Zhejiang Taitan Co.Ltd(003036) internal control assurance report
As of December 31, 2021
Table of contents page I. internal control assurance report 1-2 II. Self evaluation report of the company’s internal control 1-4
Internal control assurance report
Xin Hui Shi Bao Zi [2022] No. zf10105 Zhejiang Taitan Co.Ltd(003036) all shareholders:
We have accepted the entrustment to verify the board of directors of Zhejiang Taitan Co.Ltd(003036) (hereinafter referred to as ” Zhejiang Taitan Co.Ltd(003036) “) on the effectiveness of internal control over Zhejiang Taitan Co.Ltd(003036) financial reporting on December 31, 2021.
1、 Responsibilities of the board of directors for internal control
Zhejiang Taitan Co.Ltd(003036) the responsibility of the board of directors is to establish, improve and effectively implement internal control in accordance with the relevant provisions of the basic norms of enterprise internal control, evaluate its effectiveness, and truthfully disclose the internal control evaluation report.
2、 Responsibilities of Certified Public Accountants
Our responsibility is to issue assurance conclusions on the effectiveness of internal control over financial reporting based on the implementation of assurance work.
3、 Overview of work
We have carried out the assurance business in accordance with the provisions of other assurance business standards for Chinese certified public accountants No. 3101 – assurance business other than audit or review of historical financial information. The standard requires us to abide by the code of professional ethics of Chinese certified public accountants, plan and implement the assurance work, so as to obtain reasonable assurance on whether Zhejiang Taitan Co.Ltd(003036) has maintained effective internal control over financial reporting in all material aspects in accordance with the relevant provisions of the basic norms of enterprise internal control on December 31, 2021. In the process of performing the assurance work, we have implemented other procedures including understanding, testing and evaluating the effectiveness of internal control and other procedures that we deem necessary. We believe that our assurance work provides a reasonable basis for issuing assurance conclusions.
4、 Description of significant inherent limitations
Internal control has inherent limitations, and there is the possibility of undetected misstatement due to error or fraud. In addition, due to the change of circumstances, the internal control may become inappropriate, or the degree of compliance with control policies and procedures may be reduced. According to the internal control evaluation results, it is speculated that the effectiveness of internal control in the future has a certain risk.
5、 Assurance conclusion
We believe that Zhejiang Taitan Co.Ltd(003036) has maintained effective internal control over financial reporting in all major aspects in accordance with the relevant provisions of the basic norms of enterprise internal control on December 31, 2021.
Chinese certified public accountant of Lixin certified public accountants: Guo Xianming (special general partnership) (project partner)
Chinese certified public accountant: Liu Zhiyong Chinese certified public accountant: Cao Libin, Shanghai, China March 15, 2002
Zhejiang Taitan Co.Ltd(003036) 2021 annual internal control self-evaluation report
Zhejiang Taitan Co.Ltd(003036)
Self evaluation report on internal control in 2021
Zhejiang Taitan Co.Ltd(003036) all shareholders:
In accordance with the provisions of the basic norms of enterprise internal control and its supporting guidelines and other internal control regulatory requirements (hereinafter referred to as the “enterprise internal control normative system”), combined with Zhejiang Taitan Co.Ltd(003036) (hereinafter referred to as the “company”) internal control system and evaluation methods, on the basis of daily and special supervision of internal control, We evaluated the effectiveness of the company’s internal control as of December 31, 2021 (benchmark date of 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 results, 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.
Zhejiang Taitan Co.Ltd(003036) 2021 annual internal control self-evaluation report 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. The main units included in the scope of evaluation include:
S / N main unit remarks
1 Zhejiang Taitan Co.Ltd(003036) parent company
2. Wholly owned subsidiary of Xinchang Shanghai Titan Scientific Co.Ltd(688133) Co., Ltd
3. Wholly owned subsidiary of Xinchang aidas dyeing and finishing equipment Co., Ltd
4. Holding subsidiary of Zhejiang Rongjun Technology Co., Ltd
5. Holding subsidiary of Aksu PuMei Textile Technology 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 operations and matters included in the scope of evaluation include:
Serial number business and event category business and event
A. Governance structure
B. Organizational structure
1. Internal environment C. internal audit
D. Human resources
E. Corporate culture
A. Financial activities
B. Procurement business
C. Production management
D. Asset management
2. Control activities E. sales business
F. Foreign investment
G. Related party transactions
H. Guarantee business
1. Financial Report
A. Contract management
3. Control means B. internal information transmission
C. Information system
The high-risk areas of focus mainly include capital activities, procurement business, asset management, sales business, guarantee business, etc.
The above units, businesses and matters included in the evaluation scope and high-risk areas cover all major aspects of the company’s operation and management, and there are no major omissions.
Zhejiang Taitan Co.Ltd(003036) 2021 annual internal control self-evaluation report (II) basis of internal control self-evaluation and identification standard of internal control defects
In accordance with the enterprise internal control standard system and relevant laws such as the Listing Rules of Shenzhen Stock Exchange, the basic norms of enterprise internal control, the self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 1 – standardized operation of listed companies on the main board Organize and carry out internal control evaluation according to laws and regulations, rules and regulations and the company’s internal control system.
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. The identification standards of internal control defects determined by the company are as follows:
1. Identification criteria for defects in internal control over financial reporting:
(1) The quantitative criteria for internal control deficiencies in financial reporting are as follows:
Major defect important defect general defect
A. Amount of misstatement in financial report ≥ 1.5% of total assets A. 1% of total assets 1% of total assets in financial report 1.5% of total assets in financial report; Or the reported amount ≥ 1% of the total assets; or; Amount, or;
B. 3% of the total amount of profit in financial report ≥ 5% of the total amount of profit in financial report
(2) The qualitative criteria for the defects of internal control over financial reporting are as follows:
Major defect important defect general defect
A. Invalid control environment; A. The company’s non management has serious fraud, except for major defects and important defects. B. the behavior of the company’s directors, supervisors and senior managers; He has control defects
Fraud and causing significant losses and non profits to the enterprise B. the company did not choose in accordance with generally accepted accounting standards
Profit impact; Compared with the application of accounting policies, it is not as serious as
C. The certified public accountant finds major defects in the current financial report; There are major misstatements, and the accounting policies applied by the internal control in the operation of C. company do not comply with the company’s requirements
The false alarm is not found in the process; Company accounting system
