catalogue
Page I. internal control assurance report 1-3
2、 Internal control self evaluation report 4-17
Internal control assurance report
Zhong Hui Hui Hui Jian [2022] No. 0530 Inner Mongolia Dazhong Mining Co.Ltd(001203) all shareholders:
We have accepted the entrustment to review the attached self-evaluation report on Inner Mongolia Dazhong Mining Co.Ltd(001203) (hereinafter referred to as Inner Mongolia Dazhong Mining Co.Ltd(001203) company) prepared by the management of Inner Mongolia Dazhong Mining Co.Ltd(001203) company as of December 31, 2021, and verified the effectiveness of internal control related to financial statements.
1、 Description of significant inherent limitations
Internal control has inherent limitations, and there is the possibility of misstatement and undetected due to error or fraud. In addition, due to changes in circumstances that may lead to inappropriate internal control, or reduce the degree of 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、 Restrictions on the users and purposes of the report
This assurance report is only used for the disclosure of the annual report of Inner Mongolia Dazhong Mining Co.Ltd(001203) company and shall not be used for any other purpose. We agree that this assurance report, as a necessary document for the disclosure of Inner Mongolia Dazhong Mining Co.Ltd(001203) company's annual report, shall be submitted together with other materials and disclosed publicly.
3、 Responsibilities of management
The management of Inner Mongolia Dazhong Mining Co.Ltd(001203) company is responsible for establishing and improving internal control and maintaining its effectiveness. Meanwhile, in accordance with the basic norms for internal control of enterprises (CK [2008] No. 7) and relevant regulations, the management of Inner Mongolia Dazhong Mining Co.Ltd(001203) company shall recognize the effectiveness of internal control related to financial report on December 31, 2021 and be responsible for the above recognition.
4、 Responsibilities of Certified Public Accountants
Our responsibility is to express assurance opinions on the effectiveness of internal control based on the implementation of assurance work.
5、 Job overview
We have carried out the assurance business in accordance with the provisions of other certification business standards for Chinese certified public accountants No. 3101 - assurance business other than audit or review of historical financial information. The above provisions require us to plan and implement the assurance work to obtain reasonable assurance on whether the information of the assurance object is free from material misstatement. In the assurance process, we have implemented other procedures including understanding, testing and evaluating the rationality of the design and effectiveness of the implementation of the internal control system, as well as other procedures that we consider necessary. We believe that our assurance work provides a reasonable basis for expressing opinions.
6、 Assurance conclusion
We believe that Inner Mongolia Dazhong Mining Co.Ltd(001203) company has maintained effective internal control related to financial statements in all major aspects on December 31, 2021 in accordance with the basic norms of enterprise internal control and relevant regulations.
This conclusion is formed under the inherent limitations pointed out in the assurance report.
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Zhonghui Certified Public Accountants (special general partnership) Chinese certified public accountant: Lin Pengfei
Hangzhou, China Certified Public Accountant: Tang Gu
Report date: March 3, 2022
Internal control evaluation report in 2021
Inner Mongolia Dazhong Mining Co.Ltd(001203) all shareholders:
In accordance with the basic norms of enterprise internal control jointly issued by the Ministry of finance, China Securities Regulatory Commission and other departments and relevant provisions of other laws and regulations, combined with Inner Mongolia Dazhong Mining Co.Ltd(001203) (hereinafter referred to as the company or the company) internal control system and evaluation methods, on the basis of daily and special supervision of internal control, We have conducted a comprehensive inspection on the establishment, improvement and implementation of the company's internal control, identified the defects existing in the design and operation of the internal control, fully communicated with the external audit institutions and widely consulted the opinions of the external auditors. On this basis, we have evaluated the rationality and effectiveness of the establishment of the company's internal control The integrity and effectiveness of implementation are comprehensively evaluated. The company's self-evaluation of internal control as of December 31, 2021 (benchmark date of internal control evaluation report) is reported as follows.
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 company's 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, the authenticity and integrity of financial reports and relevant information, improve the efficiency and effect of operation, and promote the realization of the company's 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、 Evaluation conclusion of internal control effectiveness
According to the identification of major defects in the company's internal control over financial reporting, the company has 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 has no major defects in the company's internal control over non-financial reports on the benchmark date of the internal control evaluation report. From the benchmark date of the internal control evaluation report to the date when the internal control evaluation report is not issued.
3、 Internal control evaluation
（1） 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. 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.
Details of the company's businesses and matters included in the evaluation scope are as follows:
1. Internal environment
(1) Governance structure
In accordance with relevant national laws and regulations and the articles of association, the company has established a standardized corporate governance structure and rules of procedure, defined the responsibilities and authorities in decision-making, implementation and supervision, and formed a scientific and effective division of responsibilities and check and balance mechanism.
1) The company has formulated the rules of procedure of the general meeting of shareholders, which clearly stipulates the nature, functions and powers of the general meeting of shareholders and the working procedures such as convening and notification, proposal, voting and resolution of the general meeting of shareholders. The formulation and effective implementation of the rules ensure that the general meeting of shareholders exercises the decision-making power on major matters according to law, which is conducive to protecting the legitimate rights and interests of shareholders.
The general meeting of shareholders of the company operates in strict accordance with the company law, the articles of association, the rules of procedure of the general meeting of shareholders and relevant laws and regulations. Shareholders attend the meeting in accordance with legal requirements and put forward proposals and suggestions related to the terms of reference of the general meeting of shareholders. The general meeting of shareholders revised the articles of association, the work reports of the board of directors and the board of supervisors of each year during the reporting period Make resolutions on annual financial final accounts and budgets, appointment of audit institutions, profit distribution, general election of directors and supervisors, etc.
2) The board of directors of the company consists of 5 directors, including 2 independent directors. There are four special committees including strategy committee, audit committee, salary and assessment committee and Nomination Committee. The board of directors of the company operates in accordance with the company law, the articles of association, the rules of procedure of the board of directors and relevant laws and regulations. The directors attend the meeting in accordance with legal requirements and put forward proposals and suggestions related to the scope of responsibilities of the board of directors. The board of directors makes resolutions on the selection and employment of senior managers, the work report of the general manager, related party transactions and other matters of the company. The securities center is responsible for the daily work of the board of directors.
3) The board of supervisors of the company is composed of three supervisors, one of whom is the employee representative. The company has formulated the rules of procedure of the board of supervisors, which clearly stipulates the responsibilities of supervisors, the functions and powers of the board of supervisors, the convening and notification of the board of supervisors, resolutions, etc. The formulation and effective implementation of the rules will help give full play to the supervisory role of the board of supervisors and protect the interests of shareholders, the company and the legitimate interests of employees from infringement.
4) The company has formulated the general manager's working rules, which stipulates the responsibilities of the general manager, the general manager's office meeting and production scheduling meeting, the general manager's reporting system, supervision system and other contents. The formulation and effective implementation of these systems ensure the effective implementation of various decisions of the board of directors, and improve the operation and management level and risk prevention ability of the company.
(2) Internal organizational structure
The internal institutions set up by the company include: development planning center, human resources training center, operation management center, control center, financial management center, material procurement center, sales center, securities legal center, party masses administration center, audit department, quality measurement department, safety and environmental protection department, production technology department, etc. By reasonably dividing the responsibilities of each department and post, and implementing the principle of separation of incompatible positions, a mechanism of clear division of labor, mutual cooperation and mutual checks and balances is formed between each department, which ensures the orderly and healthy operation of the company's production and operation activities and the realization of control objectives.
(3) Establishment of internal audit institutions
The audit committee under the board of directors of the company is responsible for the communication, supervision and verification of internal and external audits of the company in accordance with the rules of procedure of the audit committee and other provisions. The audit committee consists of three directors and two independent directors, one of whom is an accounting professional and serves as the convener of the Committee. The audit committee has an audit department, a manager of the internal audit department and 10 auditors, who have the professional ability to carry out audit work independently. The internal audit department shall supervise and inspect the effectiveness of internal control in combination with internal audit supervision. The internal audit department shall report the internal control defects found in the supervision and inspection in accordance with the internal audit procedures of the enterprise; Have the right to report directly to the board of directors, its audit committee and the board of supervisors on the major defects of internal control found in the supervision and inspection.
(4) Human resources policy
The company has formulated human resources policies conducive to the sustainable development of the enterprise, including: employment, training, dismissal and resignation of employees; Salary, assessment, promotion, reward and punishment of employees;
At the same time, the company attaches great importance to the quality of employees and takes professional ethics and professional competence as important standards for selecting and employing employees. At present, the company has 3149 employees, including 2099 production personnel, 20 sales personnel, 209 technical personnel, 31 financial personnel and 791 administrative personnel; Among them, there are 16 masters, 272 undergraduates, 402 junior college students and 2459 senior high school students and below. The company also carries out various forms of follow-up training and education for different posts according to the needs of actual work, so that employees can be competent for their jobs.
(5) Corporate culture
The company adheres to the mining concept of resource conservation and recycling, builds a national green mine, and improves the mining and beneficiation efficiency and reduces the cost with continuous technical improvement; Enrich the company's product line under the guidance of comprehensive utilization of mines; Take the construction of automation and informatization as the starting point to improve the level of production control; Implement the measures of "safety first, prevention first and comprehensive treatment", strengthen environmental protection, strictly carry out safe production, ensure product quality, and strive to make the company a leading excellent enterprise in the industry.
2. Risk assessment
The company has formulated reasonable control objectives and established an effective risk assessment mechanism to identify and respond to internal and external risks related to the realization of control objectives and determine the corresponding risk tolerance.
3. Control activities
(1) Incompatible job separation control
The company has comprehensively and systematically analyzed and sorted out the incompatible positions involved in the business process, implemented corresponding separation measures, and formed a working mechanism of performing their respective duties, assuming their respective responsibilities and restricting each other. Incompatible positions mainly include: authorization and approval and business execution, business execution and audit supervision, property custody and accounting records, business handling and business audit, etc.
(2) Authorization approval control
The company has divided the authorization approval control into routine authorization and special authorization, and defined the scope of authority, approval procedures and corresponding responsibilities for each post to handle business and matters. For routine authorization, authority guidelines are prepared; For special authorization, clearly regulate its scope, authority, procedures and responsibilities, and strictly control special authorization.
(3) Accounting system control
1) The company has confirmed, measured and prepared financial statements in strict accordance with the accounting law and accounting standards for business enterprises, and clarified the processing procedures of accounting vouchers, accounting books and financial reports to ensure the authenticity and integrity of accounting materials.
2) The basic work of accounting is perfect, the setting of accounting institutions is complete, the accounting practitioners are allocated in accordance with the requirements of the state on accounting qualification, and the institutions and personnel meet the relevant independence requirements.
(4) Property protection control
The company has established a daily property management system and a regular inventory system, and taken measures such as property records, physical storage, regular inventory, account verification, restricted access and disposal to ensure property safety.
(5) Budget control
The company has implemented a comprehensive budget management system, defined the responsibilities and authorities of each responsible unit in budget management, standardized the procedures for budget preparation, approval, issuance and implementation, and strengthened budget constraints.
(6) Operation analysis control
The company has established an operation analysis system. The management timely and comprehensively uses the information of production, purchase and sale, investment, financing and finance, and regularly carries out operation analysis through factor analysis, comparative analysis, trend analysis and other methods to find out the existing problems, find out the causes and improve them in time.
(7) Performance appraisal control
The company has established and implemented a performance evaluation system, set up an evaluation index system, and conduct regular and objective evaluation on the performance of all responsible units and all employees within the enterprise. The evaluation results will be used as the basis for determining employees' salary and job promotion, evaluation, demotion, job transfer, dismissal, etc.
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