Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) internal control assurance report
Zhitong Certified Public Accountants (special general partnership)
catalogue
Internal control assurance report
Self evaluation report on internal control related to financial statements on December 31, 2021 1 1-4
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Internal control assurance report
Zhi Tong Zhi Zi (2022) No. 332a005266 Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) all shareholders:
We have accepted the entrustment to verify the confirmation of the board of directors of Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) (hereinafter referred to as Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) company) on the effectiveness of internal control related to financial statements on December 31, 2021 The responsibility of the board of directors of Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) company is to establish and improve internal control and maintain its effectiveness in accordance with the basic norms of enterprise internal control, and ensure that the attached self-evaluation report on internal control related to financial statements of Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) company on December 31, 2021 truly and completely reflects the internal control related to financial statements of Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) company on December 31, 2021. Our responsibility is to express opinions on the effectiveness of internal control related to the financial statements of Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) company on December 31, 2021.
We have carried out the assurance work in accordance with the provisions of other assurance business standards for Chinese certified public accountants No. 3101 – assurance business other than audit or review of historical financial information. In the process of assurance, we have implemented other procedures including understanding, testing and evaluating the rationality of internal control design and effectiveness of implementation related to financial statements, as well as other procedures we deem necessary. We believe that our assurance provides a reasonable basis for expressing opinions.
Internal control has inherent limitations, and there is the possibility that misstatement may occur and not be found due to error or fraud. In addition, as changes in circumstances may lead to inappropriate internal control or reduce the degree of compliance with control policies and procedures, it is risky to speculate the effectiveness of internal control in the future according to the internal control assurance results.
We believe that Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) company has effectively maintained the internal control related to financial statements established in accordance with the basic norms of enterprise internal control in all major aspects on December 31, 2021.
This assurance report is only used by Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) company when disclosing the annual report, and shall not be used for any other purpose. Zhitong certified public accountants China Certified Public Accountants
(special general partnership)
Chinese certified public accountant
Beijing, China, April 6, 2002
Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710)
Self evaluation report on internal control in 2021
Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) all shareholders:
In accordance with 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 Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) (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).
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、 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.
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.
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 Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) , Zhejiang xinwangzhuoxin Technology Co., Ltd., Hangzhou Yibin Technology Co., Ltd., Hangzhou Xingse Technology Co., Ltd., Dongguan Yingmai Communication Technology Co., Ltd., Hangzhou Wanlong Communication Technology Co., Ltd., Zhejiang Wanlong communication equipment Co., Ltd. and Hangzhou Longsheng Investment Co., Ltd. The total assets of the units included in the evaluation scope account for 100% of the total assets in the company’s financial statements, and the total operating revenue accounts for 100% of the total operating revenue in the company’s financial statements; The main businesses included in the evaluation scope include: Shaanxi Broadcast & Tv Network Intermediary(Group)Co.Ltd(600831) equipment, data communication system, broadband access terminal, wireless communication equipment, optical communication equipment, internet intelligent equipment and other products, as well as the R & D, production, sales and technical services of optical fiber data communication solutions, network security solutions and industrial control communication solutions, integrating operation services Comprehensive services and investment management of value-added telecom services integrating content services.
The main items included in the evaluation scope include: organizational structure, development strategy, human resources, corporate culture, capital activities, procurement and payment business, asset management, sales and collection business, production process and cost control, related party transaction management, guarantee business, R & D, information management, etc; The high-risk areas of focus mainly include capital activities, procurement and payment business, sales and collection business, etc.
The above units, businesses, matters and high-risk areas included in the evaluation scope cover the control items required by the basic norms of enterprise internal control and the application guidelines of enterprise internal control, without major omissions, and meet the relevant requirements of enterprise internal control.
(II) 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.
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 standards of internal control defects in financial reports
The quantitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Degree of importance
Major defects major defects general defects
order
Potential misstatement and misstatement of operating revenue ≥ 1% of total operating revenue ≤ misstatement ＜ operating revenue
2% of total revenue is reported as less than 2% of total operating revenue and 1% of total revenue
Potential misstatement of total assets ≥ 1% of total assets ≤ misstatement ＜ misstatement ＜ total assets
2% of total assets 1% of total assets
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
(1) Signs of significant defects in internal control over financial reporting include:
① Fraud by directors, supervisors and senior managers of the company;
② Major internal control deficiencies that have been found and reported to the management have not been corrected after a reasonable time;
③ The certified public accountant finds that there is a material misstatement in the current financial report, but the internal control fails to find the misstatement in the operation process;
④ Make misstatement correction for major errors in the announced financial report;
⑤ Other defects that may affect the correct judgment of report users.
(2) Signs of significant defects in internal control over financial reporting include:
① Failure to select and apply accounting policies in accordance with GAAP;
② Failure to establish anti fraud procedures and control measures;
③ For the accounting treatment of unconventional or special transactions, no corresponding control mechanism has been established or no corresponding compensatory measures have been implemented;
④ For one or more defects existing in the process of financial reporting at the end of the period, and there is no reasonable guarantee that the prepared financial report can achieve the goal of authenticity and accuracy.
(3) General defects in internal control over financial reporting refer to other control defects in addition to the above major 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:
The quantitative standard for the evaluation of internal control defects in non-financial reports shall be implemented with reference to the quantitative standard for the evaluation of internal control defects in financial reports.
The qualitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
The identification of defects in internal control over non-financial reporting is mainly determined by the severity of the business nature, the nature of direct or potential negative impact, the scope of impact and other factors.
(1) Signs of significant defects in internal control over non-financial reporting include:
The company’s internal decision-making system or other major defects that may not be rectified or have a significant negative impact on the company’s internal decision-making system, lack of scientific control or other major defects.
(2) Signs of significant defects in internal control over non-financial reporting include:
① Defects in important business systems or processes;
② Major mistakes in decision-making procedures;
③ Serious loss of personnel in key positions;
④ Important defects found in internal control and internal supervision are not rectified in time;
⑤ Other situations that have a great negative impact on the company.
(3) General defects in internal control over non-financial reporting refer to other control defects other than the above major and important 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.
(IV) description of other major matters related to internal control
During the reporting period, the company did not explain other major matters related to internal control.
Chairman (authorized by the board of directors): Hangzhou Prevail Optoelectronic Equipment Co.Ltd(300710) April 6, 2022
