Securities code: Changchun High And New Technology Industries (Group) Inc(000661) securities abbreviation: Changchun High And New Technology Industries (Group) Inc(000661) Announcement No.: 2022014 Changchun High And New Technology Industries (Group) Inc(000661) technology industry (Group) Co., Ltd. 2021 annual internal control self-evaluation report
Changchun High And New Technology Industries (Group) Inc(000661) technology industry (Group) Co., Ltd. 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 company’s (hereinafter referred to as the company’s) 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 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
(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 main units included in the evaluation scope include: the company headquarters, Changchun jinshai Pharmaceutical Co., Ltd. Changchun Bcht Biotechnology Co(688276) , Jilin Huakang Pharmaceutical Co., Ltd. Changchun High And New Technology Industries (Group) Inc(000661) Real Estate Development Co., Ltd. The total assets of the units included in the evaluation scope account for 98.89% of the total assets in the company’s consolidated financial statements, and the total operating revenue accounts for 99.66% of the total operating revenue in the company’s consolidated financial statements; The main businesses and matters included in the evaluation scope include: internal environment, risk assessment, control activities, information and communication, internal supervision, financing business, foreign investment management, enterprise M & a management, interest rate and exchange rate risk management, monetary fund management, acceptance bill management, accounts receivable management, material procurement and supply, inventory management, fixed assets management, intangible assets management Research and development management, engineering project management, guarantee, financial report, comprehensive budget management, contract management, continuous (recurring) related party transactions, non continuous (non recurring) related party transactions, tax management, information resource management, human resource management, information system management, application system it general control, information disclosure, internal audit management, etc; The high-risk areas of focus mainly include: research and development of new drugs, industry risk, financial product management risk and material procurement management risk.
The major risks and omissions of the company’s business and management areas are included in the above-mentioned business scope.
Risks faced by key risk areas and Countermeasures:
1. Research and development of new drugs: the company’s investment projects are mainly new drug projects. New drug research and development has the characteristics of long cycle, large investment and high risk. Lack of decision-making analysis of new drug R & D projects, changes in national policies, international political changes and many other factors may lead to project R & D failure or affect the smooth implementation of project investment. With the increasing internationalization of the company’s investment in new drug projects, in addition to Chinese investment, foreign investment will also increase. How to standardize investment behavior, avoid legal risks and implement effective investment management need to be prepared in advance.
Countermeasures: first of all, everything serves the company’s established strategy and long-term planning. The project layout revolves around the strategic planning, focuses on the established direction, highlights the key points, starts from the market demand and the long-term development direction of the industry, and resolutely avoids falling into the misunderstanding of innovation for the sake of innovation and only talking about science rather than market. Secondly, make scientific decisions, fully understand the laws and regulations of the location of international projects, fully investigate the situation of intellectual property rights before project investment, strictly implement the investment process and avoid legal risks. Improve the qualification review and supervision of cro and other external cooperation institutions to ensure the compliance and high-quality promotion of clinical trials. Conduct all-round in-depth research on the project and issue a feasibility study report, and then conduct in-depth demonstration by the technical committee composed of industry experts. Finally, the board of directors decides whether to establish the project. Thirdly, the whole process control of the project, improve the post investment management, accelerate the progress of key projects, delay the investment of projects with unknown prospects, cut off backward or non competitive projects, and concentrate resources on the top priority projects in combination with the development trend of science and technology and market and the changes of national new drug approval and registration policies. Finally, in terms of the company’s accounting policy, the development expenditure with high risk is included in the current profit and loss, Accounting policies for development expenditure formulated by the company: “The expenditure incurred in the development stage shall be included in the current profit and loss or development expenditure according to its risk degree. According to the research and development progress, an expert evaluation meeting shall be held before financial accounting treatment to judge the risk degree. The project expenditure with risk greater than 30% shall be included in the current profit and loss, and the project expenditure with risk less than 30% shall be included in the development expenditure. All projects that have been included in the development expenditure shall be included in each development stage After the end of the period, experts are invited to re evaluate and confirm the degree of risk. The project expenditure with risk greater than 30% shall be adjusted and included in the current profit and loss, and the project expenditure with risk less than 30% shall continue to be included in the development expenditure “.
2. Industry risks: in 2021, the China Meheco Group Co.Ltd(600056) industry was in the midst of great changes. With the in-depth promotion of medical reform, the adjustment of medical insurance catalogue, the normalization of volume procurement and the superposition of the impact of the epidemic, the China Meheco Group Co.Ltd(600056) industry underwent drastic adjustment, which brought great uncertainty to the development of pharmaceutical enterprises.
Countermeasures: in the face of great changes in the industry, the company responded calmly, adhered to the development goal, strengthened independent research and development of projects, strengthened the strategic support of scientific and technological innovation, continued to improve the development quality, and responded to the industrial changes brought by centralized procurement by strengthening product research and development, project cooperation and capacity reserve, so as to ensure the smooth development of production and operation activities, The company has achieved steady growth in the performance of the company’s leading pharmaceutical industry in 2021.
3. Management of financial products: in order to improve the efficiency of the company’s use of funds, increase the return of shareholders and make rational use of idle self owned funds, on the premise of ensuring the company’s daily operation and project construction fund demand, some temporarily idle self owned funds of the company are purchased for financial products, although the invested financial products belong to low-risk investment varieties, However, the financial market is greatly affected by the macro economy. It is not ruled out that an investment is affected by market fluctuations. In the face of liquidity risks, unexpected actual returns and other risks, it is extremely important to strengthen risk control.
Countermeasures:
(1) Within the validity period and limit, the management of the company shall exercise decision-making status, cash flow status, interest rate change and relevant resolutions of the board of directors, mainly select principal guaranteed or low-income and low-risk financial products, judge the investment scale and expected income of financial products, and conduct content audit and risk assessment of financial products.
(2) The Finance Department of the company will analyze and track the progress in time. Once it is found that there are risk factors that may affect the safety of the company’s funds, it will take preservation measures in time to control the investment risk.
(3) The internal audit department of the company is responsible for auditing and supervising the use and custody of the company’s funds for purchasing financial products, comprehensively inspecting all investment projects of financial products every quarter, reasonably predicting the possible gains and losses of various investments according to the principle of prudence, and reporting to the audit committee of the board of directors and the board of directors of the company.
(4) The independent directors and the board of supervisors have the right to inspect the company’s investment in financial products regularly or irregularly, and can hire professional institutions to audit when necessary. (5) According to the relevant regulations of Shenzhen Stock Exchange, the company will disclose the purchase of financial products and relevant profits and losses during the reporting period in the regular report.
4. Material procurement management: the company’s material procurement projects are mainly the main raw materials, auxiliary materials, fuels, power, tools, accessories and equipment used in product production, capital construction and special projects. The potential risk factors of material procurement are the volume of material procurement business, procurement frequency, the range of price changes under the influence of the epidemic, the organizational scale of supply enterprises, the probability of mistakes and abuses, the speed of technical change, the quality and ability of managers, etc. The risk management of material procurement is very important to improve the quality of material procurement, reduce procurement costs, safeguard the legitimate rights and interests of the company, and promote the increase of the value of the company and the realization of production objectives.
Countermeasures:
(1) Timely review: timely review the appropriateness, legitimacy and effectiveness of the material procurement plan according to the changes of the external environment and internal conditions.
(2) Information management: improve the professional knowledge of material procurement management of management personnel, be familiar with relevant laws, regulations, policies and relevant internal regulations of the company, master the internal control principle of material procurement, and understand the current situation of material procurement and the changes of external environment in real time.
(3) System control: business authorization, separation of responsibilities, price information control, quality acceptance control, voucher and record control, material procurement bidding control, internal self owned supervision mechanism, three-level control and regular special inspection.
(II) construction of internal control
1. Organizational structure:
In accordance with the principle of simplification and efficiency, the company reasonably sets up its internal organization by comprehensively considering the nature of the enterprise, development strategy, cultural concept, management requirements and other factors, defines the responsibilities and authorities of each organization, avoids cross functions, lack or over concentration of rights and responsibilities, and forms a working mechanism of performing their own duties, assuming their own responsibilities, mutual restriction and mutual coordination. The company establishes a party committee, Implement the leadership system of “two-way entry and cross appointment”, ensure to supervise the implementation of the principles and policies of the party and the state in the company, participate in the decision-making of major issues of the enterprise, and support the board of shareholders, the board of directors, the board of supervisors and the management to exercise their functions and powers according to law.
At present, the organizational structure of internal control is shown in the figure:
2. Internal audit
The company has formulated rules and regulations for internal audit work such as detailed rules for the work of the audit committee of the board of directors, internal audit management system and internal control system. The board of directors has an audit committee, and the Audit Department of the company independently carries out the internal audit and supervision of the company under the direct leadership of the audit committee. The audit department shall appoint full-time personnel to audit and verify the financial revenue and expenditure, production and operation activities and engineering construction of all internal departments and subsidiaries of the company, make reasonable evaluation on the authenticity, legitimacy and rationality of economic benefits, and conduct comprehensive internal control audit and special internal control audit on the internal management system of the company, Review, supervise and evaluate the effectiveness of internal control design and operation and the appropriateness of risk management.
3. Human resources policy
Focusing on the strategic goal of building a highly competitive pharmaceutical enterprise, the company implements the strategy of strengthening the enterprise with talents, provides intellectual support and drives sustainable development. The overall plan of human resources is formulated from the aspects of comprehensively improving the overall quality of the talent team, improving the growth channels of all kinds of talents, innovating the working mechanism of selecting, educating, becoming and gathering talents, strengthening the reform and structural optimization of talent management system, establishing a dynamic talent competition mechanism, and strengthening the supervision and restraint of talent team. The company has formulated a systematic human resource management system. It has made detailed provisions on personnel employment, employee training, dismissal and resignation, salary, welfare guarantee, performance appraisal, promotion, rewards and punishments, and established a perfect performance appraisal system. The company takes professional ethics and professional competence as important standards for the selection and employment of employees, earnestly strengthens employee training and continuing education, and continuously improves the quality of employees.
4. Corporate culture
The company strives to realize the organic unity of the state, shareholders, enterprises and employees, so as to reflect the coordination of the interests of the four, the coordination of current and long-term development, and the coordination of enterprises with society and environment; The company is positioned to focus on pharmaceutical and medical services, focus on the production and sales of biopharmaceuticals and Chinese patent medicines, moderately diversify, strive to improve the level of operation and management and create excellent performance; Building an enterprise with credit and governing the enterprise with system are the foundation for the establishment and development of the enterprise, opening and cooperation are the only way for sustainable development, and “innovation, focus, inclusiveness, sharing and Transcendence” is the main purpose of the enterprise. The company takes the construction of internal control system as an opportunity to promote the formation of risk management concept. The employees have a strong sense of responsibility in the construction of the company’s social style, and play a positive role in the construction of the company’s culture.
5. Social responsibility
The company always pays attention to the coordinated and sustainable development of the enterprise, society and environment, and takes the performance of social responsibility as an important measure to improve the core competitiveness, so as to promote the comprehensive, coordinated and sustainable development of the enterprise. The company always insists on providing qualified products and services to the society and the public as the company’s greatest responsibility. Adhering to the concept of sustainable development, the company actively promoted its affiliated enterprises to fulfill their corporate social responsibility, and promoted the typical practices of its affiliated enterprises in all aspects of social responsibility management, which effectively promoted the sustainable development of the enterprise.
(III) internal control evaluation basis and internal control defect identification standard
The company organizes and carries out internal control evaluation according to the enterprise internal control standard 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
The quantitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
The benchmark used to identify internal control deficiencies related to financial reporting involves the application of professional judgment. For profit-making entities, the pre tax profit of continuing operations (the audited average of recent three years) is taken as the benchmark; If a going concern
