China Resources Chemical Innovative Materials Co.Ltd(301090)
Internal control evaluation report in 2021
China Resources Chemical Innovative Materials Co.Ltd(301090) all shareholders:
According to 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 company's (hereinafter referred to as the company's) internal control system and evaluation methods, and on the basis of internal control supervision and evaluation, we evaluated the effectiveness of the company's internal control on December 31, 2021.
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 China Resources Chemical Innovative Materials Co.Ltd(301090) , Zhuhai China Resources Chemical Materials Technology Co., Ltd., China Resources chemical new materials Co., Ltd., China Resources Chemical International Trade (Shanghai) Co., Ltd., Shenzhen China Resources Chemical Co., Ltd. and China Resources Chemical International Co., Ltd. The total assets of the units included in the evaluation scope account for 100% of the total assets in the company's consolidated financial statements, and the total operating revenue accounts for 100% of the total operating revenue in the company's consolidated financial statements. The main businesses and matters included in the evaluation scope include: organizational structure, development strategy, human resources, social responsibility, corporate culture, capital activities, investment management, financing management, procurement business, long-term asset management, supply chain management, sales business, accounts receivable, research and development, engineering project, guarantee business, financial report, comprehensive budget, contract management, information disclosure, information system, network security Internal audit, inventory management and trade management, with a total of 25 business modules; The high-risk areas of focus mainly include: research and development, inventory management, engineering project management, safety and environmental protection, information system operation and safety, contract performance, 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.
（2） 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's internal control standard system and external supervision requirements.
The board of directors of the company adjusted the identification standard of internal control defects in previous years according to the identification requirements of the enterprise internal control standard system for major defects, important defects and general defects, combined with the changes of the company's scale, industry characteristics, risk preference, risk tolerance and other factors, and distinguished the internal control of financial report from the internal control of non-financial report. The identification standard of internal control defects after adjustment is as follows:
The identification standards of internal control defects determined by the company are as follows:
1. Identification criteria for defects in internal control over financial reporting
The quantitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Major defects of the project major defects general defects
Potential misstatement of total profit ≥ 5% of total profit ≤ 3% of total profit ＜ misstatement of total profit ＜ 3% of total profit
At 5% of false positives
Potential misstatement of total assets ≥ 3% of total assets ≤ 0.5% of total assets ≤ misstatement ＜ 0.5% of total assets ＜ 3% of total assets
Total misstatement of operating income ≥ 0.5% of total operating income ≤ misstatement economic misstatement amount of total operating income potential misstatement 1% of total operating income 0.5%
Owner's equity misstatement ≥ 0.5% of total owner's equity ≤ misstatement misstatement 1% of total owner's equity potential misstatement 0.5% of total owner's equity
The above standards directly depend on the importance of financial reporting misstatement that may be caused by the existence of internal control defects. This degree of importance mainly depends on two factors: whether the defect will lead to the failure of internal control to prevent or detect and correct the misstatement of financial reports in time; The amount of potential misstatement that may be caused by the defect alone or in combination with other defects.
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Qualitative standard of defect nature
The company lacks scientific decision-making procedures or the decision-making procedures lead to major mistakes; Serious violation of national laws, major defects and regulations and huge punishment; Serious loss of key management personnel or important talents, affecting normal operation; Lack of system control or system failure of important business; Identify the fraud of senior management personnel related to financial reporting; Major defects in internal control have not been rectified.
The company's decision-making procedures exist but are not perfect or there are major mistakes in the decision-making procedures; Violation of national laws, important defects and regulations and causing losses; Massive loss of business personnel in key positions; There are important defects in important business systems or systems; Important defects in internal control have not been rectified.
General defects are mainly practices that violate the best operating principles and may lead to low efficiency, and generally do not directly cause operation and management risks.
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:
Major defects of the project major defects general defects
Loss of total profit ≥ 3% of total profit ≤ loss ＜ loss of total profit ＜ 3% of total profit 5%
Total asset loss ≥ 0.5% of total assets ≤ loss total asset loss 0.5% of total assets 3% of total assets
Total loss of operating income ≥ 0.5% of total operating income ≤ loss economic loss 1% of total operating income 1% of total operating income 0.5%
Loss of owner's equity ≥ 0.5% of total owner's equity ≤ loss loss 1% of total owner's equity 1% of total owner's equity 0.5%
The qualitative criteria for the evaluation of internal control defects in non-financial reporting determined by the company are as follows:
Qualitative standard of defect nature
The company lacks scientific decision-making procedures or the decision-making procedures lead to major mistakes; Serious violation of national laws, major defects and regulations and huge punishment; Serious loss of key management personnel or important talents, affecting normal operation; Lack of system control or system failure of important business; Identify the fraud of senior management personnel related to financial reporting; Major defects in internal control have not been rectified.
Qualitative standard of defect nature
The company's decision-making procedures exist but are not perfect or there are major mistakes in the decision-making procedures; Violation of national laws, important defects and regulations and causing losses; Massive loss of business personnel in key positions; There are important defects in important business systems or systems; Important defects in internal control have not been rectified.
General defects are mainly practices that violate the best operating principles and may lead to low efficiency, and generally do not directly cause operation and management risks.
(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. During the reporting period, the general defects in internal control of individual financial reports found through evaluation and test have been rectified in time, so that the risk is within the controllable range and does not constitute a material impact on the benchmark date of internal control evaluation report.
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. During the reporting period, the general defects of internal control of individual non-financial reports found through evaluation and test have been rectified in time, so that the risk is within the controllable range and does not constitute a material impact on the benchmark date of internal control evaluation report.
4、 Description of other major matters related to internal control
None.
China Resources Chemical Innovative Materials Co.Ltd(301090) board of directors April 8, 2022
