Lingyi Itech (Guangdong) Company(002600)
Self evaluation report on internal control in 2021
Lingyi Itech (Guangdong) Company(002600) 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 the internal control system and evaluation methods of Lingyi Itech (Guangdong) Company(002600) (hereinafter referred to as the "company"), 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 self-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.
1. Main units included in the scope of evaluation
The total assets of the company, Lingyi Technology (Shenzhen) Co., Ltd. and its subsidiaries, Shenzhen Dongfang Liangcai Precision Technology Co., Ltd. and its subsidiaries and Jiangmen Jiangyi magnetic materials Co., Ltd. included in the evaluation scope account for 99.5% of the total assets in the company's consolidated financial statements, and the total operating revenue accounts for 99.5% of the total operating revenue in the company's consolidated financial statements.
2. Main operations and matters included in the scope of evaluation
Organizational structure, development strategy, human resources, capital activities (including fund-raising and investment activities), procurement business, sales business, asset management, engineering projects, R & D and development, guarantee business, financial report, comprehensive budget, related party transactions, internal information transmission and information system, etc. The high-risk areas of focus mainly include capital activities (including fund-raising and investment activities), procurement business, asset management, sales business, engineering projects, etc.
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, and there are no major omissions.
(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 and the company's internal control evaluation management measures. 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 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:
Evaluation dimension major defect important defect general defect
Potential impact in the financial report ＞ 0.5% of total assets ≤ potential impact ≤ potential impact of assets ＜ 1% of the control defect of total assets department, or 1% of total potential impact assets, or 0.5% of 2% of operating revenue, or potential impact ＞ 4% of operating revenue, potential impact ≤ 4% of operating revenue ＜ 2% of operating revenue
Note: the above is based on the data of the company's consolidated financial statements.
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Major defects: major misstatement in the financial report cannot be prevented, discovered and corrected in time due to individual defects or other defects. In case of the following circumstances, it shall be deemed as a major defect:
(1) Which may lead to false records, misleading statements or material omissions in the financial statements;
(2) It may lead to the illegal situation caused by the misstatement of the financial report;
(3) It may lead to fraud and embezzlement of enterprise assets by the governance and management;
(4) The probability of occurrence exceeds 80% and directly affects the financial report;
(5) Other circumstances that may cause the company's financial report to be deemed invalid.
Important defects: those misstatements in the financial report that cannot be prevented, discovered and corrected in time due to individual defects or other defects, although they do not reach or exceed the importance level, but still deserve the attention of the board of directors and management. In case of any of the following circumstances, it shall be deemed as an important defect:
(1) May cause inaccurate financial accounting, but will not affect the basic judgment of statement users; (2) The probability of occurrence exceeds 50% and directly affects the financial report;
(3) Other that may affect the accuracy of the company's financial accounting.
General defect: it does not constitute a major defect or an important defect, and is recognized as a general defect in the following circumstances: (1) it may cause errors in the process of financial accounting and reporting, but will not directly form errors in accounting and reporting;
(2) The probability of occurrence exceeds 30% and directly affects the financial report;
(3) Other that may affect the reliability of the company's financial report and the safety of assets.
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:
Evaluation dimension major defect important defect general defect
Internal control defects in non-financial reports may cause internal control defects, may cause internal control defects in the actual industry, may cause control defects in the actual department, affect the actual business deviation from the budget, the proportion of business deviation from the budget target, the proportion of business deviation from the budget target, the proportion of response to the target ≥ 50% 30% ≤ the deviation proportion 50% 10% ≤ the deviation proportion 30%
Qualitative criteria for evaluation of internal control defects in non-financial reporting determined by the company:
(1) It may cause the company's strategic objectives to be completely impossible to achieve and affect the company's sustainable operation;
(2) It may cause abnormal low operating efficiency of the company and seriously violate the principle of cost-effectiveness;
(3) May cause the company to seriously violate the law and may affect the company's continuous operation;
(4) It may cause serious fraud or embezzlement of the company's assets by the company's management and management;
(5) May cause the failure of the internal supervision mechanism.
Important defects:
(1) May cause the company's annual work plan to be unable to be completed, but will not affect the company's future development; (2) It may cause the operation and management benefits of the company to be lower than the average level of the industry;
(3) It may cause the company's behavior to violate laws and regulations, and may be required to bear relevant legal responsibilities by external regulators;
(4) It may cause the inefficiency of the internal supervision mechanism and affect the normal implementation of the company's policies.
General defects:
(1) It may affect the company's short-term objectives and be difficult to achieve, but it will not affect the company's annual objectives; (2) It may affect the efficiency of business management and is not conducive to the continuous improvement of the company;
(3) May cause minor violations of laws and regulations by the company and employees, but will not cause actual losses; (4) Other regulatory requirements and company policies should be identified as internal control 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 and 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 and important defects in the company's internal control over non-financial reports were found during the reporting period.
4、 Description of other major matters related to internal control
The company has no explanation on other major matters related to internal control.
Board of directors April 7, 2002
