Hunan Xiangjia Animal Husbandry Company Limited(002982)
Self evaluation report on internal control in 2021
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 the internal control system and evaluation methods of Hunan Xiangjia Animal Husbandry Company Limited(002982) (hereinafter referred to as the "company"), 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 of the company 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 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.
The company has no factors affecting the evaluation conclusion of internal control effectiveness from the benchmark date of internal control evaluation report to the date of issuance of 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 Hunan Xiangjia Animal Husbandry Company Limited(002982) and its subsidiaries within the scope of merger. 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 businesses and matters included in the evaluation scope include: corporate governance, organizational structure, development strategy, human resources, corporate culture, social responsibility, research and development, safety and environmental protection, market development, customer service, operation project management, engineering project management, procurement management, fund management, financial management, comprehensive budget, investment management, asset management, external guarantee, legal affairs, contract management, capital operation Information management, internal control audit, financial report, control of holding subsidiaries, etc.
The high-risk areas of focus mainly include: market competition, price fluctuation of raw materials, customer dependence, materials and procurement, fund management, financial management, safety and environmental protection, related party transactions, information disclosure, etc.
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, and there are no major omissions.
(II) basis of internal control evaluation and identification standard of internal control defects
The company organizes and carries out internal control evaluation in accordance with the standard system of enterprise internal control, the basic norms of enterprise internal control, the rules for the preparation and reporting of information disclosure of companies offering securities to the public No. 21 - General Provisions on annual internal control evaluation report and other laws and regulations, regulatory provisions and relevant provisions of the articles of association, and in combination with the actual situation of the company.
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. The identification standards of internal control defects determined by the company are as follows:
1. 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:
Major defects of project influence degree, important defects and general defects
Operating revenue misstatement 0.5% of total operating revenue misstatement ≤ operating revenue
1% ＜ misstatement ≤ 0.5% of total operating revenue
1% of the amount
Total profit misstatement 5% of total profit ＜ misstatement ≤ total profit
10% ≤ 5% of 10% of total profit
Misstatement of total assets 0.5% of total assets misstatement ≤ total assets
1% of total assets ≤ 0.5% of 1% of total assets
Owner's equity (including minority shareholders' misstatement) owner's right. Misstatement of total owner's equity ≤ owner's right
3% (1.5%) of equity misstatement ≤ 1.5% of total owner's equity
3% of total equity
Note 1: the "total assets", "owner's equity", "operating income", "total profit" and other data in the above table are the data of the consolidated statement of the previous year.
Note 2: for the above four identification standards, defects shall be identified according to which one is higher.
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
1) Defects with the following characteristics are recognized as major defects:
A. Fraud by directors, supervisors or senior managers of the company.
B. There are major errors in the company's announced financial report.
C. The external audit found that there were significant misstatements in the financial report, but they were not identified by the company's internal control.
D. The supervision of the audit committee and the internal audit department over the company's external financial reports and internal control over financial reports is invalid.
2) Defects with the following characteristics are recognized as important defects:
A. It is found that non management has committed or is suspected of fraud.
B. Indirectly lead to material misstatement or omission of financial report.
C. Other defects that may affect the correct judgment of financial statements or statement users.
3) General defects: refer to other control defects other than the above major defects and important defects.
2. 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:
Major defects of project influence degree, important defects and general defects
Direct loss amount ＞ 0.5% of total assets ＜ direct loss amount ≤ 1% of total assets, followed by loss amount ≤ 0.5% of total assets
1% of the amount
Note: the "total assets" in the above table for reference and comparison is the data of the consolidated statement of the previous year.
The qualitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
1) Major defects are identified in the following similar situations:
A. The unscientific decision-making procedure of the company leads to major decision-making mistakes and heavy property losses to the company.
B. Violation of relevant laws and regulations, company procedures or standard operating procedures, and significant negative impact on the disclosure of the company's periodic reports.
C. Major fraud occurred.
D. Lack of system control or systematic failure of important business, resulting in major losses identified according to the above quantitative standards.
E. Other situations that have a significant negative impact on the company.
2) The following similar situations are identified as important defects:
A. The unscientific decision-making procedure of the company leads to losses identified according to the above quantitative standards.
B. Violation of the internal rules and regulations of the enterprise, resulting in losses identified according to the above quantitative standards.
C. There are defects in important business systems or systems, resulting in losses identified according to the above quantitative standards.
D. Important or general defects in internal control have not been rectified.
3) In addition to the above major defects and important defects, other control defects are recognized as general defects.
(III) identification and rectification of internal control defects
1. Identification and rectification of internal control defects in financial reporting
According to the above identification standards of internal control defects in financial reporting, the company has no major defects or important defects in internal control of financial reporting during the reporting period.
2. Identification and rectification of internal control defects in non-financial reports
According to the above identification standards of internal control defects in non-financial reports, no major defects or important defects in the company's internal control over non-financial reports were found during the reporting period.
4、 Description of other major matters related to internal control
During the reporting period, the company has no other major matters related to internal control that need to be explained.
The board of directors of the company noted that the internal control should be adapted to the company's business scale, business scope, competition and risk level, and should be adjusted in time as the situation changes. In the future, the company will continue to improve the internal control system, standardize the implementation of the internal control system, strengthen the supervision and inspection of internal control, and promote the healthy and sustainable development of the company.
Hunan Xiangjia Animal Husbandry Company Limited(002982) board of directors
March 22, 2022
