Huabao Flavours & Fragrances Co.Ltd(300741)
Work report of the board of supervisors in 2021
In 2021, the board of supervisors of Huabao Flavours & Fragrances Co.Ltd(300741) (hereinafter referred to as “the company”) conscientiously performed the duties of the board of supervisors, actively and effectively carried out work and promoted the standardized operation of the company in strict accordance with the company law of the people’s Republic of China, the Securities Law of the people’s Republic of China, the articles of association, the rules of procedure of the board of supervisors and relevant laws and regulations. The supervisors attended the board of directors and the general meeting of shareholders as nonvoting delegates, and supervised the company’s production and operation activities, major events, financial status, use of raised funds and performance of duties by directors and senior managers, so as to effectively safeguard the interests of the company and the interests of shareholders. The main work report of 2021 is as follows:
1、 Work of the board of supervisors during the reporting period
During the reporting period, the board of supervisors of the company held a total of 5 meetings, as follows:
1. On March 19, 2021, the company held the fifth meeting of the second board of supervisors, deliberated and passed the following proposals:
(1) 2020 annual report and its summary;
(2) Work report of the board of supervisors in 2020;
(3) Financial statement report of 2020;
(4) 2020 profit distribution plan;
(5) 2020 internal control evaluation report;
(6) Special report on the deposit and use of raised funds in 2020;
(7) Proposal on depositing part of the raised funds in the form of time deposit;
(8) Proposal on using some idle raised funds and self owned funds to purchase financial products;
(9) Proposal on reviewing the remuneration of supervisors in 2020;
(10) Proposal on changing the purpose of some raised funds and adjusting the implementation plan of some raised investment projects; (11) Proposal on purchasing directors, supervisors and senior managers’ liability insurance.
2. On April 26, 2021, the company held the sixth meeting of the second board of supervisors, deliberated and adopted the report of the first quarter of 2021.
3. On August 20, 2021, the company held the seventh meeting of the second board of supervisors, deliberated and passed the following proposals:
(1) Semi annual report of Huabao Flavours & Fragrances Co.Ltd(300741) 2021 and its summary;
(2) Special report on the deposit and use of raised funds in the half year of 2021;
(3) Proposal on increasing the amount of cash management with idle raised funds.
4. On September 29, 2021, the company held the eighth meeting of the second board of supervisors, deliberated and passed the proposal on increasing the amount of cash management using idle raised funds.
5. On October 26, 2021, the company held the ninth meeting of the second board of supervisors, deliberated and adopted the report of the third quarter of Huabao Flavours & Fragrances Co.Ltd(300741) 2021.
2、 Opinions of the board of supervisors on relevant matters of the company in 2021
1. Legal operation of the company
The board of supervisors participates in the discussion of major decisions of the company by consulting relevant documents, attending meetings of the board of directors as nonvoting delegates and attending general meetings of shareholders, and supervises the proposals and meeting procedures deliberated by each board of directors and general meetings of shareholders in accordance with the law. The board of supervisors believes that the company’s decision-making procedures are legal and compliant, the construction of internal control system is continuously strengthened, and the corporate governance is further improved; The operation of the board of directors was standardized and the resolutions of the general meeting of shareholders were carefully implemented; Directors and senior managers are devoted to their duties, diligent and responsible, and do not violate laws and regulations, the articles of association or damage the interests of the company and shareholders.
2. Financial situation of the company
The board of supervisors carefully inspected and supervised the company’s financial status, operating results and financial management, and issued audit opinions on the periodic reports. In the opinion of the board of supervisors, the company’s financial condition and financial system are sound; The audit opinion issued by PricewaterhouseCoopers Zhongtian Certified Public Accountants (special general partnership) on the company’s 2021 annual financial report is objective and fair. The report truly, accurately and completely reflects the company’s financial status and operating results.
3. Use of funds raised by the company
The board of supervisors inspected and supervised the company’s raised funds, consulted relevant materials, and considered that the storage and use of the company’s raised funds met the requirements of relevant laws and regulations and the company’s measures for the management of raised funds, and there were no violations of raised funds.
During the reporting period, the company decided to change the purpose of some raised funds and adjust the implementation plan of some raised investment projects according to the actual situation and development strategy of the implementation of the raised investment projects. The above matters have fulfilled the necessary deliberation procedures in accordance with the requirements of relevant laws and regulations, and have been deliberated and approved by the 2020 annual general meeting of shareholders. The company’s decision to change the purpose of some raised funds and adjust the implementation plan of some raised investment projects is based on careful analysis and Research on the actual situation of the company and the project, which is conducive to controlling project risks, improving fund use efficiency, meeting the actual business needs of the company, and there is no damage to the interests of the company and all shareholders.
During the reporting period, in order to improve the use efficiency of raised funds and increase the company’s income, the company and its holding subsidiaries used idle raised funds of no more than 1.7 billion yuan for cash management. The necessary review procedures have been performed for the above matters in accordance with the requirements of relevant laws and regulations. The amount of cash management by the company using the raised funds does not exceed the amount approved by the general meeting of shareholders. There is no behavior of changing the purpose of the raised funds in a disguised manner, which is in line with the interests of the company and all shareholders.
4. Related party transactions of the company
The board of supervisors supervised and verified the related party transactions of the company and believed that the related party transactions of the company in 2021 followed the transaction principle of objectivity, fairness and impartiality and performed the decision-making procedures in accordance with relevant regulations. The related party transactions of the company meet the actual needs of daily operation and strategic development. There is no transfer of interests in the transaction process, the transaction price is fairly priced, and there is no damage to the shareholders’ rights and interests of non related parties.
5. Internal control of the company
The board of supervisors believes that the company has established a sound internal control system, which meets the requirements of relevant national laws and regulations and the actual needs of the company’s production, operation and management, and can be effectively implemented. The 2021 internal control evaluation report issued by the board of directors truly and objectively reflects the actual situation of the company’s internal control.
6. Management of insider information
During the reporting period, the company strictly implemented the relevant provisions and requirements of the registration and management system for insiders, standardized the information transmission process, and timely completed the registration and filing of insiders. During the reporting period, the company and relevant personnel did not use insider information to buy and sell the company’s shares and their derivatives.
3、 2022 annual work plan of the board of supervisors
In 2022, the board of supervisors will continue to strictly implement the requirements of relevant laws and regulations, the articles of association and the rules of procedure of the board of supervisors, strengthen its own learning, faithfully and diligently perform its duties, strengthen its supervision and management functions, focus on and supervise the company’s financial situation, the use of raised funds and other major matters, and effectively safeguard the interests of the company and all shareholders.
Huabao Flavours & Fragrances Co.Ltd(300741) board of supervisors
March 25, 2022
