Internal control evaluation report in 2021
Wuxi Apptec Co.Ltd(603259) 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 Wuxi Apptec Co.Ltd(603259) (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 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 On the benchmark date of the internal control evaluation report, does the company have any major defects in the internal control of financial reporting
□ 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 benchmark 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 (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. 1. The main units included in the evaluation scope include: Wuxi Apptec Co.Ltd(603259) new drug development Co., Ltd., Shanghai Wuxi Apptec Co.Ltd(603259) new drug development Co., Ltd., wuxiapptec (Hong Kong) Limited, Wuhan Wuxi Apptec Co.Ltd(603259) new drug development Co., Ltd., Tianjin Wuxi Apptec Co.Ltd(603259) NEW drug development Co., Ltd., Suzhou Wuxi Apptec Co.Ltd(603259) new drug development Co., Ltd., Shanghai Hequan Pharmaceutical Co., Ltd., Changzhou Hequan Pharmaceutical Co., Ltd., stapharmaceutical Hong Kong Limited Wuxi apptec, Inc., Wuxi advanced therapies Inc., Shanghai Jinshi Pharmaceutical Technology Co., Ltd., Shanghai Hequan pharmaceutical research and Development Co., Ltd., Nantong Wuxi Apptec Co.Ltd(603259) Pharmaceutical Technology Co., Ltd., Shanghai Hequan Pharmaceutical Co., Ltd., Chengdu Wuxi Apptec Co.Ltd(603259) new drug development Co., Ltd., Huiyuan Biotechnology (Shanghai) Co., Ltd., etc. 2. Proportion of units included in the scope of evaluation:
Proportion of indicators (%)
The total assets of the units included in the evaluation scope accounted for 94.31% of the total assets in the company’s consolidated financial statements
The total operating income of the units included in the evaluation scope accounted for 91.19% 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:
Procurement business, sales business, engineering project management, fund management, investment business, information security, fixed asset management, etc. 4. High risk areas of focus mainly include:
Business ethics, anti fraud, procurement business, sales business and project management. 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
In this year, according to the relevant exemption provisions of the answers to the regulatory questions on the implementation of enterprise internal control normative system by listed companies (No. 1, general No. 1, 2011) issued by the China Securities Regulatory Commission: “if the company has merger and acquisition transactions in the reporting year, the evaluation of the effectiveness of internal control over financial reporting of the merged enterprise in this year can be exempted”, Oxford genetics Ltd. acquired in 2021 was not included in the scope of internal control evaluation. 7. Other explanatory matters
None. （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 other internal control supervision requirements. 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
Total net profit potential misstatement ≥ 10% of total net profit 5% of total net profit ≤ misstatement misstatement 5% of total net profit 10% of total net profit
Potential misstatement of total assets ≥ 1% of total assets, 0.5% of total assets ≤ misstatement misstatement 0.5% of total assets, 1% of total assets
Potential misstatement of operating revenue ≥ 1% of operating revenue, 0.5% of operating revenue ≤ misstatement misstatement 0.5% of operating revenue, 1% of operating revenue
Description: none.
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
Major defects 1 It is found that the directors, supervisors and senior managers have fraud, which seriously affects the standardized operation of the company; 2. The company corrects the published financial statements due to major errors and other reasons; 3. The external audit found that there was a material misstatement in the current financial statements, but the internal control failed to find the misstatement in the implementation process; 4. The supervision of the audit committee and the internal audit department on internal control is invalid.
Important defects 1 Failure to select and apply accounting policies in accordance with GAAP or failure to implement and have no corresponding compensatory control; 2. There are defects or a combination of defects in the control of the preparation process of the final financial report that can not reasonably ensure the authenticity and accuracy of the financial statements.
Other internal control defects in financial reporting that do not constitute major defects or important defects.
Description: none. 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
Potential loss potential loss ≥ 5% of total net profit ≤ potential loss potential loss 5% of total net profit
10% loss ＜ 10% 5% of total net profit
Description: none.
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
Major defects 1 Major mistakes in the company’s decision-making procedures; 2. The company violates national laws and regulations and is severely punished; 3. The company’s important business lacks system control or the system fails.
Important defects 1 General mistakes caused by the company’s decision-making procedures; 2. The company violates the internal rules and regulations of the enterprise, resulting in losses; 3. There are defects in the company’s important business system or system.
General defects 1 The decision-making efficiency of the company is not high; 2. There are defects in the company’s general business system or system; 3. The company has other defects.
Description: none. （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 major defects in internal control over financial reporting during the reporting period □ yes √ no 1.2 Important defects
Whether the company has significant defects in internal control over financial reporting during the reporting period □ yes √ no 1.3 General defect
There may be general defects in the daily operation of internal control. Due to the supervision mechanism of self-evaluation and internal audit, the company can continuously adjust and improve the internal control defects found, which will not have a substantive impact on the overall effectiveness of the company’s internal control and the realization of objectives. 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, whether the company has 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 reporting 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
None. 2.4. After the above rectification, on the benchmark date of the internal control evaluation report, does the company find any major defects in the 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, whether the company finds any important defects in non-financial reporting internal control that have not been rectified □ yes √ no 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 board of Directors believes that the company has maintained effective internal control in all major aspects in accordance with the requirements of the enterprise’s internal control standard system and relevant regulations. In the next year, combined with the changes of the company’s development strategy and external environment, the company will continue to improve and revise the internal control system, sort out and optimize various business processes, further strengthen the construction and implementation of internal control system, strengthen supervision and inspection, optimize the internal control environment, prevent business risks through effective internal control, and promote the healthy and sustainable development of the company. 3. Description of other major events
□ applicable √ not applicable
Chairman (authorized by the board of directors): Ge Li (Li Ge) Wuxi Apptec Co.Ltd(603259) March 23, 2022
