China Railway Prefabricated Construction Co.Ltd(300374)
Internal control evaluation report in 2021
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、 Construction and operation of the company's internal control system
In accordance with the relevant provisions of the basic norms of enterprise internal control and the application guidelines issued by the Ministry of Finance and other five ministries and commissions and the guidelines for the standardized operation of companies listed on the gem of Shenzhen Stock Exchange issued by Shenzhen Stock Exchange, and in accordance with the working requirements of the company's internal control system of "promoting level by level, horizontal to edge, vertical to the end and comprehensive coverage", the company has established the framework of internal control system in the headquarters and all subsidiaries and branches, The internal control system has covered all aspects of the company's operation, production, sales, management and control. According to the business module, it has prepared the working standards and procedure documents of business processes such as corporate governance, strategic management, production and operation, information disclosure, legal compliance, safety, quality and environmental protection, human resources, financial management, procurement management and information management, and formulated the operation and management measures of the internal control system, the company and its subsidiaries The internal control management of the branch company has evidence to rely on. At the same time, the company actively takes effective control activities to prevent various risks and ensure the orderly operation of production and operation.
(I) construction and operation of internal control at the enterprise level
In accordance with the company law, the guidelines for the governance of listed companies and other relevant laws and regulations and the relevant provisions and requirements of Shenzhen Stock Exchange, the company has continuously improved the construction of internal control system to ensure the effective development of enterprise operation and management.
1. Continuously improve the construction of internal control system. In 2021, all departments of the company actively benchmarked the advanced units, standardized the operation mechanism, carried out benchmarking and improvement, gradually improved the corporate governance structure, governance system construction and decision-making procedure construction, accelerated the implementation of "building the foundation" closely around the company's development strategy, improved the system, deepened the reform, strengthened management and supervision, and improved the scientific decision-making mechanism.
2. Further promote the construction of corporate governance system. In order to improve corporate governance, the company has gradually drafted and revised the measures for internal reporting on major matters, the measures for the management of information disclosure, the measures for the follow-up inspection and evaluation of the implementation of resolutions of the general meeting and the board of directors, the rules of procedure of the special committee of the board of directors and the working rules of the general manager from the perspective of business reality. 149 new release systems have been formulated, and the initial realization of "managing affairs and people with systems" has been realized, The main work has rules to follow. In terms of institutional management, we will gradually establish a modern state-owned enterprise management system with Chinese characteristics that is systematic, scientific, standardized and efficient, so as to "have rules to follow and evidence to check", and constantly strengthen the level of governance.
3. Actively carry out internal control evaluation. In accordance with the spirit of the basic norms of enterprise internal control and supporting guidelines, and in accordance with the requirements of China Railway Prefabricated Construction Co.Ltd(300374) 2021 annual internal control evaluation work plan, the company has carefully, carefully and comprehensively organized and carried out the annual internal control evaluation, achieved the division of tasks and compacted the risk prevention and control responsibilities at all levels.
4. Strengthen education and prevent and control integrity risks. The company uses the discipline inspection column platform to release learning materials on the theme of "clean family style", typical cases and regulations, so that the majority of Party members, cadres and employees can strengthen the integrity prevention and control risks in different fields through the "Online + offline" education mode, remind them to tighten the "string of integrity" at all times, and further improve the integrity quality.
(II) construction and operation of internal control of important business
2021 is the first year of the company's 14th five year plan and a key year for the three-year reform of state-owned enterprises. "One point deployment and nine points implementation". Guided by the thought of Xi Jinping socialism with Chinese characteristics in the new era, we should fully implement the three-year action plan for the reform of state-owned enterprises and the work requirements of the SASAC, spare no effort to promote the implementation of the three-year reform action and strengthen risk prevention with the tenacity of grasping the iron mark and stepping on the stone.
1. Continuously deepen corporate governance. In the past year, China Railway Prefabricated Construction Co.Ltd(300374) integrated a number of three-level branches and cancelled a number of three-level companies. This year, it promoted the equity withdrawal of three subordinate joint-stock companies. At present, one joint-stock withdrawal has been completed. The reduction of these companies not only optimizes the organizational structure of the company, but also enhances the vitality and performance ability of the company.
2. Strengthen financial risk control and actively carry out the function application of financial sharing platform. In 2021, in order to further strengthen the legal compliance of all units in dealing with financial matters and the unity of financial forms, the company actively carried out the functional application of financial sharing platform. Through efforts, the company has completed the construction of Financial Sharing Center in the second half of 2021 and has been fully put into use. Through the management of Financial Sharing Center and the data mining and analysis of accounting platform, the company has improved the standardization, standardization and informatization level of financial management, Enhanced the ability of financial risk control.
3、 Internal control evaluation conclusion
1. Whether the company has 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
4、 Internal control evaluation
According to the relevant requirements of the enterprise internal control standard system, the company organized the evaluation around the work of the enterprise center in 2021, actively deployed the internal control evaluation in 2021, formulated the internal control evaluation work plan, and defined the overall requirements, organizational leadership, evaluation basis, procedure and method, evaluation content, defect identification, time node and other work contents of the evaluation work, Guide the whole company to carry out evaluation work in an orderly manner.
(I) internal control procedures and methods
The evaluation is carried out in the way of unified deployment, graded implementation, and the combination of self-evaluation and special inspection. The specific evaluation procedures include: formulating the evaluation work plan, the company's headquarters and subordinate units carrying out on-site testing at different levels, preliminarily identifying internal control defects, rectifying internal control defects, special inspection of internal control evaluation, summarizing the evaluation results, finally confirming the defects, and preparing and reporting the evaluation report.
The overall method of internal control evaluation is sampling method, and the comprehensive use of individual interview, walk through test, comparative analysis, thematic discussion and other methods. According to the company level and business process, according to the frequency of business occurrence and the level of inherent risk, a certain proportion of business samples are selected to test the compliance of business samples and draw the evaluation conclusion of the test.
(II) 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.
1. The main units included in the evaluation scope include: China Railway Prefabricated Construction Co.Ltd(300374) , China Railway Prefabricated Construction Co.Ltd(300374) Style Construction Technology Co., Ltd., China Railway Prefabricated Construction Co.Ltd(300374) Technology (Suqian) Co., Ltd., China Railway Prefabricated Construction Co.Ltd(300374) Technology (Wusu) Co., Ltd., Beijing Hengtong vision import and export sales Co., Ltd., China Railway Prefabricated Construction Co.Ltd(300374) science and Technology (Turpan) Co., Ltd., China Railway Prefabricated Construction Co.Ltd(300374) Technology (Kashi) 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:
Organizational structure, development strategy, human resources, corporate culture, fund management, procurement management, asset management, engineering project management, research and development, guarantee management, financial report, comprehensive budget, contract management, information management, internal information transmission, financial management, investment management, control of holding subsidiaries, etc. 4. High risk areas of focus mainly include:
Health, safety and environmental protection risk, project subcontracting risk, inventory risk and clean government construction 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
(III) internal control evaluation basis and internal control defect identification standard
The company organizes and carries out internal control evaluation in accordance with the requirements of the enterprise internal control standard system, the guidelines for comprehensive risk management of central enterprises and the guidelines for self discipline supervision of listed companies of Shenzhen Stock Exchange No. 2 - standardized operation of companies listed on GEM issued by Shenzhen Stock Exchange.
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
Pre tax profit misstatement ≥ 5% of pre tax profit, pre tax profit 3% ≤ misstatement pre tax misstatement pre tax profit 3%
Profit 5%
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) Fraud by directors, supervisors and senior managers; (2) There are significant misstatements in the current financial statements, but the major defects of internal control cannot be found in the operation process (; 3) the supervision of the company's audit and risk management committee and internal audit institutions on internal control is invalid; (4) The company corrects the published financial report.
(1) There are defects in the internal control of the financial reporting process at the end of the period, which have a significant impact; (2) There are important defects in the compliance control function
In the defects, the violations may have a significant impact on the financial reporting.
General defects general defects refer to other control defects except major defects and important defects.
explain:
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are:
Major defect refers to the combination of one or more control defects, which may cause the enterprise to seriously deviate from the control objectives. Major defects are recognized when the following circumstances occur:
(1) Fraud by directors, supervisors and senior managers;
(2) There is a material misstatement in the current financial statements, but the internal control fails to find the misstatement in the operation process;
(3) The supervision of the company's audit and risk management committee and internal audit institutions on internal control is invalid;
(4) The company corrects the published financial report.
Important defect refers to the combination of one or more control defects, whose severity and economic consequences are lower than those of major defects, but it may still cause the enterprise to deviate from the control objectives. Defects in the following fields with strong signs of major defects are recognized as important defects:
(1) There are defects in the internal control of the financial reporting process at the end of the period, which have a significant impact;
(2) Compliance control post
