Implementation rules of the audit committee of the board of directors
(revised in April 2022)
Chapter I General Provisions
Article 1 in order to strengthen the decision-making function of the board of directors, achieve prior audit and professional audit, ensure the effective supervision of the board of directors over the management, improve the corporate governance structure and improve the level of corporate governance, In accordance with the company law of the people's Republic of China, the standards for the governance of listed companies, the basic norms of enterprise internal control, the stock listing rules of Shanghai Stock Exchange, the self regulatory guidelines for listed companies of Shanghai Stock Exchange No. 1 - standardized operation, the articles of association and other relevant provisions, the company hereby establishes the audit committee of the board of directors and formulates these implementation rules.
Article 2 the audit committee of the board of directors is a special committee under the board of directors, which is mainly responsible for communication, supervision and verification with internal and external auditors. The audit committee shall be responsible to the board of directors and report its work to the board of directors. The proposal of the committee shall be considered and decided by the board of directors.
Article 3 the members of the audit committee shall ensure sufficient time and energy to perform the duties of the committee, be diligent and responsible, effectively supervise the external audit of the listed company, guide the internal audit of the company, promote the company to establish effective internal control and provide true, accurate and complete financial reports.
Article 4 the company shall provide necessary working conditions for the audit committee. When the audit committee performs its duties, the company's management and relevant departments shall cooperate.
Chapter II personnel composition
Article 5 the audit committee is composed of five to seven directors, and at least one independent director is an accounting professional.
Article 6 in principle, the members of the audit committee shall be independent of the daily operation and management of the company. Members of the audit committee shall be diligent and responsible, effectively supervise and evaluate the internal and external audit work of listed companies, promote the company to establish effective internal control and provide true, accurate and complete financial reports.
Article 7 members of the audit committee shall have professional knowledge and experience in performing the duties of the audit committee.
Article 8 among the members of the audit committee, independent directors shall account for the majority and act as the convener. The members who act as the convener shall be accounting professionals.
Article 9 The term of office of the members of the audit committee is the same as that of the board of directors. Upon expiration of their term of office, members may be re elected. If any member ceases to hold the position of director of the company during the period, he will automatically lose the qualification of member, and the committee will make up the number of members according to the provisions of Articles 5 to 8 above.
Article 10 the audit committee takes the audit department as its daily office and is responsible for daily work liaison and meeting organization.
Chapter III responsibilities and authorities
Article 11 the main responsibilities and authorities of the audit committee are as follows:
(I) supervise and evaluate the work of external audit institutions;
(II) supervise and evaluate the internal audit work;
(III) review the company's financial report and express opinions on it;
(IV) supervise and evaluate the company's internal control;
(V) coordinate the communication between the management, internal audit department and relevant departments and external audit institutions;
(VI) other matters authorized by the board of directors of the company and other matters involved in laws and regulations and relevant provisions of Shanghai Stock Exchange.
Article 12 the responsibilities of the audit committee to supervise and evaluate the work of external audit institutions must at least include the following aspects:
(I) evaluate the independence and professionalism of external audit institutions, especially the impact of non audit services provided by external audit institutions on their independence;
(II) propose to the board of directors to hire or replace the external audit institution;
(III) review the audit fees and employment terms of the external audit institution;
(IV) discuss and communicate with external audit institutions on audit scope, audit plan, audit methods and major matters found in the audit;
(V) supervise and evaluate whether the external audit institutions are diligent and responsible.
The audit committee shall not be unduly influenced by the company's major shareholders, actual controllers, directors, supervisors and senior managers when exercising its functions and powers in Item (II) (III) of the preceding paragraph.
The audit committee shall urge the external audit institutions to be honest, trustworthy, diligent and responsible, strictly abide by the business rules and industry self-discipline norms, strictly implement the internal control system, verify and verify the company's financial and accounting reports, perform the obligation of special care, and prudently express professional opinions.
Article 13 the responsibilities of the audit committee in guiding internal audit shall at least include the following aspects:
(I) review the company's annual internal audit work plan;
(II) supervise and urge the implementation of the company's internal audit plan;
(III) review the internal audit work report, evaluate the results of internal audit work, and urge the rectification of major problems;
(IV) guide the effective operation of the internal audit department.
The internal audit department of the company shall report to the audit committee. Various audit reports submitted by the internal audit department to the management, the rectification plan and rectification of audit problems must be submitted to the audit committee at the same time.
Article 14 the audit committee shall review the financial and accounting reports of listed companies, put forward opinions on the authenticity, accuracy and integrity of the financial and accounting reports, focus on the major accounting and audit problems of the company's financial and accounting reports, pay special attention to whether there are fraud, fraud and the possibility of major misstatement related to the financial and accounting reports, and supervise the rectification of the problems of the financial and accounting reports.
Article 15 the responsibility of the audit committee to evaluate the effectiveness of internal control shall at least include the following aspects: (I) evaluate the appropriateness of the design of the company's internal control system;
(II) review the internal control self-evaluation report;
(III) review the internal control audit report issued by the external audit institution, and communicate with the external audit institution the problems found and the improvement methods;
(IV) evaluate the results of internal control evaluation and audit, and urge the rectification of internal control defects.
Article 16 the responsibilities of the audit committee in coordinating the communication between the management, internal audit department and relevant departments and external audit institutions include:
(I) coordinate the communication between the management and external audit institutions on major audit issues;
(II) coordinate the communication between internal audit department and external audit institutions and the cooperation of external audit. Article 17 the audit committee shall report to the board of directors on the measures or improvements it deems necessary and put forward suggestions.
Article 18 If the Audit Committee deems it necessary, it may hire an intermediary institution to provide professional opinions, and the relevant expenses shall be borne by the company.
Article 19 when the company hires or replaces an external audit institution, the audit committee must form a review opinion and put forward suggestions to the board of directors before the board of directors can review relevant proposals.
Article 20 the audit committee shall cooperate with the supervisors of the board of supervisors in the audit activities of the company.
Chapter IV decision making procedures
Article 21 the audit department shall be responsible for the preliminary preparations for the decision-making of the audit committee and provide relevant written materials of the company:
(I) relevant financial reports of the company;
(II) work reports of internal and external audit institutions;
(III) external audit contract and related work report;
(IV) information disclosed by the company;
(V) the company's internal control system and the audit report on major connected transactions;
(VI) other relevant matters.
Article 22 at the meeting of the audit committee, the report provided by the audit department shall be reviewed, and the relevant written resolution materials shall be submitted to the board of directors for discussion:
(I) work evaluation of external audit institutions, employment and replacement of external audit institutions;
(II) whether the company's internal audit system has been effectively implemented and whether the company's financial report is comprehensive and true; (III) whether the financial reports and other information disclosed by the company are objective and true, and whether the company's major connected transactions comply with relevant laws and regulations;
(IV) work evaluation of the financial department and Audit Department of the company, including their principals;
(V) other relevant matters.
Chapter V rules of procedure
Article 23 the meetings of the audit committee are divided into regular meetings and interim meetings. It shall be convened and presided over by the chairman of the Audit Committee (convener).
When the chairman (convener) of the audit committee is unable or refuses to perform his duties, he shall appoint an independent director to perform his duties on his behalf. The meeting shall be notified to all members seven days before the meeting. The agenda and relevant materials of the meeting shall provide sufficient materials to all members at least two days before the meeting. Before the meeting, members shall fully read the meeting materials.
Article 24 the audit committee shall hold at least four regular meetings every year.
The audit committee may hold interim meetings as needed. The notice of the interim meeting shall be sent by mail or other means 2 days before the meeting.
Article 25 the meeting of the audit committee shall be held only when more than two-thirds of the members are present; Each member has one vote; Resolutions made at the meeting must be adopted by more than half of all members. If effective deliberation opinions cannot be formed due to the avoidance of audit committee members, relevant matters shall be directly deliberated by the board of directors.
If any member of the audit committee has an interest in the matters discussed at the meeting, he shall withdraw.
Article 26 members of the audit committee shall attend the meeting in person and express clear opinions on the matters under consideration. If a member is unable to attend the meeting in person for some reason, he may submit a power of attorney signed by the member and entrust other members to attend and express their opinions on his behalf. The power of attorney must specify the scope and duration of authorization. Each member shall be entrusted by at most one member. If an independent director is unable to attend the meeting in person for some reason, he shall entrust other independent director members to attend the meeting on his behalf.
Article 27 the voting method of the audit committee meeting shall be show of hands or voting. The meeting may also be held by means of communication voting.
Article 28 when the Audit Committee deems it necessary, it may invite representatives of external audit institutions, company supervisors, internal auditors, financial personnel, legal advisers and other relevant personnel to attend the meeting of the Committee and provide necessary information.
Article 29 minutes of the audit committee meeting shall be made. Members and other personnel attending the meeting shall sign the minutes of the committee meeting. The minutes of the meeting shall be properly kept by the person or organization responsible for daily work. Article 30 the deliberation opinions adopted at the meeting of the audit committee shall be submitted to the board of directors of the company in writing. Article 31 all personnel attending the meeting shall be obliged to keep confidential the items discussed at the meeting and shall not disclose relevant information without authorization.
Article 32 the convening procedures, voting methods and proposals adopted at the meeting of the audit committee shall comply with the provisions of relevant laws, regulations, the articles of association and these guidelines.
Chapter VI Information Disclosure
Article 33 the company shall disclose the personnel of the audit committee, including the composition, professional background, working experience within five years and the changes of the personnel of the audit committee.
Article 34 the company shall disclose the annual report on the website of Shanghai Stock Exchange at the same time
The annual performance of the audit committee mainly includes the performance of its duties and the convening of the audit committee meeting.
Article 35 If the major problems found by the audit committee in the course of performing its duties touch the information disclosure standards stipulated in the stock listing rules of Shanghai Stock Exchange, the company shall disclose such matters and their rectification in a timely manner.
Article 36 the audit committee shall put forward deliberation opinions to the board of directors of the company on matters within its scope of responsibility. If the board of directors fails to adopt them, the company shall disclose the matter and fully explain the reasons.
Article 37 the company shall disclose the special opinions issued by the Audit Committee on major matters of the company in accordance with laws, administrative regulations, departmental rules, the stock listing rules of Shanghai Stock Exchange and relevant normative documents.
Chapter VII supplementary provisions
Article 38 these Implementation Rules shall be implemented from the date of deliberation and adoption by the board of directors.
Article 39 matters not covered in these Implementation Rules shall be implemented in accordance with relevant national laws, regulations and the articles of Association; In case of any conflict between these rules and the laws and regulations promulgated by the state in the future or the articles of association modified by legal procedures, the provisions of relevant national laws, regulations and the articles of association shall be implemented. The company shall immediately revise these rules and submit them to the board of directors for deliberation and approval.
Article 40 the right to interpret these rules belongs to the board of directors of the company.
