Working system of budget and Audit Committee of the board of directors
(revised 2022)
Chapter I General Provisions
Article 1 in order to improve the level of corporate governance and standardize the operation of the budget and Audit Committee of the board of directors (hereinafter referred to as the "budget and audit committee"), In accordance with the provisions of the company law of the people's Republic of China, the securities law of the people's Republic of China, the governance standards of listed companies, the basic norms of enterprise internal control, the stock listing rules of Shanghai Stock Exchange, the guidelines for self discipline supervision of listed companies of Shanghai Stock exchange No. 1 - standardized operation and other laws, regulations, normative documents and the articles of association, Formulate this working system.
Article 2 the budget and audit committee is a special committee under the board of directors. It is responsible to the board of directors and performs its duties in accordance with the articles of association and the authorization of the board of directors. Its proposal shall be submitted to the board of directors for deliberation and decision.
Article 3 the members of the budget and audit committee shall ensure that they have enough time and energy to perform the duties of the committee, be diligent and responsible, effectively supervise and evaluate the internal and external audit of the company, promote the company to establish effective internal control and provide true, accurate and complete financial reports.
Article 4 the financial department and Audit Department of the company are the counterpart offices of the budget and audit committee, responsible for them and report their work to them.
The Secretary Office of the board of directors of the company is responsible for the daily work liaison, meeting organization, meeting minutes and file management of the budget and audit committee.
The audit department and the management committee shall cooperate with each other when performing their duties.
Chapter II personnel composition
Article 5 the members of the budget and audit committee shall be composed of three or more board members appointed by the board of directors.
Article 6 in principle, the members of the budget and audit committee shall be independent of the daily operation and management of the company. Independent directors of the budget and audit committee shall account for more than half of the total number of members of the budget and audit committee.
Article 7 all members of the budget and audit committee shall have professional knowledge and experience in performing the duties of the budget and audit committee.
Article 8 the budget and audit committee shall have a convener, who shall be an independent director, who shall be responsible for presiding over the work of the Committee. The convener of the budget and audit committee shall be an accounting professional.
Article 9 The term of office of the budget and audit committee is the same as that of the board of directors. Upon expiration of the term of office, members can be re elected. During this period, if a member no longer holds the position of director of the company, he will automatically lose the qualification of member, and a new member will be elected by the board of directors to make up the number.
Article 10 the company shall organize members of the budget and audit committee to participate in relevant training to enable them to timely obtain the professional knowledge of law, accounting and regulatory norms of listed companies required for performing their duties.
Article 11 the board of directors of the company shall regularly evaluate the independence and performance of the members of the budget and audit committee, and may replace the members who are not suitable to continue to serve when necessary.
Chapter III responsibilities of the Committee
Article 12 the responsibilities of the budget and Audit Committee include the following aspects:
(I) review the company's budget;
(II) supervise and evaluate the work of external audit institutions;
(III) supervise and evaluate the internal audit work;
(IV) review the company's financial report and express opinions on it;
(V) supervise and evaluate the company's internal control;
(VI) coordinate the communication between the management, internal audit department and relevant departments and external audit institutions;
(VII) issue opinions on major connected transactions that need to be submitted to the general meeting of shareholders for deliberation; (VIII) other matters authorized by the board of directors of the company and other matters involved in laws and regulations and relevant provisions of Shanghai Stock Exchange.
Article 13 the responsibilities of the budget and audit committee to supervise and evaluate the work of external audit institutions must at least include the following aspects:
(I) evaluate the independence and professionalism of external audit institutions, especially the impact of non audit services provided by external audit institutions on their independence;
(II) propose to the board of directors to hire or replace the external audit institution;
(III) review the audit fees and employment terms of the external audit institution;
(IV) discuss and communicate with external audit institutions on audit scope, audit plan, audit methods and major matters found in the audit;
(V) 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 care, and prudently express professional opinions. The budget and audit committee shall not be unduly influenced by the company's major shareholders, actual controllers, directors, supervisors and senior managers when performing its duties in items (II) and (III) of the preceding paragraph.
The budget and audit committee shall hold a separate communication meeting with the external audit organization 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 14 the responsibilities of the budget and audit committee in supervising and evaluating internal audit shall at least include the following aspects:
(I) guide and supervise the establishment and implementation of internal audit system;
(II) review the company's annual internal audit work plan;
(III) supervise and urge the implementation of the company's internal audit plan;
(IV) guide the effective operation of the internal audit department. The internal audit department of the company shall report its work to the budget and audit committee. Various audit reports submitted by the internal audit department to the management, the rectification plan and rectification of audit problems shall be submitted to the budget and audit committee at the same time;
(V) report to the board of directors on the progress and quality of internal audit and major problems found;
(VI) coordinate the relationship between the internal audit department and external audit units such as accounting firms and national audit institutions.
Article 15 the responsibilities of the budget and audit committee to review and express opinions on the company's financial reports shall at least include the following aspects:
(I) review the company's financial and accounting reports and put forward opinions on the authenticity, completeness and accuracy of the financial and accounting reports;
(II) review the company's financial budget;
(III) focus on major accounting and audit issues in the company's financial and accounting reports, including major accounting error adjustment, major accounting policy and estimation changes, matters involving important accounting judgments, matters leading to non-standard unqualified audit reports, etc;
(IV) pay special attention to the possibility of fraud, fraud and material misstatement related to financial and accounting reports;
(V) supervise the rectification of problems in financial and accounting reports.
Article 16 the responsibilities of the budget and audit committee to supervise and evaluate the company's internal control shall at least include the following aspects:
(I) evaluate the appropriateness of the company's internal control system design;
(II) review the internal control self-evaluation report;
(III) review the internal control audit report issued by the external audit institution, and communicate with the external audit institution the problems found and the improvement methods;
(IV) evaluate the results of internal control evaluation and audit, and urge the rectification of internal control defects.
Article 17 the responsibilities of the budget and audit committee to coordinate the communication between the management, internal audit department and relevant departments and external audit institutions include:
(I) coordinate the communication between the management and external audit institutions on major audit issues; (II) coordinate the communication between internal audit department and external audit institutions and the cooperation of external audit.
Article 18 the budget and audit committee shall report to the board of directors on the measures or improvements it deems necessary and put forward suggestions.
Article 19 If the budget and 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 20 when the company hires or replaces an external audit institution, the budget and audit committee shall form deliberation opinions and put forward suggestions to the board of directors before the board of directors can consider relevant proposals.
Chapter IV meetings of the Committee
Article 21 the meetings of the budget and audit committee are divided into regular meetings and interim meetings. The meeting shall be notified to all members in writing, fax, e-mail or telephone before the meeting is held.
The meeting was convened and presided over by the convener of the budget and audit committee. If the convener of the budget and audit committee cannot or refuses to perform his duties, he shall appoint an independent director to perform his duties on his behalf.
Article 22 the budget and audit committee shall hold at least four regular meetings every year.
The budget and audit committee may hold interim meetings as required. When two or more members of the budget and audit committee propose, or the convener of the budget and Audit Committee deems it necessary, an interim meeting may be held.
Article 23 the meeting of the budget and audit committee shall be held only when more than two-thirds of the members are present.
Article 24 the meeting of the budget and audit committee may be held by on-site meeting or communication, or by a combination of on-site meeting and communication.
The voting method of the meeting is written voting.
Article 25 the deliberation opinions put forward by the budget and audit committee to the board of directors must be adopted by more than half of all members. If effective deliberation opinions cannot be formed due to the avoidance of members of the budget and audit committee, relevant matters shall be directly deliberated by the board of directors.
Article 26 members of the budget and audit committee shall attend the meeting in person and express clear opinions on the matters under consideration. If a member is unable to attend the meeting in person for some reason, he may submit a power of attorney signed by the member and entrust other members to attend and express their opinions on his behalf. The power of attorney must specify the scope and duration of authorization. Each member shall be entrusted by at most one member. If an independent director is unable to attend the meeting in person for some reason, he shall entrust other independent director members to attend the meeting on his behalf.
Article 27 when the budget and Audit Committee deems it necessary, it may invite representatives of external audit institutions, company supervisors, internal auditors, financial personnel, legal advisers and other relevant personnel to attend the meeting of the Committee and provide necessary information.
Article 28 minutes of the meeting of the budget and audit committee shall be made. The minutes of the meeting shall be signed by the members and other members present. The minutes of the meeting shall be kept by the Secretary Office of the board of directors of the company. The storage period shall not be less than 10 years.
Article 29 the deliberation opinions adopted at the meeting of the budget and audit committee shall be submitted to the board of directors of the company in writing.
Article 30 all personnel attending the meeting shall be obliged to keep confidential the items discussed at the meeting and shall not disclose relevant information without authorization.
Article 31 If any member of the budget and audit committee has an interest in the matters discussed at the meeting, he shall withdraw.
Article 32 the convening procedures, voting methods and proposals adopted at the meeting of the budget and audit committee shall comply with the provisions of relevant laws and regulations, the articles of association and this system.
Chapter V Information Disclosure
Article 33 the company shall disclose the personnel of the budget and audit committee, including the composition, professional background, working experience within five years and the changes of the personnel of the budget and audit committee.
Article 34 while disclosing the annual report, the company shall disclose the annual performance of the budget and Audit Committee on the website of Shanghai Stock Exchange, mainly including the performance of its duties and the convening of the meeting.
Article 35 If the major problems found by the budget and Audit Committee during the performance of its duties touch the information disclosure standards specified in the stock listing rules of Shanghai Stock Exchange, the company shall disclose such matters and their rectification in a timely manner.
Article 36 the budget and audit committee shall put forward deliberation opinions to the board of directors of the company on matters within its scope of responsibility. If the board of directors fails to adopt them, the company shall disclose the matter and fully explain the reasons.
Article 37 the company shall disclose the budget and special opinions issued by the Audit Committee on major matters of the company in accordance with the provisions of laws, administrative regulations, departmental rules, stock listing rules of Shanghai Stock Exchange and relevant normative documents.
Chapter VI supplementary provisions
Article 38 matters not covered in this system shall be implemented in accordance with relevant laws, regulations, normative documents, articles of association and other relevant systems.
Article 39 in case of any change in relevant laws, regulations, normative documents, articles of association and rules of procedure of the board of directors, resulting in the conflict between the system and the provisions of the above documents, the board of directors shall modify the system in time.
Article 40 the system shall be revised and interpreted by the board of directors of the company.
Article 41 the system shall come into force from the date of deliberation and approval by the board of directors, and the original budget and audit committee working system of Sunny Loan Top Co.Ltd(600830) board of directors (revised in 2014) shall be abolished at the same time.
