Securities code: Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) securities abbreviation: Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) Announcement No.: 2022027 Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710)
Announcement on the company and its subsidiaries continuing to carry out foreign exchange derivatives transactions
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) (hereinafter referred to as "the company") held the 15th meeting of the 4th board of directors and the 11th meeting of the 4th board of supervisors on April 6, 2022, and considered and adopted the proposal on the company and its subsidiaries to continue to carry out foreign exchange derivatives trading, It is agreed that the company and its subsidiaries continue to carry out foreign exchange derivatives trading business with banks and other financial institutions approved by relevant government departments and with relevant business operation qualifications, with an accumulated amount of no more than 50 million yuan or equivalent foreign currency, for a period of 12 months after the deliberation and approval of the board of directors, which can be recycled and used in a rolling manner. The specific trading conditions shall be subject to the actual business needs of the company and real-time transaction delivery. At the same time, the chairman of the company is authorized to handle specific business and sign relevant documents within the above limit. If the duration of a single transaction exceeds the authorization period, the authorization period will be automatically extended until the termination of the transaction. Relevant matters are hereby announced as follows:
1、 Reasons and purposes for carrying out foreign exchange derivatives trading business
In order to meet the needs of the company's operation and development of foreign exchange business, avoid the risks of foreign exchange market and lock in foreign exchange costs, the company and its subsidiaries plan to carry out foreign exchange derivatives trading business with banks and other financial institutions approved by relevant government departments and qualified for relevant business operation.
2、 Basic information of foreign exchange derivatives trading business
(I) currencies and business types involved
The currency of the proposed foreign exchange derivatives business is limited to the main settlement currency used by the company and its subsidiaries in their daily operations.
The types of foreign exchange derivatives business to be carried out this time include but are not limited to forward settlement and sales of foreign exchange, foreign exchange swaps, foreign exchange options, interest rate swaps, interest rate swaps and other products or a combination of the above products.
(II) business scale and source of investment
The company and its subsidiaries intend to carry out foreign exchange derivatives trading business with an accumulated amount of no more than 50 million yuan or equivalent foreign currency for a period of 12 months after the deliberation and approval of the board of directors, which can be recycled and used on a rolling basis. The specific trading conditions are subject to the actual business needs of the company and real-time transaction delivery.
The source of funds for the company and its subsidiaries to carry out foreign exchange derivatives trading business this time is their own funds and funds raised by the company in other ways permitted by laws and regulations, which does not involve raising funds.
(III) term and authorization
The board of directors of the company authorizes the chairman to implement the foreign exchange derivatives trading business plan and sign relevant agreements and documents in accordance with the relevant management systems of the company. The authorization period is 12 months after the approval of the board of directors. If the duration of a single transaction exceeds the authorization period, the authorization period will be automatically extended to the termination of the transaction. (IV) counterparty
Banks and other financial institutions approved by relevant government departments and qualified for foreign exchange derivatives business.
3、 Risk analysis of foreign exchange derivatives trading business
The company's foreign exchange derivatives trading business will follow the principle of prudence and will not carry out foreign exchange trading for the purpose of speculation. All foreign exchange derivatives trading businesses are based on normal operation, relying on specific business operations and aiming at avoiding and preventing exchange rate risks. However, there are certain risks in foreign exchange derivatives trading, mainly including:
1. Market risk: due to large changes in the foreign exchange market, there may be a market risk of loss due to changes in the price of foreign exchange derivatives caused by market price fluctuations such as the underlying interest rate and exchange rate.
2. Liquidity risk: the risk that the transaction cannot be completed due to insufficient market liquidity.
3. Internal control risk: foreign exchange derivatives trading is highly professional and complex. It belongs to a business with high internal control risk, which may cause risks due to imperfect internal control system.
4. Customer default risk: the customer's accounts receivable are overdue and the payment cannot be recovered within the predicted recovery period, which may affect the company's cash flow status, resulting in the fact that the cash flow cannot completely match the term or amount of the operated foreign exchange derivatives business.
5. Payment collection prediction risk: the company's business department makes payment and payment collection prediction according to customer orders, purchase orders and expected orders, but in the actual implementation process, it may adjust its own orders and forecasts, resulting in inaccurate payment collection prediction of the company, resulting in the risk of delayed delivery of foreign exchange derivatives.
6. Other possible risks: in the specific business, if the operator fails to accurately, timely and completely record the information of foreign exchange financial derivatives investment business, it may lead to the loss of foreign exchange financial derivatives business or the loss of trading opportunities; At the same time, if the traders fail to fully understand the terms of the transaction contract and product information, they will face legal risks and transaction losses.
4、 Risk management measures for carrying out foreign exchange derivatives trading business
1. According to the relevant provisions of the company's management system for foreign exchange derivatives trading business, the company shall not engage in speculation and illegal arbitrage transactions. All foreign exchange derivatives trading businesses are based on normal production and operation, based on specific business operations, and for the purpose of avoiding and preventing exchange rate or interest rate risks. The system makes clear provisions on the company's business operation principles, approval authority, management and information disclosure, meets the relevant requirements of the regulatory authorities, meets the needs of actual operation, and the risk control measures formulated are practical and effective.
2. The company will carefully review the contract terms signed with the bank and strictly implement the risk management system to prevent risks.
3. As the relevant responsible departments, the finance department and the Audit Department of the company have clear management positioning and responsibilities, which fundamentally eliminate the risk of single person or single department operation, and improve the response speed to the risk on the premise of effectively controlling the risk.
4. The company conducts foreign exchange derivatives trading business with banks and other financial institutions approved by relevant government departments and qualified for foreign exchange derivatives trading business, closely tracks laws and regulations in relevant fields, and avoids possible legal risks.
5. The Audit Department of the company shall regularly or irregularly check the transaction process, approval procedures, handling records and accounting information related to foreign exchange derivatives trading business.
6. The company completed the information disclosure in strict accordance with the relevant provisions of Shenzhen Stock Exchange. 5、 Accounting policies and accounting principles
According to the relevant provisions and guidelines of accounting standards for Business Enterprises No. 22 - recognition and measurement of financial instruments, accounting standards for Business Enterprises No. 24 - hedging and accounting standards for Business Enterprises No. 37 - presentation of financial instruments issued by the Ministry of finance, the company conducts corresponding accounting treatment for the proposed foreign exchange derivatives trading business, reflecting the relevant items of the balance sheet and income statement.
6、 Opinions of independent directors and board of supervisors
1. Opinions of independent directors
The independent directors believe that the company and its subsidiaries carry out foreign exchange derivatives trading business in order to avoid the risk of foreign exchange market and prevent the negative impact of large exchange rate fluctuations on the company.
Meanwhile, the company has formulated the Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) foreign exchange derivatives trading business management system, improved the relevant business approval process and formulated targeted risk control measures. The procedures for the board of directors to review the matter are legal and compliant, comply with the provisions of relevant laws and regulations, and there is no situation that damages the interests of shareholders of the company. All independent directors unanimously agree that the company shall carry out foreign exchange derivatives trading within the limit approved by the board of directors, and the validity period is 12 months from the date of approval by the board of directors.
2. Opinions of the board of supervisors
The board of supervisors believes that: the company carries out foreign exchange derivatives trading business according to the actual business needs, and its decision-making procedures comply with the provisions of relevant national laws, regulations and the articles of association, which is conducive to avoiding the risk of the foreign exchange market, locking in the foreign exchange cost, reducing the impact of exchange rate fluctuations on the company, and there is no situation that damages the interests of the company and all shareholders, especially small and medium-sized shareholders. Therefore, the board of supervisors agrees that the company and its subsidiaries and banks and other financial institutions approved by relevant government departments and with relevant business operation qualifications shall carry out foreign exchange derivatives trading business with an accumulated amount of no more than 50 million yuan or equivalent foreign currency for a period of 12 months after the deliberation and approval of the board of directors, which can be used in a circular and rolling manner. The specific trading conditions shall be subject to the actual business needs of the company and real-time transaction delivery. 7、 Documents for future reference
1. Resolutions of the 15th meeting of the 4th board of directors of the company;
2. Resolutions of the 11th meeting of the 4th board of supervisors of the company;
3. Independent opinions of independent directors on relevant matters considered at the 15th meeting of the Fourth Board of directors.
Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) board of directors April 7, 2022
