluation conclusion of internal control effectiveness from the benchmark date of internal control evaluation report to the date of issuance of internal control evaluation report □ applicable √ not applicable
There are no factors affecting the evaluation conclusion of the effectiveness of internal control from the base date of the internal control evaluation report to the date of issuance of the internal control evaluation report. 5. Whether the internal control audit opinion is consistent with the company's evaluation conclusion on the effectiveness of internal control over financial reporting
√ yes □ No 6 Whether the disclosure of major defects in internal control of non-financial reports in the internal control audit report is consistent with the disclosure of the company's internal control evaluation report √ yes □ no III Internal control evaluation (I) Scope of internal control evaluation
According to the risk oriented principle, the company determines the main units, businesses and matters included in the evaluation scope and high-risk areas. 1. The main units included in the evaluation scope include: the headquarters of the company, Qingdao Lanshi Heavy Machinery Co., Ltd., Xinjiang Lanzhou Ls Heavy Equipment Co.Ltd(603169) Energy Engineering Co., Ltd., Lanzhou Lanshi heat exchange equipment Co., Ltd., Lanzhou Lanshi Heavy Industry Co., Ltd., Lanzhou Lanshi Testing Technology Co., Ltd., Lanzhou Lanshi environmental Protection Engineering Co., Ltd., Luoyang Ruize Petrochemical Engineering Co., Ltd Lanzhou Lanshi Zhiyuan Machinery Technology Co., Ltd. and China Nuclear Jiahua Equipment Manufacturing Co., Ltd. 2. Proportion of units included in the scope of evaluation:
Proportion of indicators (%)
The ratio of the total assets of the units included in the evaluation scope to the total assets of the company's consolidated financial statements 100
The total operating income of the units included in the evaluation scope accounts for 100% of the total operating income in the company's consolidated financial statements
3. The main operations and matters included in the scope of evaluation include:
Internal environment, risk assessment, information and communication, internal supervision, fund management, financing management, procurement management, inventory management, business outsourcing management, cost management, sales management, budget management, human resources management, engineering project management, fixed assets management, intangible assets management, related party transaction management, financial report, R & D management, contract management Control of subsidiaries, social responsibility, etc. 4. High risk areas of focus mainly include:
Internal environment, fund management, procurement management, sales management, engineering projects, fixed assets, financial reports and contract management.
5. The above units, businesses and matters included in the evaluation scope and high-risk areas cover the main aspects of the company's operation and management. Is there any major omission
□ yes √ No 6 Is there a statutory exemption
□ yes √ No 7 Other explanatory matters
None (II) Basis of internal control evaluation and identification standard of internal control defects
The company organizes and carries out internal control evaluation according to the enterprise internal control standard system and the company's internal control system and evaluation methods. 1. Whether the specific identification standard of internal control defects is adjusted with that of previous years
□ yes √ no
According to the identification requirements of the enterprise internal control standard system for major defects, important defects and general defects, and in combination with the company's scale, industry characteristics, risk preference, risk tolerance and other factors, the board of directors of the company distinguished internal control over financial reports from internal control over non-financial reports, and studied and determined the specific identification standards of internal control defects applicable to the company, And consistent with previous years. 2. Identification standard of internal control defects in financial reporting
The quantitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Index name major defect quantitative standard important defect quantitative standard general defect quantitative standard
Potential misstatement of total profit ≥ 5% of total profit ≤ 2% of total profit ≤ misstatement ＜ profit misstatement ＜ 2% of total profit ＜ 5% of total profit
Potential misstatement of total assets ≥ 3% of total assets ≤ 1% of total assets ＜ 1% of total assets ＜ 3% of total assets
Potential misstatement of operating income ≥ 3% of operating income ≤ 1% of operating income ＜ 1% of operating income ＜ 3% of operating income
Potential misstatement of owner's equity: misstatement ≥ 3% of owner's equity, 1% of owner's equity ≤ misstatement < misstatement < 1% of owner's equity, 3% of owner's equity
explain:
nothing
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Qualitative standard of defect nature
1. Fraud by directors, supervisors and senior managers; 2. Correct the major defects and misstatement of the major errors in the announced financial report; 3. There is a material misstatement in the current financial report, but the internal control fails to find the misstatement in the operation process; 4. The supervision of the audit committee and the internal audit department on the internal control of financial reporting is invalid.
1. Failure to select and apply accounting policies in accordance with generally accepted accounting standards; 2. Failure to establish anti fraud procedures and control measures; 3. Major defects: no corresponding control mechanism has been established or implemented for the accounting treatment of unconventional or special transactions, and there is no corresponding compensatory control; 4. There are one or more defects in the control of the financial reporting process at the end of the period, and it can not reasonably ensure that the prepared financial statements achieve the goal of authenticity and accuracy.
General defects are other control defects other than the above major defects and important defects.
explain:
None 3 Identification standard of internal control defects in non-financial reporting
The quantitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
Index name major defect quantitative standard important defect quantitative standard general defect quantitative standard
The amount of loss is 10 million yuan and from 5 million yuan (including more than 5 million yuan) to 10 million yuan
explain:
nothing
The qualitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
Qualitative standard of defect nature
1. The company lacks democratic decision-making procedures; 2. Major mistakes caused by the company's decision-making procedures; 3. The company's important business lacks major defect control or the system fails; 4. Major or important defects in the company's internal control have not been rectified; 5. The company is punished by the CSRC or warned by the stock exchange.
1. The company's democratic decision-making procedures exist but are not perfect; 2. General mistakes caused by the company's decision-making procedures; 3. The company's important defects violate the internal rules and regulations of the enterprise, resulting in losses; 4. There are defects in the company's important business system or system; 5. Major or general defects in the company's internal control have not been rectified.
General defects 1 The efficiency of the company's decision-making procedure is not high; 2. The company violates the internal rules and regulations, but no loss is caused; 3. There are defects in the company's general business system or system; 4. General defects of the company have not been rectified; 5. The company has other defects.
explain:
None (III) Identification and rectification of internal control defects 1 Identification and rectification of internal control defects in financial reporting 1.1 Major defects
Whether the company has any major defects in internal control over financial reporting during the reporting period
□ yes √ no 1.2 Important defects
Whether the company has any significant defects in internal control over financial reporting during the reporting period
□ yes √ no 1.3 General defect
None 1.4 After the above rectification, on the benchmark date of the internal control evaluation report, does the company have any major defects in the internal control of financial reporting that have not been rectified
□ yes √ no 1.5 After the above rectification, on the benchmark date of the internal control evaluation report, does the company have any important defects in the internal control of financial reporting that have not been rectified
□ yes √ no
2. Identification and rectification of internal control defects in non-financial reporting 2.1 Major defects
Whether the company found any major defects in internal control over non-financial reporting during the reporting period
□ yes √ no
2.2. Important defects
Whether the company found any significant defects in internal control over non-financial reporting during the reporting period
□ yes √ no 2.3 General defect
None 2.4 After the above rectification, on the benchmark date of the internal control evaluation report, does the company find any major defects in non-financial reporting internal control that have not been rectified
□ yes √ no 2.5 After the above rectification, on the benchmark date of the internal control evaluation report, does the company find any important defects in the internal control of non-financial reporting that have not been rectified
□ yes √ no IV Description of other major matters related to internal control 1 Rectification of internal control defects in the previous year
□ applicable √ not applicable 2 Operation of internal control in this year and improvement direction in the next year
□ applicable √ not applicable 3 Description of other major events
□ applicable √ not applicable
Chairman (authorized by the board of directors): Zhang Pulin Lanzhou Ls Heavy Equipment Co.Ltd(603169) February 19, 2022
