Shandong Hongchuang Aluminum Industry Holding Company Limited(002379)
Self evaluation report on internal control in 2021
Shandong Hongchuang Aluminum Industry Holding Company Limited(002379) 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 Shandong hongchuang Aluminum Holding Co., Ltd. (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).
1、 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.
2、 Internal control evaluation conclusion
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. 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.
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.
3、 Internal control evaluation
The board of directors of the company authorizes the audit department to be fully responsible for internal audit, evaluate the efficiency and effect of internal control design and implementation through routine audit, special audit or special investigation, supervise and inspect the effectiveness of the company's internal control design and operation, and promote the continuous improvement and improvement of the quality of internal control. Report the internal control defects found in the audit or investigation to the management, the audit committee and the board of supervisors according to the nature of the defects and the established reporting procedures, and urge relevant departments to take positive measures to improve and optimize them. (I) evaluation scope of internal control
According to the risk oriented principle, the company determines the main units, businesses and matters included in the evaluation scope and high-risk areas. The units included in the evaluation scope include: parent company and subsidiaries Binzhou Hongbo Aluminum Technology Co., Ltd., Zouping HONGZHUO Aluminum Industry Co., Ltd., Zouping Hongcheng Aluminum Technology Co., Ltd. and Zouping Hongshuo Aluminum Industry Co., Ltd. The total assets of the units included in the evaluation scope account for 100% of the total assets in the company's consolidated financial statements, and the total operating revenue accounts for 100% of the total operating revenue in the company's consolidated financial statements; The main businesses and matters included in the evaluation scope include: corporate governance, organizational structure, independent director system and its implementation, key business control activities, internal audit, human resources policies and practices and corporate culture; The high-risk areas of focus mainly include related party transactions, guarantee business, major investment and information disclosure.
1. Corporate governance
According to the requirements of the company law, securities law and other laws and regulations, the company has established a relatively perfect corporate governance structure, with clear rights and responsibilities between the power organization, decision-making organization and supervision organization and the management, performing their respective duties, mutual checks and balances, scientific decision-making and coordinated operation. In terms of corporate governance, the company has formulated the articles of association, rules of procedure of the general meeting of shareholders, rules of procedure of the board of directors, rules of procedure of the board of supervisors, working rules of the general manager, working system of independent directors and other major rules and regulations to ensure the standardized operation and healthy development of the company.
2. Organizational structure
In accordance with the company law of the people's Republic of China, the company has established the general meeting of shareholders, the board of directors and the board of supervisors to perform the functions of decision-making, management and supervision respectively. At the same time, it has a strategy committee, a nomination, assessment, remuneration committee and an audit committee, which are directly responsible for the board of directors. According to the needs of the company's business development, internal control and business characteristics, the company has set up functional departments such as human resources department, administration department, finance department, procurement department, sales department, production control center, equipment safety and environment management department, production branch, information department, audit department and Securities Department, and formulated corresponding post responsibilities. Each functional department has a clear division of labor, performs its own duties, assumes its own responsibilities, cooperates with each other and checks and balances each other, ensuring the orderly and healthy operation of the company's production and operation activities and the realization of control objectives. 3. Independent director system and its implementation
The company has formulated the working system of independent directors, which is constantly updated according to the requirements of relevant new laws and regulations. At present, the company's current effective working system of independent directors is legal and compliant, and the provisions on the qualifications and terms of reference of independent directors meet the relevant requirements of the CSRC. At present, the independent directors of the company are Sun Nan, Liu Jianwen and Deng Yan, who have obtained the certificate of completion of independent director training of listed companies. The independent directors of the company have the necessary knowledge base to perform their duties, comply with the relevant provisions of the CSRC, and can perform the duties of independent directors in the decision-making of the board of directors, including major related party transactions, external guarantees Express independent opinions on the company's development strategy and decision-making mechanism, the appointment and dismissal of senior managers and give full play to the role of independent directors.
4. Key business control activities
(1) Purchase and payment activity control
The company regularly reviews suppliers and determines a number of high-quality suppliers through appropriate price comparison. The rights and responsibilities of payment for goods are clear, and the internal control system of purchase and payment is formulated and effectively implemented, which prevents fraud and errors in the process of purchase and payment, makes it flow orderly and pay appropriately, and effectively ensures the accuracy of cost and the safety and integrity of the company's assets.
(2) Control of sales and collection activities
The company has formulated the sales and collection management system, which clearly stipulates the post setting and division of labor, sales and collection management and other related contents. In all links involved in the whole sales and collection cycle, the company has clarified their respective rights and responsibilities and mutual restraint measures from sales budget, approval and signing of sales contract and contract management, issuance and management of sales invoice, confirmation of sales payment, withdrawal and relevant accounting records, provision and approval of bad debt reserves of accounts receivable to write off and approval of bad debts.
(3) Fixed assets management control
The company has established the authorization and approval system for fixed assets business, defined the authorization and approval methods, procedures and relevant control measures, and stipulated the authority and responsibility of the approver, as well as the scope of responsibility and work requirements of the handler.
Strict control procedures are designed for the procurement, storage and accrual of accumulated depreciation of fixed assets to ensure the safety of assets and the accuracy of valuation.
(4) Control of financial management and reporting activities
The company has prepared financial management system and information disclosure management system, which standardize the maintenance of accounting subjects, daily accounting, financial settlement, preparation and external provision of financial reports, financial analysis and data archiving, and clarify the division of responsibilities and post separation of all links of financial reports, as well as scientific and reasonable organization setting and staffing.
(5) Management control of holding subsidiaries
In accordance with the provisions of laws, regulations and the articles of association of subsidiaries, the company controls the establishment, investment change management and management of subsidiaries (including standardized operation, personnel management, finance, capital and guarantee management, investment management, information management, internal audit supervision, performance appraisal and incentive contract system), and the management of joint-stock companies. In addition to supervising whether the daily operation and management activities of the holding subsidiaries strictly comply with the provisions of relevant systems, the company focuses on the legal compliance and efficiency of the holding subsidiaries involved in major economic activities such as major contracts, major capital expenditures and major losses, so as to improve the overall operation efficiency and risk resistance ability of the company. The major business and financial matters of each subsidiary have been submitted to the parent company at the first time in accordance with the regulations, and the financial reports have been submitted regularly.
(6) Control of related party transactions
In accordance with the relevant provisions of the stock listing rules and the articles of association of Shenzhen Stock Exchange, the company has formulated the related party transaction decision-making system, which stipulates the basic principles to be followed in related party transactions, the scope of related parties, the content of related party transactions, the pricing principles of related party transactions, and defines the approval authority and decision-making procedures of the general meeting of shareholders, the board of directors and the chairman of the board of directors The information disclosure of related party transactions ensures the fairness and rationality of related party transactions and effectively protects the interests of the company and minority shareholders.
The company has stipulated the approval authority of related party transactions in the articles of association. The related party transactions with the amount of transactions between the company and related parties of more than 30 million yuan and accounting for more than 5% of the latest audited net asset value of the company (except for the guarantee provided by the company and cash assets donated by the company) shall be submitted to the general meeting of shareholders for deliberation. The deliberation procedures and voting avoidance requirements of the company's related party transactions shall be implemented in accordance with the articles of association, the company's related party transaction decision-making system and other relevant provisions.
(7) Control of external guarantee
The company has established the external guarantee management system, which strictly stipulates the approval authority and procedures of external guarantee. The company's external guarantee management adopts a multi-level audit and supervision system. The relevant departments and responsibilities of the company include: the finance department is the audit and daily management department of the company's external guarantee, which is responsible for accepting and reviewing the guarantee applications submitted by all the guaranteed persons, as well as the daily management and continuous risk control of external guarantee; The office of the board of directors is the Department responsible for the compliance review of the company's external guarantees and relevant information disclosure, responsible for the compliance review of the company's external guarantees, organizing the implementation of the approval procedures of the board of directors or the general meeting of shareholders and fulfilling the obligations of relevant information disclosure; As the supervision and inspection department of the company's external guarantee, the audit department is responsible for checking whether the provisions of the internal control system of guarantee business have been effectively implemented, effectively preventing the company's external guarantee risks and safeguarding the interests of the company and shareholders.
The company has stipulated the approval authority of external guarantee in the articles of association. When submitting external guarantee to the board of directors for deliberation, it shall obtain the consent of more than two-thirds of the directors attending the meeting of the board of directors and more than two-thirds of all independent directors. The following external guarantees of the company shall be deliberated and approved by the general meeting of shareholders.
① Any guarantee provided after the total amount of external guarantee of the company and its holding subsidiaries reaches or exceeds 50% of the latest audited net assets;
② Any guarantee provided after the total amount of external guarantee of the company reaches or exceeds 30% of the latest audited total assets;
③ The guarantee provided for the guarantee object whose asset liability ratio exceeds 70%;
④ The amount of a single guarantee exceeds 10% of the latest audited net assets;
⑤ Guarantee provided to shareholders, actual controllers and their related parties.
(8) Control over the use of raised funds
In order to regulate the management and use of the company's raised funds and protect the interests of investors, the company has, in accordance with the provisions of the company law, the securities law, the provisions on the report on the use of the previously raised funds, the notice on further regulating the use of the raised funds of listed companies, the stock listing rules of Shenzhen Stock Exchange and other relevant laws, regulations and normative documents, The management system for raised funds has been formulated, which strictly stipulates the storage, use, approval procedures, investment direction change, supervision and other aspects of the special account for raised funds, so as to ensure that the storage and use of raised funds comply with relevant regulations and improve the use efficiency of raised funds.
In 2021, the company did not use the raised funds.
(9) Control of major investment
The internal control of the company's foreign investment follows the principles of legality, prudence, safety and effectiveness, and earnestly performs strict investment decision-making, supervision and management procedures, controls investment risks and pays attention to investment benefits in accordance with the company law, securities law, articles of association and other laws, regulations and rules.
The company stipulates in the articles of association that the total amount of individual funds for foreign investment, acquisition and sale of assets and asset mortgage for company financing (or the cumulative amount of similar transactions for 12 consecutive months) accounts for more than 10% and less than 30% of the company's total assets audited in the latest period shall be approved by the board of directors; If it accounts for more than 30% of the company's total assets audited in the latest period, the board of directors shall put forward a plan and submit it to the general meeting of shareholders for approval. (10) Control of information disclosure
The company has formulated the company's information disclosure management system and insider information management system in accordance with the company law, the securities law, the measures for the administration of information disclosure of listed companies and the stock listing rules of Shenzhen Stock Exchange. Clarify and standardize the management of the company's information disclosure, the content, procedures, division of responsibilities, confidentiality measures and file management of the information disclosure, so as to ensure that the company obtains the information in a timely, accurate and complete manner and performs the obligation of information disclosure.
In 2021, the company fulfilled the obligation of information disclosure in strict accordance with the information disclosure management system, strengthened the confidentiality of insider information, and there were no matters that should be disclosed but not disclosed, nor major information disclosure. It maintained the principle of "openness, impartiality and fairness" of information disclosure and protected the interests of investors. Since the establishment of the company's internal information disclosure system, the company's internal risk has been fully and effectively protected and controlled.
The internal control of the above businesses and matters included in the evaluation scope covers the main aspects of the company's current operation and management, and there is no major omission.
5. Internal audit
The company has set up an audit department, which is composed of full-time auditors. Report to the audit committee and the manager of the audit department. The audit department shall independently carry out internal audit in accordance with the provisions of relevant laws, regulations and rules, supervise the operation of the internal control system of the auditee, inspect the accounting accounts and related assets of the auditee, supervise the implementation of budget and final accounts and financial revenue and expenditure of the auditee, and evaluate the benefits of major economic activities.
6. Human resources policy and Practice
According to the development strategy, combined with the human resources situation and future demand forecast, the company has established the human resources development objectives and optimized the overall layout of human resources. Through a series of human resources policies and systems, the recruitment, employment, assessment, salary, reward and punishment, promotion, etc. of human resources are reviewed
