Risk assessment report on Hubei Yihua Chemical Industry Co.Ltd(000422) Group Finance Co., Ltd
According to the requirements of self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 7 - transactions and related party transactions, Hubei Yihua Chemical Industry Co.Ltd(000422) (hereinafter referred to as "the company") has checked whether it has a valid financial license and business license of enterprise legal person; Obtain and review the regular financial reports of 2021, including balance sheet, income statement and cash flow statement, and evaluate the business qualification, business and financial risks of Hubei Yihua Chemical Industry Co.Ltd(000422) Group Finance Co., Ltd. (hereinafter referred to as "finance company"), the company's related party. The specific situation is reported as follows:
1、 Basic information of finance company
The finance company is approved by Bank Of China Limited(601988) industry supervision and Administration Commission (financial license institution code 00433406) and registered with Yichang Administration for Industry and Commerce (Unified Social Credit Code: 91420500582496287t). It is invested by Hubei Yihua Chemical Industry Co.Ltd(000422) Group Co., Ltd. (capital contribution ratio: 80%), Hubei Shuanghuan Science And Technology Stock Co.Ltd(000707) (capital contribution ratio: 10%) Guizhou Yihua Chemical Co., Ltd. (10%) is a non bank financial institution jointly invested and established in 2011, with a registered capital of 500 million yuan.
The financial company has established a perfect corporate governance structure in accordance with the requirements of modern enterprise system and financial supervision department. The highest authority of the finance company is the board of shareholders, which consists of the board of directors, the board of supervisors, the strategy and audit committee, the risk and related party transactions Committee, and the nomination and Remuneration Committee. The finance company implements the general manager responsibility system under the leadership of the board of directors. According to the requirements of business development and internal control system, it has six departments: settlement business department, credit management department, risk control department, audit department, planning and finance department and comprehensive management department.
Upon the examination and approval of Bank Of China Limited(601988) Industry Regulatory Commission, the finance company operates the following domestic and foreign currency businesses: ⑴ handle financial and financing consulting, credit assurance and relevant consulting and agency businesses for member units; (2) assist member units to realize the collection and payment of transaction funds; (3) approved insurance agency business; (4) provide guarantee to member units; (5) handle bill acceptance and discount for member units; (6) handle entrusted loans between member units; (7) handle the internal transfer settlement between member units and the corresponding settlement and clearing scheme design; (8) absorbing deposits from member units; (9) engage in inter-bank lending and apply for loans to member units.
2、 Basic information of internal control of finance company
(I) control environment
The highest authority of the finance company is the shareholders' meeting, which consists of the board of directors and the board of supervisors. The board of directors is mainly responsible for determining the overall business strategy and major policies of the finance company, regularly inspecting and evaluating the implementation, and ensuring that the company establishes and implements a full and effective internal control system; Be responsible for ensuring that the company operates prudently within the framework of laws and policies, and ensure that the senior management takes necessary measures to identify, measure, monitor and control risks. The board of supervisors is responsible for supervising the board of directors and senior management to improve the internal control system; Be responsible for supervising the board of directors and directors, senior management and senior management to perform internal control duties; Be responsible for requiring directors, chairman and senior managers to correct their behaviors that harm the interests of the company and supervise the implementation.
The finance company implements the general manager responsibility system under the leadership of the board of directors, organizes the implementation of the resolutions of the board of directors, exercises the command of the company's operation and management, and presides over the company's daily operation and management.
The finance company has always put strengthening the construction of internal control mechanism, standardizing operation, preventing and resolving financial risks in the first place. Based on cultivating employees with good professional ethics and professional quality and improving employees' risk prevention awareness, the company has comprehensively improved the company's internal control system by strengthening or improving various systems such as internal audit, training education, assessment and incentive mechanism. (II) risk identification and assessment
The finance company has developed a sound internal control management system. The implementation of the internal control system is organized by the company's management. Each business department formulates its own standardized operation processes, operation standards and risk prevention measures according to the different characteristics of each business. The audit department supervises and evaluates the implementation of internal control. Each department shall separate responsibilities and supervise each other, and predict, evaluate and control various risks in self operation.
(III) important control activities
1. Fund management business control
According to the rules and regulations of Bank Of China Limited(601988) industry supervision and Administration Commission, the finance company has formulated various business management methods and business operation processes for fund management and settlement management, and effectively controlled business risks.
(1) In terms of the deposit business of member units, strictly follow the principles of equality, voluntariness, fairness and good faith, operate strictly within the normative authority issued by the CBRC, ensure the safety of the funds of member units and safeguard the legitimate rights and interests of member units.
(2) In terms of centralized fund management and internal transfer settlement business, the financial company mainly relies on the business management information system for system control. Member units open settlement accounts in the financial company, and realize fund settlement by logging in to the business management information system of the financial company, submitting instructions online and submitting written instructions, so as to strictly ensure the safety, quickness and smoothness of settlement, and have high data security at the same time. The financial company formulates a strict reconciliation mechanism. The system can realize the online reconciliation function. The seals and important blank vouchers are kept separately and are not allowed to be taken out of the company. 2. Credit business control
(1) Construction and implementation evaluation of internal control system
In accordance with the general principles of loans, the measures for the administration of financial companies of enterprise groups and the relevant provisions of Bank Of China Limited(601988) Insurance Regulatory Commission and the people's Bank of China, the finance company has formulated the credit management measures as a programmatic document and more than 12 specific operating procedures accordingly, forming a comprehensive and highly operational business system and comprehensively covering the credit business carried out by the finance company. At the same time, the finance company revised and improved the relevant internal control system according to the requirements of the policy and specification documents issued by the regulatory authorities in recent years, so as to make the business more standardized.
(2) Post loan inspection
The finance company has formulated the operating procedures for post loan inspection and the management measures for credit asset quality monitoring, and the credit department has conducted post loan inspection on units with stock loans on a quarterly basis. At the same time, the risk management personnel shall monitor the quality of credit assets and the implementation of post loan inspection.
3. Capital business control
The finance company has formulated a number of internal control systems, including the management rules for interbank lending business and the operating procedures for bank acceptance bill rediscount and rediscount business. At present, the bill rediscount business and bill rediscount business have been carried out in strict accordance with the internal management system and operating procedures. The basic information of the counterparty is complete, the transfer agreement OECD review procedures, fund transfer and accounting treatment are accurate.
4. Internal audit control
The finance company implements the internal audit supervision system, establishes the internal audit department - Audit Department, which is responsible for the management, and establishes relatively complete internal audit management methods and operating procedures, including the management measures for audit work and the management measures for post supervision, so as to conduct internal audit and supervision on various operation and management activities.
The audit department is responsible for internal audit. Supervise and inspect the implementation of internal control, the legality, compliance, safety, accuracy and effectiveness of business and financial activities, and put forward valuable improvement opinions and suggestions to the management.
5. Information system control
The current information system identity authentication of the financial company adopts two forms of user password and USBKEY digital certificate for hierarchical management, with reasonable and safe control. The business function module of the system includes 11 modules, including user and business management, customer management, account management, fund plan, settlement management, bank enterprise direct connection, credit management, special business processing, report management, end of day business processing, risk monitoring and early warning, and realizes the business processing functions related to settlement management, credit management, fund plan, report management, user management, authority allocation, approval process management, etc, The system supports fund collection and allocation, online payment and real-time reconciliation, realizes the linkage between bank enterprise interconnection, internal and external accounts, fund plans, credit contracts and other related business data, and realizes the business process control between cross modules.
3、 Operation management and risk management of finance company
(I) operation
According to the audit of Lixin certified public accountants, as of the end of December 2021, the total assets of the finance company were 344765672347 yuan, the liabilities were 280476183204 yuan, the net assets were 64289489143 yuan, the operating income was 1 China National Electric Apparatus Research Institute Co.Ltd(688128) 989 yuan and the net profit was 158547139 yuan.
(II) management
Since its establishment, the finance company has always adhered to the principle of sound operation, standardized its business behavior and strengthened its internal management in strict accordance with the company law of the people's Republic of China, the law of the people's Republic of China on banking supervision and administration, the accounting standards for business enterprises, the measures for the administration of financial companies of enterprise groups, relevant national financial laws, regulations and the articles of association.
(III) regulatory indicators
Standard value of S / N indicator actual value in current period
1. Capital adequacy ratio ≥ 10% 22.10%
2. Proportion of borrowed funds ≤ 100% 0.00%
3. Proportion of short-term securities investment ≤ 40% 0.00%
4. Proportion of guarantee balance ≤ 100% 60.66%
5. Long term investment ratio ≤ 30% 0.00%
6. Proportion of self owned fixed assets ≤ 20% 0.07%
(IV) deposits and loans of shareholders
As of December 31, 2021, relevant indicators are as follows:
Monetary unit: 10000 yuan
Shareholder name investment amount deposit loan
Hubei Yihua Chemical Industry Co.Ltd(000422) Group Co., Ltd. 40 China Vanke Co.Ltd(000002) 69668760000
Hubei Shuanghuan Science And Technology Stock Co.Ltd(000707) 5,000.00 28,832.39 10,028
Guizhou Yihua Chemical Co., Ltd. 500000 0.00 0.00
4、 Business development of the company and finance company
As of December 31, 2021, the monetary fund balance of the company was 384386771639 yuan, of which the deposit balance in the finance company was 90893711276 yuan, accounting for 23.65% of the monetary fund balance of the company. The company can independently use the deposits in the finance company, and the deposit interest rate shall rise according to the deposit interest rate uniformly issued by the people's Bank of China, which is higher than that of other financial institutions in the same period. The deposits in the finance company have not affected the normal production and operation of the company. The company's loan interest rate in the financial company is not higher than that of other financial institutions in the same period, and the charging standard of other financial services is not higher than (or equal to) the same level of business expenses of other financial institutions in China. The pricing is fair and reasonable, and does not damage the interests of the company and the legitimate rights and interests of its shareholders.
Based on the above analysis and judgment, the company believes that the financial company has legal and effective financial license and business license of enterprise legal person, has corresponding business qualifications, operates legally and in compliance, and has established a relatively complete and reasonable internal control system, which can better control risks. The financial company operates in strict accordance with the measures for the administration of financial companies of enterprise groups (CBRC order [2006] No. 8), and its basic financial indicators comply with the provisions of the people's Bank of China, Bank Of China Limited(601988) Insurance Regulatory Commission and other regulatory bodies. According to the company's understanding and evaluation of risk management, no major defects are found in the risk management of the financial company, and there are no risk problems in the related deposit and loan and other financial businesses between the company and the financial company.
