Company code: Keeson Technology Corporation Limited(603610) company abbreviation: Keeson Technology Corporation Limited(603610) Keeson Technology Corporation Limited(603610)
Internal control evaluation report in 2021
Keeson Technology Corporation Limited(603610) 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 company’s (hereinafter referred to as the company’s) internal control system and evaluation methods, and 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 internal control evaluation report). I 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. II Internal control evaluation conclusion 1 On the benchmark date of the internal control evaluation report, does the company have any major defects in the internal control of financial reporting
□ yes √ no
2. Evaluation conclusion of internal control over financial reporting
√ valid □ invalid
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. 3. Whether significant defects in internal control over non-financial reporting are found
□ yes √ no
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. 4. Factors affecting the evaluation conclusion of internal control effectiveness from the base date of internal control evaluation report to the date of issuance of 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. 5. Whether the internal control audit opinion is consistent with the company’s evaluation conclusion on the effectiveness of internal control over financial reporting
√ yes □ No 6 Whether the disclosure of major defects in internal control of non-financial reports in the internal control audit report is consistent with the disclosure of the company’s internal control evaluation report √ yes □ no III Internal control evaluation (I) Scope of internal control evaluation
The company determines the main units, businesses and matters as well as high-risk areas included in the evaluation scope according to the risk oriented principle. 1. The main units included in the scope of evaluation include: Keeson Technology Corporation Limited(603610) headquarters, Jiaxing Wesco sponge Co., Ltd., Zhejiang Sofitel home furnishing Co., Ltd., Zhejiang Qisheng Data Service Co., Ltd., Shuford Intelligent Technology (Hangzhou) Co., Ltd., Zhejiang Qiyue Technology Co., Ltd., Shuford Investment Co., Ltd., ergomotion, Inc. (ogmosen Co., Ltd.), ergomotion EU, UAB, South Bay International, Inc., keeson (Binh Duong) Co., Ltd., softide Technology Co., limited, Shenzhen yuandingsheng investment limited partnership (limited partnership), Linsheng investment (Hainan) Co., Ltd., Qisheng data (Shanghai) Co., Ltd Egger Intelligent Technology (Jiaxing) Co., Ltd., softide spring Co., limited and other 16 holding subsidiaries.
2. Proportion of units included in the scope of evaluation:
Proportion of indicators (%)
The ratio of the total assets of the units included in the evaluation scope to the total assets of the company’s consolidated financial statements 100
The total operating income of the units included in the evaluation scope accounts for 100% of the total operating income in the company’s consolidated financial statements
3. The main operations and matters included in the scope of evaluation include:
The main businesses included in the evaluation scope include the R & D, manufacturing and sales of intelligent electric beds, mattresses and their supporting products, as well as intelligent data services. The main items included in the evaluation scope include corporate governance, organizational structure, human resources, social responsibility, corporate culture, financial reporting, investment and financing management, procurement business, asset management, production management, sales business, engineering management, contract management, administrative management, internal supervision, information communication, etc. 4. High risk areas of focus mainly include:
Production management risk, sales management risk, fund management risk, asset safety risk and investment management risk. 5. 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. Is there any major omission □ yes √ No 6 Is there a statutory exemption
7. Other explanatory matters
None. （2） Basis of internal control evaluation and identification standard of internal control defects
The company organizes the internal control evaluation according to the enterprise internal control standard system and the internal control system for Keeson Technology Corporation Limited(603610) corporate governance and standardized operation. 1. Whether the specific identification standard of internal control defects is adjusted with that of previous years
□ yes √ no
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.
2. 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:
Index name major defect quantitative standard important defect quantitative standard general defect quantitative standard
There are misstatements in operating revenue. The amount of misstatement ≥ 1% of total operating revenue ≤ the amount of misstatement ＜ 2% of total operating revenue ＜ 2% 1% of total operating revenue
There are misstatements in the total profit. The amount of misstatement ≥ 5% of the total profit and 3% of the total profit ≤ the amount of misstatement the amount of misstatement 3% of the total profit and 5% of the total profit
Amount of misstatement of total assets: ≥ 1% of total assets, 0.5% of total assets: ≤ amount of misstatement, amount of misstatement ＜ 0.5% of total assets ＜ 1% of total assets
Description: none.
The qualitative criteria for the evaluation of internal control defects in financial reporting determined by the company are as follows:
Qualitative criteria for defect properties
Major defects (1) fraud of directors, supervisors and senior managers of the company; (2) Material misstatement in the current financial report found by the certified public accountant but not identified by the company’s internal control; (3) The audit committee’s supervision over the company’s external financial report and internal control over financial report is invalid; (4) Major defects that have been found and reported to the management have not been corrected within a reasonable time.
Significant defects (1) failure to select and apply accounting policies in accordance with generally accepted accounting standards; (2) Failure to establish anti fraud procedures and control measures; (3) There are individual or multiple defects in the process of financial reporting, which do not meet the identification standards of major defects, but affect the authenticity, accuracy and integrity of the financial report.
General defects general defects refer to other control defects other than the above major defects and important defects.
Note: Based on this, it is judged that the defect may lead to the possibility of misstatement (high, medium and low), including but not limited to: (1) the defect may lead to the correction and traceability of the issued financial report; (2) There is a material misstatement in the current financial statements, but the internal control fails to find the misstatement in the operation process; (3) Ineffective audit committee or internal audit function; (4) Fraud of directors, supervisors and senior management; (5) Ineffective risk management function; (6) Invalid control environment; (7) Major defects are not rectified in a reasonable time.
3. 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:
Index name major defect quantitative standard important defect quantitative standard general defect quantitative standard
Direct property loss ≥ 1.5% of total assets ≤ 1% of total assets 1% of total assets
Loss amount ＜ of total assets
1.5%
Description: None
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 possibility of major defects is high, which will seriously reduce the work efficiency or effect, or seriously increase the uncertainty of the effect, or make it seriously deviate from the expected goal.
The possibility of important defects is high, which will significantly reduce the work efficiency or effect, or significantly increase the uncertainty of the effect, or significantly deviate from the expected goal.
General defects are less likely to occur, which will reduce work efficiency or effect, or increase the uncertainty of effect, or make it deviate from the expected goal.
Note: Based on this, we can judge the possibility (high, medium and low) that the defect may cause losses, including but not limited to: (1) the enterprise’s decision-making procedure is unscientific, such as decision-making mistakes, resulting in the enterprise’s failure to achieve the expected goal; (2) Serious loss of management or technical personnel; (3) Negative media reports frequently appear; (4) The results of internal control evaluation, especially major or important defects, have not been rectified; (5) Lack of institutional control or systematic failure of important business. （3） Identification and rectification of internal control defects 1 Identification and rectification of internal control defects in financial reporting 1.1 Major defects
Whether the company has major defects in internal control over financial reporting during the reporting period □ yes √ no 1.2 Important defects
Whether the company has significant defects in internal control over financial reporting during the reporting period □ yes √ no 1.3 General defect
The general internal control defects found by the company will not affect the realization of control objectives; The company attaches great importance to the general internal control defects found during the reporting period, has put forward rectification opinions and actively formulated corresponding rectification plans for rectification and implementation. 1.4. After the above rectification, on the benchmark date of the internal control evaluation report, does the company have any major defects in the internal control of financial reporting that have not been rectified □ yes √ no
1.5. After the above rectification, on the benchmark date of the internal control evaluation report, whether the company has any important defects in the internal control of financial reporting that have not been rectified □ yes √ No 2 Identification and rectification of internal control defects in non-financial reporting 2.1 Major defects
Whether the company found any major defects in internal control over non-financial reporting during the reporting period □ yes √ no 2.2 Important defects
Whether the company found any significant defects in internal control over non-financial reporting during the reporting period □ yes √ no 2.3 General defect
The general internal control defects found by the company will not affect the realization of control objectives; The company attaches great importance to the general internal control defects found during the reporting period, has put forward rectification opinions and actively formulated corresponding rectification plans for rectification and implementation. 2.4. After the above rectification, on the benchmark date of the internal control evaluation report, does the company find any major defects in the non-financial reporting internal control that have not been rectified □ yes √ no 2.5 After the above rectification, on the benchmark date of the internal control evaluation report, whether the company finds any important defects in non-financial reporting internal control that have not been rectified □ yes √ no IV Description of other major matters related to internal control 1 Rectification of internal control defects in the previous year □ applicable √ not applicable 2 Operation of internal control in this year and improvement direction in the next year
√ applicable □ not applicable
In 2021, the company attaches great importance to internal
