Company code: Holsin Engineering Consulting Group Co.Ltd(603909) company abbreviation: Holsin Engineering Consulting Group Co.Ltd(603909)
Holsin Engineering Consulting Group Co.Ltd(603909)
Internal control evaluation report in 2021
Holsin Engineering Consulting Group Co.Ltd(603909) 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). I 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.
II Internal control evaluation conclusion
1. Does the company have any major defects in internal control over financial reporting on the benchmark date of internal control evaluation report
□ yes √ no
2. Evaluation conclusion of internal control over financial reporting
√ valid □ invalid
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.
3. Whether major defects in internal control over non-financial reporting are found
□ yes √ no
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.
4. Factors affecting the evaluation conclusion of internal control effectiveness from the base date of internal control evaluation report to the date of issuance of internal control evaluation report
□ applicable √ not applicable
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.
5. Whether the internal control audit opinion is consistent with the company's evaluation conclusion on the effectiveness of internal control over financial reporting
√ yes □ no
6. Whether the disclosure of major defects in internal control of non-financial reports in the internal control audit report is consistent with the disclosure of the company's internal control evaluation report
√ yes □ no
III 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.
1. The main units included in the evaluation scope include Holsin Engineering Consulting Group Co.Ltd(603909) and its subordinate Xiamen Hecheng Engineering Testing Co., Ltd., Xiamen Hecheng Engineering Technology Co., Ltd., Xiamen Hecheng Engineering Design Institute Co., Ltd., Xiamen Hecheng Water Transportation Engineering Consulting Co., Ltd., Dalian Municipal Design and Research Institute Co., Ltd., Xiamen Hezhi New Material Technology Co., Ltd., Fujian Yilu Engineering Co., Ltd., Fujian Kesheng reinforcement material Co., Ltd Tiancheng Huarui Decoration Co., Ltd.
2. Proportion of units included in the scope of evaluation:
Proportion of indicators (%)
The ratio of the total assets of the units included in the evaluation scope to the total assets of the company's consolidated financial statements 100
The total operating income of the units included in the evaluation scope accounts for 100% of the total operating income in the company's consolidated financial statements
3. The main operations and matters included in the scope of evaluation include:
Communication with the company's internal environment and risk assessment; Business level financial report, comprehensive budget, fund management, procurement and payment, contract management, human resources, information system, asset management, research and development, business outsourcing, production and storage, engineering construction business, design business, supervision business, testing business, sales business, etc.
4. High risk areas of focus mainly include:
Strategic risk, capital risk, quality risk, safety risk, market risk, investment risk and technical risk.
5. The above units, businesses and matters included in the evaluation scope and high-risk areas cover the main aspects of the company's operation and management. Is there any major omission
□ yes √ no
6. Is there a statutory exemption
□ yes √ no
7. Other explanatory matters
nothing
（2） Basis of internal control evaluation and identification standard of internal control defects
The company organizes and carries out internal control evaluation according to the enterprise internal control standard system and internal control evaluation manual.
1. Whether the specific identification standard of internal control defects is adjusted with that of previous years
□ yes √ no
The board of directors of the company distinguished the internal control of financial report from the internal control of non-financial report according to the identification requirements for major defects, important defects and general defects of the enterprise internal control standard system, combined with the factors such as the company's size, industry characteristics, risk preference and risk tolerance, and studied and determined the specific identification standards of internal control defects applicable to the company, which are consistent with the previous years.
2. Identification standard of internal control defects in financial reporting
The quantitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Index name major defect quantitative standard important defect quantitative standard general defect quantitative standard
Misstatement of total assets ≥ 3% of total assets ≤ 1% of total assets ≤ misstatement ＜ 1% of total assets ＜ 3% of total assets
Total profit misstatement ≥ 5% of total profit, 3% of total profit ≤ misstatement ＜ profit misstatement ＜ 3% of total profit, 5% of total profit
explain:
nothing
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Qualitative standard of defect nature
1. Directors, supervisors and senior managers commit fraud;
Major defects 2. Major misstatements in the current financial report were not identified by internal control, but found by external audit;
3. The supervision of the audit committee and internal audit institutions on the internal control of financial reporting is invalid;
4. Major defects that have been found and reported to the board of directors and management have not been corrected within a reasonable time.
1. Failure to select and apply significant accounting policies in accordance with generally accepted accounting standards;
2. Failure to establish anti fraud procedures and control measures;
3. No corresponding control mechanism has been established or implemented for the accounting treatment of unconventional or special transactions, and there is no corresponding compensatory control;
4. There are one or more defects in the control of the financial reporting process at the end of the period, and it can not reasonably ensure that the prepared financial statements achieve the goal of authenticity and accuracy.
General defects are internal control defects that do not constitute major defects and important defects.
explain:
nothing
3. Identification standard of internal control defects in non-financial reporting
The quantitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
Index name major defect quantitative standard important defect quantitative standard general defect quantitative standard
Property loss direct property loss ≥ 6 million yuan, 3 million yuan ≤ direct property loss direct property loss 3 million yuan 6 million yuan
explain:
nothing
The qualitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
Qualitative standard of defect nature
1. Lack of democratic decision-making procedures for major issues or major mistakes in decision-making procedures;
2. Serious violation of national laws and regulations and punishment;
3. Lack of system control or failure of system for important business;
Major defects 4. Major defects in internal control have not been rectified;
5. Serious loss of middle and senior managers and senior technicians;
6. Negative news frequently appears in the media, involving a wide range;
7. Major production safety accidents occur.
1. Democratic decision-making procedures exist but are not perfect or there are general mistakes in decision-making procedures;
2. Major defects in important business systems or implementation;
Important defects 3. Important defects in internal control have not been rectified;
4. Serious loss of business personnel in key positions;
5. Negative news appeared in the media, involving local areas.
General defects are other internal space-time defects of non-financial reports except major defects and important defects.
explain:
nothing
（3） Identification and rectification of internal control defects
1. Identification and rectification of internal control defects in financial reporting
1.1. Major defects
Whether the company has any major defects in internal control over financial reporting during the reporting period
□ yes √ no
1.2. Important defects
Whether the company has any significant defects in internal control over financial reporting during the reporting period
□ yes √ no
1.3. General defect
There may be some general defects in the daily implementation of internal control procedures. Since the company has a dual supervision mechanism of self-evaluation and internal audit, and employs an accounting firm to conduct internal control audit, the defects have been found and confirmed, and will be rectified immediately, so that the risk can be controlled and will not have a substantive impact on the financial report.
1.4. After the above rectification, on the benchmark date of the internal control evaluation report, does the company have any major defects in the internal control of financial reporting that have not been rectified
□ yes √ no
1.5. After the above rectification, on the benchmark date of the internal control evaluation report, does the company have any important defects in the internal control of financial reporting that have not been rectified
□ yes √ no
2. Identification and rectification of internal control defects in non-financial reports
2.1. Major defects
Whether the company found any major defects in internal control over non-financial reporting during the reporting period
□ yes √ no
2.2. Important defects
Whether the company found any significant defects in internal control over non-financial reporting during the reporting period
□ yes √ no
2.3. General defect
There may be some general defects in the daily implementation of internal control procedures. As the company has a dual supervision mechanism of self-evaluation and internal audit, and employs an accounting firm to conduct internal control audit, once the defects are found and confirmed, they will be rectified immediately, so that the risk can be controlled, and there will be no material impact on the internal control of non financial reports.
2.4. After the above rectification, on the benchmark date of the internal control evaluation report, does the company find any major defects in non-financial reporting internal control that have not been rectified
□ yes √ no
2.5. After the above rectification, on the benchmark date of the internal control evaluation report, does the company find any important defects in the internal control of non-financial reporting that have not been rectified
IV Description of other major matters related to internal control
1. Rectification of internal control defects in the previous year
□ applicable √ not applicable
2. Operation of internal control in this year and improvement direction in the next year
√ applicable □ not applicable
The company continuously improves and revises the internal control system according to the changes of actual business and environment every year, and continues to promote internal control self-assessment and internal control supervision and inspection. There were no major and important defects in internal control during the reporting period. However, the construction of internal control system itself is a process of continuous strengthening and improvement. In 2022, the company will further improve the internal control system, standardize the implementation of the internal control system, strengthen the supervision and inspection of internal control, and promote the sustainable and healthy development of the company in combination with the changes of the company's development strategy and external environment.
3. Description of other major events
□ applicable √ not applicable
Chairman (authorized by the board of directors): Zhuang YueKai
