Greatoo Intelligent Equipment Inc(002031)
Internal control evaluation report in 2021
Greatoo Intelligent Equipment Inc(002031) 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 the company (hereinafter referred to as the "company"), on the basis of daily supervision 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, on the benchmark date of the internal control evaluation report, the company has no major defects in the internal control over financial reporting. 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) scope of internal control evaluation
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 the company and all subsidiaries included in the consolidation scope. 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, corporate culture, social responsibility, procurement business, sales business, asset management, investment management, financial report, management of subsidiaries, related party transactions, external guarantee, information disclosure, etc. The main areas of focus include:
1. Organizational structure
Establish and improve the normative structure of the board of directors and the general meeting of the company in accordance with the law of the people's Republic of China on corporate governance, the basic rules of corporate governance, the law of the people's Republic of China on corporate governance, the law of the people's Republic of China on corporate governance, the general meeting of the board of supervisors and other laws and regulations. The general meeting of shareholders is the highest authority of the company; The board of directors is the decision-making body of the company and is responsible for the general meeting of shareholders; The board of supervisors shall supervise the directors, managers and other senior managers of the company to perform their duties according to law and be responsible for the general meeting of shareholders. The management is responsible to the board of directors and presides over the production, operation and management of the company.
The company has formulated important decision-making systems such as the rules of procedure of the general meeting of shareholders, the rules of procedure of the board of directors, the rules of procedure of the board of supervisors, the rules of procedure of the special committees of the board of directors and the working rules of the general manager, defined the responsibilities and powers of decision-making, implementation and supervision, and formed a scientific and effective division of responsibilities and check and balance mechanism to enable them to perform their respective duties, fulfill their responsibilities, check and balance each other, make scientific decisions and standardize operation.
2. Human resource management
According to the labor law and relevant laws and regulations, the company has established and improved personnel management systems such as employee recruitment, training, assessment, reward and punishment and promotion, which provides a favorable guarantee for the company to attract, retain and motivate talents; Clarify the responsibilities, authorities, qualifications and work requirements of each post, and carry out post training and education for different posts according to the needs of actual work, so as to ensure that employees can be competent for their posts.
3. Control implemented in daily business activities
The company has formulated and implemented a series of systems covering the whole process of production and operation management, including procurement management, sales management, production management, inventory management and financial management, so as to ensure the legal compliance of the company's operation and management, asset safety and improve the company's operation efficiency and effect.
4. Investment management
The company has formulated the procedures and rules for major production and operation, major investment and important financial decision-making, defined the decision-making procedures and rules for major investment and other matters, standardized the company's purchase and disposal of assets, foreign investment and disposal, and stipulated that major investment matters can be implemented only after being deliberated and approved by the company's board of directors or shareholders' meeting.
5. Subsidiary management
The company has formulated the subsidiary management system, which stipulates the personnel management, financial management, operation and investment decision-making management and information management of subsidiaries, strengthens the management control of subsidiaries, standardizes the internal operation mechanism and protects the legitimate rights and interests of investors.
6. Related party transaction management
The company has formulated the management measures for related party transactions, which clearly stipulates the judgment of related parties, identification of related party transactions, approval authority of related party transactions, review procedures, avoidance of voting and information disclosure, regulates related party transactions, and ensures that the related party transactions of the company are legal and compliant and do not harm the interests of the company and all shareholders.
7. External guarantee management
The company has formulated the management measures for external guarantee, which clearly stipulates the principles, approval authority and procedures to be followed for external guarantee, so as to ensure the legal compliance of the company's external guarantee matters and effectively control the guarantee risk.
8. Information disclosure management
In accordance with the requirements of laws, regulations and normative documents such as the company law, the securities law and the Listing Rules of Shenzhen Stock Exchange, and in combination with the actual situation of the company's information disclosure and investor relations management, the company has formulated relevant information management systems such as the internal reporting system of major information and the management system of information disclosure affairs, and defined the company's shareholders, directors, supervisors The responsibilities of senior executives and other functional departments such as the securities affairs department in information disclosure have standardized the process, content and time limit of the company's information disclosure to ensure the legality and compliance of the company's information disclosure.
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 other relevant regulations and in combination with the actual situation of the company.
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
(1) The quantitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Quantitative standard of defect type
The amount of misstatement ≥ 2% of the consolidated operating income of the previous year or is classified as a major defect at the end of the previous year
2% of the net assets belonging to the shareholders of the listed company (whichever is lower)
The amount of misstatement of major defects is between the quantitative standards of major defects and general defects
The amount of misstatement is less than 0.5% of the consolidated operating income of the previous year, and the amount of misstatement is generally defective
0.5% of the net assets attributable to the shareholders of the listed company at the end of the previous year
(2) The qualitative criteria for the evaluation of defects in internal control over financial reporting determined by the company are as follows: any of the following signs may indicate that there are significant defects in the company's internal control over financial reporting:
① Fraud by directors, supervisors and senior managers;
② Correct the amount of profit involved in the published financial report and lead to changes in the nature of profit and loss (from profit to loss, or from loss to profit);
③ The certified public accountant finds that there is a material misstatement in the current financial statements, but the internal control fails to find the misstatement in the operation process;
④ Other defects that may affect the correct judgment of report users.
Any of the following signs may indicate that there are important defects in the internal control of financial reporting: ① failure to select and apply accounting policies in accordance with the accounting standards for business enterprises;
② Failure to establish anti fraud procedures and control measures;
③ No corresponding control mechanism has been established or implemented for the accounting treatment of unconventional or special transactions, and there is no corresponding compensatory control;
④ There are one or more defects in the control of the financial reporting process at the end of the period, and it can not reasonably ensure that the prepared financial statements achieve the true and complete goal.
Other control defects other than the above major and important defects are regarded as general defects.
2. Identification standard of internal control defects in non-financial reporting
(1) The quantitative standards for the evaluation of internal control defects in non-financial reports determined by the company are as follows: the quantitative standards for the evaluation of internal control defects in non-financial reports shall be implemented with reference to the quantitative standards for the evaluation of internal control defects in financial reports.
(2) The qualitative criteria for the evaluation of internal control defects in non-financial reports determined by the company are as follows: the qualitative criteria for the evaluation of internal control defects in non-financial reports are mainly determined according to the nature, scope and other factors of the potential negative impact of defects.
The following circumstances may indicate that there are significant defects in the company's internal control over non-financial reporting, and other circumstances are identified as significant defects or general defects according to the degree of impact:
① Lack of democratic decision-making procedures, such as collective decision-making procedures;
② Major events violate the existing decision-making procedures, resulting in major economic losses of the company;
③ Serious violations and heavy penalties or criminal responsibility;
④ Serious loss of middle and senior managers or technicians in key positions;
⑤ The company's reputation is frequently damaged by news; ⑥ Lack of institutional control or systematic failure of important business;
⑦ Major defects in internal control or major defects have not been rectified.
(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 did not have 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
During the reporting period, the company has no other major matters related to internal control that need to be explained.
Greatoo Intelligent Equipment Inc(002031) April 13, 2022
